19 461 Exports of automotive products to countries other than Canada rose 49 percent over 1973 to $2.7 billion in 1974. The increase in 1974 followed an increase of 33 percent of automotive exports in 1973 as compared to 1972. Half of the 1974 rise was in exports of parts and the remainder in both cars and trucks. The largest export markets remain Mexico, the European Common Market, and Venezuela. As a percent of total foreign trade in 1974, automotive products amounted to 6 percent of our total exports of $98,506 million and to 11 percent of our $100,972 million of imports from all countries.14/ Canadian Automotive Trade With Countries Other 16/ Than the United States. Canadian exports of automotive products to countries other than the United States were $280 million or 4 percent of Canada's automotive total production in 1974.15/ Exports of cars were $76 million, trucks $89 million and parts $115 million. Vehicles accounted for 60 percent of the 1974 exports, compared to 56 percent in 1973. South Africa, which took $23 million worth of exports, was Canada's largest export market except for the United States. Canadian automotive imports from countries other than the United States declined from 1972 to 1973, but rose 24 percent in 1974.17/ Japan is the largest automotive supplier to Canada, except for the United States, and in 1974 supplied $343 million or 49 percent of Canada's imports from overseas. West Germany is the next largest supplier with a 20 percent share of the Canadian import market. 462 20 Changes in the Agreement. No negotiations concerning the Agreement took place in 1974 between the governments of the United States and Canada. The Agreement continues to be a subject of discussions covering general economic issues but no formal proposals for change were considered by the two governments. United States Adjustment Assistance. The Automotive Products Trade Act of 1965 provided special adjustment assistance procedures for individual firms or groups of workers dislocated primarily because of the operation of the Agreement. These provisions expired June 30, 1968. Prior to the expiration of these provisions, petitions for adjustment assistance were filed by 21 groups of workers. Certifications were issued in 14 cases and weekly allowance payments totaling about $4.1 million were made to approximately 1,950 workers. No petitions were submitted by firms. General Agreement on Tariffs and Trade (GATT) Waiver. Article 1 of the General Agreement on Tariffs and Trade (GATT) provides for the extension of unconditional most-favored-nation treatment with respect to customs duties levied on products imported from the GATT contracting parties. Under the Automotive Agreement certain automotive products are allowed duty-free entry into the United States only when imported from Canada. It was, therefore, necessary for the United States to obtain a waiver of its GATT obligations to the extent required to put the Agreement into effect. The waiver was approved on December 20, 1965, and provided for an annual report and a 21 463 review by the Gatt contracting parties after two years, and, The waiver provides for consultations between the United States and any contracting party which believes that elimination of the U.S. customs duties on imports of an automotive product from Canada has created a significant diversion of U.S. imports of that automotive product from the requesting No request for such consultations has been country. received by the United States. Determination of "Bona Fide Motor Vehicle Manufacturer." Under the Automotive Products Trade Act of 1965 imports of duty-free Canadian original motor vehicle equipment are limited to imports made pursuant to an order, contract, or letter of intent from a bona fide motor vehicle manufacturer in the United States. The Act defines such a manufacturer as a person who, upon application to the Secretary of Commerce, is determined by the Secretary to have produced no fewer than 15 complete motor vehicles in the United States during the previous 12 months and to have installed capacity in the United States to produce ten or more complete motor vehicles per 40-hour week. The Secretary of Commerce has delegated this responsibility to the Deputy Assistant Secretary for Domestic Commerce. Rules and Regulations, published in Part 315, Chapter III, 464 22 Title 15 to the Code of Federal Regulations, outline pro cedures for filing applications and set out the qualifications of a bona fide motor vehicle manufacturer. They also provide for preparation, maintenance, and publication of a list of these manufacturers. These rules and regulations state that a person shall be regarded as having had the capacity to produce a complete motor vehicle only if his operations include the assembly of two or more major components (e.g., the attachment of a body of a chassis) to create a new motor vehicle ready for use. The certified manufacturers are As of June 1, 1975 a total of 184 U.S. manufacturers were certified as "bona fide motor vehicle manufacturers."18/ Certification of a manufacturer is valid for a 12-month period from the date the Secretary determines the manufacturer is qualified, and is renewable. engaged in one or more of the following types of business: (1) manufacture of motor vehicles, including motor vehicle chassis; (2) manufacture and installation of motor vehicle bodies, and other motor vehicle equipment on new chassis; and (3) installation of motor vehicle bodies, trailer hitches known as fifth wheels, and other motor vehicle equipment on new chassis. The manufacturers are located in 37 states, with Ohio, Michigan, Wisconsin, Illinois, Minnesota, New York and Pennsylvania leading the list in number of establishments. Motor Vehicle Manufacturers Listed by Canada. The Canadian Government lists 80 firms which it considers to be motor vehicle manufacturers as of April 14, 1975.19/ 18/ App. D, page 61 19/ App. E, page 70 23 465 STATISTICAL TABLES TABLE 1.--Retail Sales of Motor Vehicles, 1965-74, TABLE 2.--U.S. Motor Vehicle Production, Calendar TABLE 3.--Canadian Motor Vehicle Production, Calendar Years 1965-74.... TABLE 4.--Price Indexes for Automotive Equipment in TABLE 6.--Price of Typical Model, Subcompact 2-Door TABLE 7.--Price of Typical Popular Model, 4-Door Sedan, 8 Cylinder with Comparable Standard Page 25 26 27 28 29 30 31 TABLE 8.--Price of Typical Popular Model, 2-Door 32 TABLE 9.--Total Employment in the U.S. Automotive Products Industry Based on U.S. 1967 Standard TABLE 10.--Total Employment in Canadian Automotive TABLE 11.--Value of Canadian Motor Vehicles and Original 333 34 Motor Vehicle Equipment (Canadian Articles) 35 TABLE 12.--U.S. Automotive Trade, Total with all Countries, with Canada, and with all Countries 41 |