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U.S. Tariff Loophole on Chinese EVs Has Golf Cart Producers Asking Biden For Help

Golf carts are big business these days. You cannot walk around any over-55 community without running into one. From snowbirds to all-year round residents, golf carts are often the choice of transportation to get around the community.

With this demand comes happy U.S. manufacturers – until China steps in of course.

Club Car LLC and Textron Specialized Vehicles Inc. are two of the biggest producers of golf carts in the United States. Although they may compete on product sales, these Georgia based competitors are partnering up on a mission to keep U.S. sales rolling.

Last week, they asked the Biden administration to implement a 100% tariff on low-speed, often battery-powered personal vehicles like golf carts. 

They believe this aligns with the U.S. tariffs that are in place on regular Chinese electric vehicles that are imported.

“Chinese import volumes have rapidly increased, taking greater consumer vehicle market share while using price benefits from Chinese government subsidies to drive their advantage,” Club Car President and CEO Mark Wagner said in an emailed statement Friday. “We had to take action.”

Since 2020, the number of imports of golf carts and other recreational vehicles has seen sixfold increase. According to the filing, the total amount of 2023 imports of “specially designated vehicles” was $916 million. In 2020 the amount was just $148 million.

The sales increase is in part due to a loophole in product classification. They are classified as a product in a lower tariff range than a traditional normal-sized EV. Then, when they arrive to the U.S. they will undergo modifications.

This allows China to avoid the proposed duties that would apply. 

golf cart growth of imports chart

There was a deadline last Friday for public comment on USTR’s “301 case”, under which tariffs on Chinese goods are justified.

The filing from Club Car and Textron, which makes E-Z-GO and Cushman carts, was among hundreds of other pleas for either tariff protection or relief posted during USTR’s comment window. The two companies made their case jointly under a group called the American Personal Transportation Vehicle Manufacturers Coalition. 

In a letter to USTR from the Wiley law firm in Washington, it was stated that the China competitors have resulted in a deterioration in the domestic industry’s performance resulting in a decline in production, employment, and financial performance. 

A copy of a letter dated 6/28/2024 can be found here. This letter is asking for the reclassification of golf carts and other personal use vehicles to align with the scope of what an electric vehicle is so it can receive the proper tariff. 

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