The US Commerce Department has ruled that Japanese outboard motors are being sold in the US at unfairly low prices and has proposed imposing penalty tariffs on the imported engines, officials said Monday.
The department’s International Trade Administration made a preliminary determination that tariffs of 22.52% should be imposed on outboard engines manufactured by the Yamaha Marine Co., a unit of Yamaha Motor Co., and other Japanese manufacturers.
The ruling came in a case brought by Mercury Marine of Fond du Lac, Wisconsin, one of the largest US makers of outboard motors with $1.8 billion in annual sales.
The company had contended it was being injured because Japanese manufacturers were selling their outboard motors in the US either below the price in the Japanese market or below the cost of production, a practice known as dumping.
The ITA ruling won’t become final until the agency conducts a further investigation that involves taking public comments. The agency said it likely would make its final decision by Dec. 24, after which the case will go back to the US International Trade Commission for a final ruling on whether US companies are being hurt by sales of the Japanese motors.
In February, the ITC issued a preliminary ruling that the Japanese boat motors sales were hurting US industry. A final ITC decision is expected Feb. 7.
The Commerce Department said the US imported $673.5 million worth of outboard motors from Japan last year, a 15% increase from 2002.
Mercury Marine’s Japanese competitors include Honda Motor Co., Yamaha, Suzuki Motor Co. and Tohatsu.
When Mercury Marine filed its complaint, Yamaha contended the case was without merit. (Dow Jones & Company, Inc.)