Representatives of the Chamber of Motorcycle Manufacturers (CAFAM) participated in a meeting with the Minister of Production and Labor of the Nation, Dante Sica, in which the publication of the decree (81) was finalized that applies the tariff differentiation between imported motorcycles that enter assembled, complete disassembled motorcycles, and incomplete motorcycles that include 5% of parts of national origin, which will be exempt from the tax.

This measure, which includes electric motorcycles, thus seeks to especially benefit terminals that invest in the integration of parts manufactured in the country and articulate their productive network in the models that are developed in Argentina.

Lino Stefanuto, President of CAFAM, mentioned "we are very grateful for the management of the authorities together with the members of the motorcycle sector that allowed the publication of this decree that will undoubtedly offer a boost to the national motorcycle industry. We celebrate this regulation since it is a decree that was agreed upon by all the parties involved: government, unions, motorcycle parts and manufacturers." And he added: "Since the creation of the chamber we have always highlighted the importance of achieving an intelligent, sustainable integration that favors local production and at the same time provides the freedom to each manufacturer to choose the option of importing products according to the format that is most convenient for them."

To be exempt from the tax, local manufacturers must integrate 5% of physical components during the first year with the addition of assembly, packaging and quality control of national origin. During the second year the percentage must rise to 7% and during the third year to 9%.

Stefanuto also highlighted "there were also two other important achievements with this management: that the LCM (Model Configuration License) process streamlined the homologation process since it can now be done electronically and with predictable times; and also the update of the tax base for the internal tax that was brought to $380 thousand from the previous base of $140 thousand. This measure corrects the impact on prices that the tax generated on low-mid-range motorcycles."

The companies estimate that this decree 81 will have a positive impact on the mobilization of the motorcycle industry in the country, which could result in 80% of motorcycles being assembled with the inclusion of local components during 2019.

The initiative will allow the development of suppliers to the metalworking industry that includes a high labor component with national raw materials, increasing the local production of batteries, handlebars, chassis, pedals, crowns, sprockets, electrical installations, wiring, chains, spokes and seats; inter alia.

· The measure constitutes the corollary of the sectoral table that had begun in mid-2017 and will provide a definitive boost to the national motorcycle industry.

· The aim is to promote a sustainable process of local integration of parts and pieces within the framework of a plan agreed upon with the private sector, granting tariff benefits in return for the importation of those that are not produced in the country.

· The regulations establish tariff differentiation in three categories: 35% tax on imported fully assembled motorcycles, 20% for complete disassembled motorcycles and 0% tax applicable to incomplete units that subtract 5% of their value in parts to be integrated locally.

· By adding the assembly costs to the 5% in parts, the local integration would reach the order of between 25% and 30% of the value of the motorcycle.