07.07.2020

Link Belt comes out against tariffs

US crane manufacturer Link-Belt has issued a letter to its distributors, a copy of which we have managed to obtain, stating that as a company it is against the imposition of US import tariffs or trade restrictions.

In a carefully drafted and thought out statement it also confirms that it will file comments against the move this week as part of the public consultation stage.
We have decided to simply publish the full unedited text of the letter, given that it sets out the case in detail. See our earlier article Crane import investigation moves ahead

To All Link Belt Distributors
“I would like to take this time to inform you of important activity in our business that you may or may not be aware of and communicate to you Link-Belt Crane’s position and planned actions regarding this ‘activity.’

Petition
This past May, the United States Department of Commerce announced it would begin investigating North American mobile crane pricing and related issues in response to a petition filed by the Manitowoc Crane Company in December of last year.

Claim
In this petition Manitowoc alleges that unfair pricing tactics of mobile cranes from Germany, Austria, and Japan, and intellectual property infringement by foreign competition, has harmed the domestic mobile crane manufacturing industry, eroding Manitowoc’s margins and threatening Manitowoc’s sustainability.

Manitowoc suggests (should they no longer exist) it would present a threat to National Security as the Department of Homeland Security has identified mobile cranes as a critical industry due to extensive use in national defense applications, and infrastructure sectors-* Threat to National Security Act #232*: details are available on the internet.

Manitowoc contends that without import “relief,” the armed forces and their contractors would become largely dependent on foreign producers of mobile cranes. A tariff on foreign manufactured mobile cranes, (makes and models as outlined by Manitowoc) is the suggested relief.

Interesting to note, Manitowoc recommends omitting tariff’s on any foreign made cranes that they manufacture and import into North America (AT’s) or have an ongoing licensing agreement with (specifically, Sennebogen telescopic crawler cranes), both built in Germany.

Reaction
As you might imagine a considerable ‘backlash’ of negative sentiment over this petition is occurring against Manitowoc by crane end-users, manufacturers (and others) as it is widely viewed as an attempt to restrict trade and ultimately bring about higher crane prices in the United States.

Additionally, other industry associations and end-user markets that (while not directly related to the cranes) have concern over what such tariffs, if allowed to go ‘unchecked’ could potentially impact their business as well.

Link-Belt Position
We see no benefit to tariffs or restrictions to free and open trade. In fact, we are on record as opposed to tariffs in previous Department of Commerce reviews. By their nature, tariffs that may be implemented with the best of intentions to help one segment of our economy, many times result in unexpected harm to other parts of the economy. An excellent example of this was the imported steel and aluminum tariffs, put in place in recent years, to help the U.S. based steel and aluminum producers compete against low priced, imported raw material. The intended results of the tariffs were that steel and aluminum raw material prices would increase for U.S. based producers, thus making them more capable of competing with the imports. The prices did increase, dramatically.

However, the unintended effect of the increased prices put U.S. based manufacturers / consumers of raw steel and aluminum at a distinct disadvantage. We paid and have continued to pay significantly higher prices for raw material while non-U.S. based manufacturers consumed raw material, many times from these same non- U.S. supplier countries, with no tariff impact to their cost.

Planned Actions
Therefore, we cannot support Manitowoc’s petition even when there is potential for us to benefit. We will be filing a formal complaint to clarify some misrepresentations in the original Manitowoc petition regarding our company structure as well as the products that we manufacture domestically. We will also oppose the tariffs and the restraint of free trade consistent with our previous stance in this regard.

Link-Belt will continue to compete and grow our share and profits on the same values and ethics we have for over 145 years, designing and building better products, superior product support and reinvesting in our business.”