WASHINGTON—The U.S. tire manufacturing industry is suffering material injury because of passenger and light truck imports from China, the U.S. International Trade Commission has decided in a split vote.
ITC Vice Chairman Dean Pinkert and Commissioners Irving Williamson and Rhonda K. Schmidtlein voted in the affirmative July 14 to find material injury in the investigation, while Chairman Meredith Broadbent and Commissioners David S. Johanson and F. Scott Kieff voted in the negative. At the ITC, a 3-3 vote constitutes an affirmative finding.
The ITC vote makes final the antidumping and countervailing duties levied earlier by the U.S. Department of Commerce, although those duties are retroactive to as early as Oct. 29, 2014.
In its June 12 final determination, Commerce affirmed the following countervailing duties:
• 20.73 percent against Cooper Kunshan Tire Co. Ltd.;
• 37.2 percent against Giti Tire (Fujian) Co. Ltd.;
• 100.77 percent against Shandong Yongsheng Rubber Group Co. Ltd.; and
• 30.87 percent against all other Chinese tire manufacturers and exporters.
In antidumping duties, the final Commerce figures were:
• 29.97 percent against Giti Tire Global Trading Pte. Ltd., Giti Tire (USA) Ltd. and six other Giti-affiliated companies;
• 14.35 percent against Sailun Group. Co. Ltd. and nine subsidiaries and affiliates, including Dynamic Tire Corp. and Husky Tire Corp. in Canada;
• 25.3 percent against 65 “separate rate” companies; and
• An 87.99-percent “China-wide” rate on all other companies.
This represents the second victory for the United Steelworkers union in six years against Chinese tire producers and distributors. The union issued a statement early Tuesday afternoon, applauding the decision.
“The outcome in the USW's pursuit of this case will not only help protect USW members and their families but also helps protect the jobs and futures of the tens of thousands of workers employed within the U.S. tire industry,” the USW said.
The union claimed it was the first modern dumping and countervailing duty law filed solely by workers, and it said “much more needs to be done to get our laws fairly and fully enforced.”
From September 2009 to September 2012, the USW won three years of high tariffs against Chinese passenger and light truck tires under Section 421 of the Trade Act, which helps U.S. industries against sharp increases in Chinese imports.
In June 2014, the USW petitioned the ITC again for relief from Chinese imports, this time under Sections 701 and 731 of the Trade Act.
“As soon as the relief expired, the Chinese once again swamped our markets with unfairly-priced tires,” the union said. “Only after significant injury was demonstrated were we able to bring a case, something our government should have already done.”
The union asked for antidumping and countervailing duties against the Chinese, claiming that Chinese tire imports to the U.S. skyrocketed after the Section 421 tariffs lapsed.
“We're sick and tired of China's approach to trade and breaking of the rules. Its entry into the World Trade Organization has done little to stop its cheating. Time after time, we are forced to clean up the mess caused by our negotiators generating insufficient enforcement capabilities.”
The USW reiterated what Stan Johnson, United Steelworkers International secretary-treasurer and former tire worker, wrote in letter to the editor published in the Oct. 20, 2014 edition of Rubber & Plastics News.
“Chinese tires captured 100 percent of growth in demand between 2012-14. This resulted in serious harm to domestic industry and its workers as evidenced by the direct causal relationship between surging imports from China and contraction of production in individual U.S. plants,” the union said.
“… Our trade agreements do not adequately open up foreign markets, while doing little to stop unfair trade. While many manufacturers offshore production jobs in search of the lowest labor costs, many others who look to produce domestically find that their country's own trade agreements are not doing enough to support their efforts.
“Trade should not be a one-way street. Until today, that street was dominated by the producers of Chinese-made, unfairly-traded tires. Now, we can begin to reclaim our market for more American-made tires and jobs.”
On its website, the USW posted a July 13 letter by four U.S. senators, urging the ITC to make a final determination of material injury.
“China argues that U.S. companies and workers are doing just fine,” stated the letter signed by Sens. Charles Schumer (D-N.Y.), Sherrod Brown (D-Ohio), Rob Portman (R-Ohio) and Jeff Sessions (R-Ala.). “That's like arguing a worker doesn't feel the pain when hours are reduced and pay is cut.
“Under fair trade conditions, the U.S. industry would be doing much better and workers would be sharing in the benefits,” the senators wrote. “China's producers are clearly pursuing predatory trade practices, and these practices are causing damage to the U.S. industry.”
Representatives of Chinese tire manufacturers could not be reached for comment. The ITC commissioners' rationale behind their votes will not be made public until July 27, when the agency transmits its final report to the Commerce Department.