clock menu more-arrow no yes

Filed under:

HONDA PREDICTS REVERSAL OF $17 MILLION BACK-DUTY VERDICT

A Honda of America Manufacturing official predicts a U.S. Customs Service ruling that Honda owes about $17 million in back duties will be overturned.

A customs audit released early this week said Honda is not entitled to duty-free status for about 91,500 Civic models built in Canada in 1989 and 1990 because they do not contain the necessary 50 percent North American content. Honda is appealing the ruling.Scott Whitlock, executive vice president of Honda of America, said the Civics are 66 percent North American-made and not 46 percent percent as claimed by the Customs Service.

Whitlock, in Columbus Wednesday to address an annual meeting of the Ohio Chamber of Commerce, said the Civic engine parts processed at the company's Anna, Ohio, plant were unfairly excluded by Customs in its calculations.

He also said that two bills pending in Congress are aimed "squarely against" Honda jobs in Ohio.

The nearly identical bills introduced last year by Rep. Richard Gephardt, D-Mo., and Sen. Donald Riegle, D-Mich., would require a 20 percent reduction in the U.S. trade deficit with Japan in each of the next five years. Auto import quotas would be imposed if the annual reductions are not met.

Whitlock said President Bush has opposed such legislation in the past and the outlook for passage of the proposals is not good.

However, in February, the company wrote letters to its Ohio employees, encouraging them to contact their congressional representatives to oppose the bills.

Whitlock says the legislation favors the Big Three U.S. automakers by classifying companies as "transplant" or "domestic."

He said Honda employees in Ohio could face layoffs if import quotas were imposed.

"I don't think it makes sense to approach protectionism by laying off Americans," Whitlock said.

He said the company's success in Ohio during the past two decades shows that "Ohioans can compete in the world marketplace."

He said the company will spend $2.9 billion on parts and materials this year - 60 percent of that in Ohio where Honda employs 10,000.