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'Chicken Tax' Shows Tariffs' Lasting Effects; Ford Has Designs on AI By Mark R. Long

An import duty known as the chicken tax shows how tariffs can reshape-and distort-global trade and supply chains over decades, with effects far exceeding their original purpose.

The WSJ's Stephen Wilmot writes that the U.S. has levied a tariff on imported trucks since 1963, when President Lyndon Johnson retaliated against European duties on American poultry . That 25% tariff-the same size as duties President Trump introduced on steel and aluminum imports -did drive automakers to assemble pickups and vans in the U.S. It also gave companies strong incentives to find workarounds in their supply chains to avoid paying it.

For instance, before 2018, Mercedes-Benz made Sprinter vans for the U.S. market in Germany, then partially disassembled them to ship to South Carolina, so they could be put together again on U.S. soil. Subaru famously bolted a pair of seats into the bed of an imported small pickup, the BRAT, so it would count as a passenger car.

Finding these workarounds and encouraging local production means the federal government gets relatively little money from the 25% chicken tax, just $104 million last year, compared with $3.6 billion from a 2.5% tariff on passenger vehicles.

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Quotable Manufacturing

Ford Motor's head of artificial intelligence is pushing to use the technology to bring new cars from the design stage to production as fast as its rivals.

Bryan Goodman, who has been at Ford since 1999, tells the Journal's Isabelle Bousquette that AI agents can independently perform tasks on behalf of humans, speeding car designs to market . Today, designers sculpt each new model out of clay before passing them to engineers for simulations and testing. Clay isn't going away entirely, but Ford is using AI models from OpenAI, Anthropic and China's DeepSeek to help automate and speed up that process.

For example, Goodman says the company has trained AI systems to predict stresses and conduct different physics-based tests, like computational fluid dynamics and wind tunnel drag. Before, "one run would take 15 hours," he said. "But we've trained an AI model to predict what that would do and it runs in 10 seconds."

High-Tech Supply Chain Number of the Day In Other News

The Federal Reserve held steady its benchmark interest rate at around 4.3%, marked up its forecasts for inflation and revised down its outlook for growth this year. (WSJ)

Eurozone inflation was less rapid than estimated last month, adding to signs of coolness in the economy. (WSJ)

Indonesia's central bank held interest rates steady . (WSJ)

Amtrak Chief Executive Stephen Gardner said he is resigning . (Dow Jones Newswires)

U.S. and U.K. arms makers are set to be largely excluded from new European Union defense procurement loans unless their countries sign defense and security agreements. (WSJ)

Uranium investments are having a tough start to the year as tariffs and geopolitical risks stir uncertainty. (WSJ)

General Mills expects organic sales to decline as consumers spend less on snacks. (WSJ)

7-Eleven's Japanese owner signed a pact with Canada's Alimentation Couche-Tard to consider the sale of some U.S. stores. (WSJ)

Rio Tinto urged shareholders to reject an independent review of the mining giant's dual-listed structure. (WSJ)

JX Advanced Metals shares rose in their trading debut after Japan's Eneos spun off the unit that makes materials in the semiconductor and information-technology sectors. (WSJ)

South Korea's Hanwha Group has taken a 9.9% stake in Australian shipbuilder Austal almost a year after it proposed a full takeover. (Dow Jones Newswires)

Trump's proposed fees on Chinese ships visiting U.S. ports are limiting the availability of vessels to move commodities and manufactured goods overseas. (Reuters)

A food and beverage makers' trade group asked the White House for tariff exemptions for key ingredients imported by its members. (Supply Chain Dive)

A.P. Moeller-Maersk shareholders voted down a resolution to ban the carrier from shipping arms to Israel, which the company says it doesn't do. (The Maritime Executive)

The Truckload Carriers Association named Karen Smerchek , president and owner of Veriha Trucking, as its chairman. (American Journal of Transportation)

Tsakos Energy Navigation confirmed a long-term charter deal with Petrobras unit Transpetro for nine new shuttle tankers to be built by Samsung Heavy Industries. (Splash 247) About Us

Mark R. Long is editor of WSJ Logistics Report. Reach him at [mark.long@wsj.com]. Follow the WSJ Logistics Report team on LinkedIn: Mark R. Long , Liz Young and Paul Berger .

This article is a text version of a Wall Street Journal newsletter published earlier today.

(END) Dow Jones Newswires

March 20, 2025 07:03 ET (11:03 GMT)

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