A possible reduction in the recently boosted light-truck tariff may point the way to an eventual voluntary agreement with Japan under which that country would reduce its auto exports to the United States, informed officials said yesterday.
President Carter supplied the clue to this prospect in a little-noticed observation in Detroit on Tuesday, where he unveiled the administration's plan to help the ailing domestic auto industry.
Carter told auto executives and United Auto Workers President Douglas Fraser that he has decided to allow a 25 percent import duty on light trucks to go into effect on Aug. 21, as proposed May 19 by the Treasury Department.
He would only consider a reduction from that 25 percent figure, boosted from 4 percent, if the japanese government agrees to give auto trade concessions to the United States in future negotiations, Carter added.
It was the first mention of possible "negotiations" with Japan on auto trade issues and a clue to the drift of administration thinking.
"What other auto trade concessions can you think of that are more important than quotas on Japanese cars?" asked an official working on the auto problem.
Other officials urged caution, noting that there could be other considerations which might induce Carter to lower the 25 percent truck tariff. cFor example, Japan maintains a commodity tax on cars that discriminates against U.S. imports because it is higher on larger cars than smaller cars. A reduction in this barrier would be welcomed by the United States, officials said.
But it generally was agreed that if a Voluntary Restraint Agreement (VRA) becomes legally possible, in the wake of an upcoming International Trade Commission decision on a UAW "escape clause" case, there might be a tradeoff offered the Japanese in the form of reduction of the light-truck tariff.
The 25 percent impost affects $1.4 billion worth of Japanese truck sales. Japanese companies had discovered that by shipping a truck cab-chassis separate from the box or container that made them a full truck, they were hit with only a 4 percent tariff instead of the 25 percent truck tariff.
Under the revised classifications issued by the Treasury on May 19, Carter could lower the tariff in one stroke to 8.5 percent and eventually to 6.8 percent, if he chooses.
Some observers suggested that Japan might jump at the opportunity to get a permanent reduction in the truck tariff in exchange for a voluntary hold-back on auto exports, which presumably would be only of temporary duration.
Meanwhile, Carter's request that the ITC accelerate its investigation of the UAW complaint was presented formally to that body in a letter to Commission Chairman William Alberger.
Although White House officials maintain that Carter had not intended to put pressure on the ITC to come up with a ruling leading to quotas, Carter said in the letter that the investigation has become "a matter of great national and international importance."
Carter's letter said that the case, brought on June 12 by the UAW, "touches so many businesses, workers andconsumers in this country that an investigation of normal length could cause great uncertainties which could significantly affect automobile trade and production."
If the ITC decides that auto imports -- predominantly from Japan -- are damaging or threaten to damage the domestic industry, it can recommend that the President impose quotas or tariff sanctions. The law allows six months for resolution of escape-clause cases, which are designed to provide temporary relief to industries injured by a substantial influx of imports.
The ITC, according to Dow Jones News Service, may begin public hearings in early September, rather than early October as previously scheduled, setting the stage for a pre-election, late September decision.