Mercedes-Benz Went to Absurd Lengths to Avoid the 'Chicken Tax'
We have, perhaps unfairly, categorized German automakers as far more calculating and efficient than their American counterparts. While there is certainly a case to be made for this positive stereotyping, there are also plenty of examples calling this perceived Germanic precision into question. One such instance is the absolutely ridiculous lengths Mercedes-Benz have been going to avoid the chicken tax on its imported vans.
To avoid the truck-based tariff, Mercedes has spent the last decade manufacturing complete vans in Germany only to tear them apart and ship them to South Carolina. American workers could then reassemble the vans in a small kit assembly building, making them technically domestically constructed and saving the company the 25-percent import tax.
“I really couldn’t believe it,” Volker Mornhinweg, global head of Mercedes-Benz Vans, told Automotive News. “To build up and tear down, that’s really something that hurts me, personally. And the costs!” he said, shaking his head at the memory.
The discovery was made in 2010 when Mornhinweg became head of van production. Since that time, he has gradually been establishing a less convoluted way to get German product into the United States.
Mercedes-Benz Vans intends to eliminate the wonky supply line starting with the next generation of the Sprinter. The new vans will be be assembled more normally in South Carolina using a new production and painting system Benz has put together for half a billion dollars.
“Finally, we have the opportunity to build the Sprinter from scratch here in the United States, from this new manufacturing facility,” Mercedes-Benz Vans CEO Michael Balke said.
Transforming the MB van factory from a small assembly workshop to a full-scale manufacturing plant is no measly feat. The enlarged facility is anticipated to create over 1,300 new jobs and should begin accepting applications for those positions by the middle of next year.
[Image: Mercedes-Benz]
Consumer advocate tracking industry trends and regulations. Before joining TTAC, Matt spent a decade working for marketing and research firms based in NYC. Clients included several of the world’s largest automakers, global tire brands, and aftermarket part suppliers. Dissatisfied, he pivoted to writing about cars. Since then, he has become an ardent supporter of the right-to-repair movement, been interviewed about the automotive sector by national broadcasts, participated in a few amateur rallying events, and driven more rental cars than anyone ever should. Handy with a wrench, Matt grew up surrounded by Detroit auto workers and learned to drive by twelve. A contrarian, Matt claims to prefer understeer and motorcycles.
More by Matt Posky
Comments
Join the conversation
Once upon a time the USA had no federal income tax and instead raised the majority of the money to run the federal government primarily through import tariffs and taxes on alcoholic beverages. If you hate paying federal income taxes, you should love import tariffs :).
Did nobody else notice the buried gem in this article? There is finally a new Sprinter coming! Details, please. AWD w/o the current 3-4" lift, please. I'll be down to order one on Day 1 of Model Year 2. Our 2007 diesel Sprinter is an absolute winner for so many things.