Mercedes-Benz has added a record $500 million to its South Carolina-based commercial van factory in an attempt to differentiate itself from other competitors. This groundbreaking investment strategy is part of the German automaker’s mission to establish a strong market niche in the United States, which is the second largest market for the Sprinter van. The $500 million investment will be used to upgrade the Ladson, S.C., Plant, on which the Metris commercial van and Sprinter are assembled by Mercedes once components dispatched from Europe land at the Port of Charleston.
Relocation of Sprinter’s production plant to North Charleston will increase U.S. sales by enabling Mercedes to not only build more vans but also deliver them on time and at budget friendly cost. A 25 percent tariff popularly called “chicken tax” on imports such as commercial vans and pickup trucks, has prevented Sprinter from competing fairly against Ford Transit and other leading commercial vans.
The “chicken tax”, enforced by retired President Lyndon B. Johnson after West Germany and France imposed a tariff on chicken imported from America, hampers automakers that develop trucks overseas and deliver them to the U.S. market. To evade the double-digit tax, the automakers disassemble the trucks prior to dispatching them oversee and assemble them at an assembly plant based in the U.S.
Mercedes-Benz Vans USA’s vice president, Bernie Glaser, said that he is optimistic that the South Carolina plant will begin to build the advanced Sprinter within one decade after it officially starts operating. The new investment is expected to create more than 1,300 employment opportunities at the plant as well as 400 other jobs with local suppliers.