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E-bike industry, including Uber, requests exemption from tariffs

Published December 21, 2018

WASHINGTON (BRAIN) — PeopleForBikes and the Bicycle Product Suppliers Association have submitted requests on the industry's behalf for exemption from the 25 percent tariff on Chinese-made e-bikes that took effect last summer. The deadline was Thursday for submitting the requests to the U.S. Trade Representative.

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The Trump administration has granted thousands of exemptions to its tariffs on aluminum and steel that took effect in March, but has yet to grant any for the later rounds of tariffs. The steel and aluminum exemption process is being run by the Dept. of Commerce, not the USTR. The USTR has not announced an exemption application process for the newest tariffs, which put an additional 10 percent duty on Chinese bikes and parts, increasing to 25 percent next year. 

The trade groups' 15-page exclusion application for e-bikes summed up its request in four points:

  1. It would be easy for Customs officials to differentiate e-bikes from the electric motorcycles that are included under the same HTSUS code as e-bikes
  2. Shifting e-bike production out of China to other countries would not satisfy demand for the bikes in the U.S.
  3. The additional duties are causing "severe economic harm" to members of PeopleForBikes and BPSA as well as U.S. retailers and consumers
  4. E-bikes are not strategically important or part of China's stated strategic goals for its domestic manufacturing.

The application went on to point out that between 2016 and 2018 there has been a steady decline in the number of bikes sold in nearly every market segment except e-bikes.

Besides the request submitted by the trade groups, at least three e-bike importers submitted their own requests. Uber Technologies, which imports thousands of e-bikes for its Jump share bike program, was joined by Magnum Bikes Inc., a Salt Lake City e-bike importer, and Allco Manufacturing, an importer.

Uber's request did not publicly reveal how many bikes it imports. The company did say that the duty "is causing disproportionate and severe economic harm to U.S. interests, while failing to address China's acts, policies and practices that are the intended target of the Administration's Section 301 action. The additional duty is also causing outsize damage to American innovation and competitiveness in the fast-developing and strategically important field of digital transportation platforms."

Like the PeopleForBikes/BPSA request, Uber pointed out that e-bikes are significantly different from the electric motorcycles that are included under the same HTSUS product code.

Uber also submitted a letter from four U.S. Representatives to the U.S.T.R. in support of an exemption for e-bikes. In addition to e-bikea, the Sept. 13 letter asked the USTR to refrain from imposing additional tariffs on Chinese bikes, bike parts and safety gear. The administration announced on Sept. 17 that the additional tariffs on bikes and parts would be imposed, but the safety gear (helmets and lights) was exempted as the representatives requested. The letter was signed by U.S. Reps. Earl Blumenauer, D-Ore., Mike Thompson, D-Calif., Ron Kind, D-Wis., and Dave Reichert, R-Wash.

 

Topics associated with this article: Tariffs

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