LADSON, S.C. -- A curious exercise in auto manufacturing takes place daily inside the old, 350,000-square-foot Western Star truck plant here now owned by Daimler.
This is where Mercedes-Benz and Freightliner Sprinter cargo vans are reassembled after being fully built and tested in Dusseldorf, Germany.
It's the "chicken tax" at work.
After the Sprinters are manufactured, German workers strip out the drivetrains and fuel systems. The disemboweled vans are exported to the Port of Charleston, S.C., vehicle bodies on one ship, mechanical components on another. After clearing customs, the van bodies and parts are transported 19 miles to the Ladson plant.
The reassembly process sounds like a logistical and potential quality nightmare. American workers reinstall drivetrains and fuel systems in the same vehicles from which they were removed in Germany. Any nuts, bolts or connectors designed to be torqued down only once are replaced with new ones shipped from Germany.
Then, reassembly line workers reconnect the brakes, refill all fluids and fully retest the vans before they are shipped to dealers. The only U.S. content in the Sprinter? The battery.
Daimler has devised a reasonably efficient system. Between 66 and 74 vans a day roll off the 17-station line five days a week. Each van requires 3.5 hours of work to reassemble.
During a plant tour, Sprinter chief engineer Walther Bloch said the quality of the reassembled vans matches that of Sprinters sold in other global markets.
Including passenger van versions inspected but not reassembled at Ladson, the plant expects to process about 23,000 Sprinters this year.
The gyrations some automakers perform to avoid the 25 percent tariff seem wasteful and crazy. But some things make sense. For example, automakers can import a light truck and test the market without having to commit to a major assembly plant on U.S. soil.
The 90 people at the Daimler plant earn good wages. So you know they don't want the chicken tax repealed.
Mercedes says that the strip/ship/reassembly process adds about 9 percent to the $36,999 base price of the Sprinter, a big savings over a 25 percent tariff.
The chicken tax traces back to a 1960s trade dispute with several European nations. They accused the United States of dumping chicken in their markets for less than the cost to produce them and imposed tariffs on U.S. chicken. President Lyndon Johnson retaliated by imposing a 25 percent tariff on potato starch, dextrin, brandy and light trucks 50 years ago. Eventually, the U.S. tariffs were lifted on everything but light trucks.
Mercedes isn't alone in circumventing the chicken tax. So do Ford and Chrysler.
Ford Transit Connects, manufactured in Spain and shipped to the U.S. as passenger vehicles, come with rear seats, seat belts and windows. Once the vehicles land at the port in Baltimore, Ford converts about 70 percent into cargo vans by removing the seats, windows and seat belts. Chrysler is preparing to use the same strategy with Ram ProMaster City small vans built in Turkey as passenger vehicles.
Next year, Daimler will expand its U.S. van lineup with the smaller Metris to be built in Vitoria, Spain. Like the Sprinter, U.S. versions will leave Europe in pieces and be reassembled in Ladson.
Mercedes hopes to expand its U.S. commercial van business to 50,000 units a year. Once it is at that threshold, company officials say, the door is open to constructing a local plant to build the Sprinter and Metris.
There have been efforts to repeal the chicken tax over the years, but they never got much traction.
I went to Ladson thinking the chicken tax is a failed, outdated and nonsensical relic of the 1960s. But in this industry, nothing is ever that cut and dried.