25% tax
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- Boatguy
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25% tax
All Diamond aircraft and parts for the U.S. come from Canada, even though various pieces or the entire plane may be made in Austria.
If I’m reading the news correctly, they will all now be taxed 25% to cross the border. Did a DA62 just jump up to $2.25M and come with an AD with no terminating action? Is a tariff considered force majeure?
If I’m reading the news correctly, they will all now be taxed 25% to cross the border. Did a DA62 just jump up to $2.25M and come with an AD with no terminating action? Is a tariff considered force majeure?
- laserpilot
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Re: 25% tax
Looks like the whole fleet went up in price !
C-510 SEL M600 SLS driver and current DA40 NG owner
- dmloftus
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Re: 25% tax
I'm curious about the recent DA40 NLG AD. I was about to place an order for the new NLG leg, which is about $4000. Seems like it just went to $5000 with the tariff. Does Diamond allow US owners to order directly from Austria instead of Ontario? I can't believe it would cost $1000 incrementally to ship from Austria.
- linzhiming
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Re: 25% tax
The executive order (https://www.whitehouse.gov/presidential ... al-border/) makes repeated references to "products of Canada" which would then refer to products with a country of origin of Canada, i.e. where the significant labour and parts input come from (the rules are complicated). If parts are originally from Austria, stocked in Canada and then resold by Diamond Canada for the US market, they should not fall under the "products of Canada" definition.Boatguy wrote: Sun Feb 02, 2025 8:16 am All Diamond aircraft and parts for the U.S. come from Canada, even though various pieces or the entire plane may be made in Austria.
If I’m reading the news correctly, they will all now be taxed 25% to cross the border. Did a DA62 just jump up to $2.25M and come with an AD with no terminating action? Is a tariff considered force majeure?
Full aircraft assembled in Canada most likely will be deemed to be of Canadian origin though. (Same as cars assembled in Mexico which are the products the executive order is targeting.)
A separate point: Civil aviation products and parts (accompanied with a valid 8130-3 or EASA Form 1) have in most countries enjoyed a blanket exemption from duties in general even if the product is normally subject to duties. For example, in the EU, leather products or steel products (e.g. screws) are subject to some level of duty (generally <10%) if originating from outside the EU but that level of duty does not apply if it is a civil aviation part. No idea whether that exemption will be applied to the new tariffs.
We will know in the next couple of hours when the actual database of tariffs (https://dataweb.usitc.gov/) actually gets updated.
- CFIDave
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Re: 25% tax
For US customers, Diamond produces all of its DA42-VIs and some (less than half) of its DA62s in Austria, ferrying those twins across the north Atlantic from Europe to Canada, where they are converted from Austrian to US registration. Being built in Europe, I'm guessing that those aircraft would be unaffected by the 25% tariff imposed by the US on Canadian imports.
But the majority of new Diamonds imported into the US are DA40NGs that are produced by Diamond Canada in London, Ontario. Those aircraft (along with Canadian-built DA62s and Lycoming DA40s) would be subject to a 25% duty (tax) paid by US Diamond distributors -- who would then be forced to pass that cost on to the customer via a major price increase. US distributor margins are way less than 25%, so distributors couldn't absorb much of a tariff-related increase.
With a 25% price increase on all US DA40NGs, I would guess that reduced demand might cause significant layoffs at the London factory. Diamond might import Austrian-built DA40NGs to Canada in shipping containers to avoid the tariff, but the added shipping and re-assembly costs would offset much of the 25% "savings," and the Austrian factory may be capacity-constrained.
At this point, all of this is pure speculation, since tariffs haven't yet taken effect.
But the majority of new Diamonds imported into the US are DA40NGs that are produced by Diamond Canada in London, Ontario. Those aircraft (along with Canadian-built DA62s and Lycoming DA40s) would be subject to a 25% duty (tax) paid by US Diamond distributors -- who would then be forced to pass that cost on to the customer via a major price increase. US distributor margins are way less than 25%, so distributors couldn't absorb much of a tariff-related increase.
With a 25% price increase on all US DA40NGs, I would guess that reduced demand might cause significant layoffs at the London factory. Diamond might import Austrian-built DA40NGs to Canada in shipping containers to avoid the tariff, but the added shipping and re-assembly costs would offset much of the 25% "savings," and the Austrian factory may be capacity-constrained.
At this point, all of this is pure speculation, since tariffs haven't yet taken effect.
Epic Aircraft E1000 GX
Former DA40XLS, DA42-VI, and DA62 owner
ATP, CFI, CFI-I, MEI
Former DA40XLS, DA42-VI, and DA62 owner
ATP, CFI, CFI-I, MEI
- dmloftus
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Re: 25% tax
A trans oceanic container costs $3-5K. Add some minor labor fees to reattach the wings. I think I would pick the Austria sourced option any day. Hopefully this is all a moot point and Trump's negotiating tactics result in an acceptable deal to avoid this mess.
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Re: 25% tax
Any thoughts on tariffs on used aircraft being imported from Canada to USA? Or for that matter on any used/pre-owned goods?