WASHINGTON (June 24, 2009)-The U.S. International Trade Commission will meet June 29 to determine the appropriate remedy for the disruption it found in the U.S. tire market caused by Chinese passenger and light truck tire imports.
On June 18, the commission voted 4-2 in agreement with the petition from the United Steelworkers that the U.S. tire industry needs to be protected from Chinese imports. The USW filed its petition April 20 under Section 421 of the Trade Act, which allows industries and unions to file for relief in the case of dramatically increased imports from China.
Chinese imports increased from just under 15 million in 2004 to over 46 million in 2008, causing more than 5,000 U.S. tire workers to lose their jobs and another 3,000 to face the prospect of losing their jobs this year, the USW said. It asked the ITC for a three-year quota on Chinese tire imports, starting at 21 million the first year and increasing by 5-percent increments over the next two years.
However, the Tire Industry Association and several of its most important members opposed the petition. Chinese tire imports serve a lower-end market U.S. tire makers do not supply, and therefore Chinese imports cannot be considered a direct threat to U.S. tire manufacturing, they argued. A quota would only cause hardships to motorists who can only afford lower-cost tires and the dealers who sell those tires, they said.
The ITC will transmit its report and recommendations on Chinese tire imports to President Obama and the Office of the U.S. Trade Representative July 9. President Obama has sole authority to approve or reject the ITC's recommended remedies, but he is expected to be friendlier to Section 421 remedies than ex-President George W. Bush, who rejected all Section 421 remedies during his two terms.