WASHINGTON—The U.S. International Trade Commission has reversed its original opinion on truck and bus tires from China, voting 3-2 to find material injury against the domestic tire industry because of Chinese imports to the U.S.
The ITC filed its findings Jan. 30 with the U.S. Court of International Trade (CIT), which reversed the commission's original negative determination on Chinese truck and bus tires in a Nov. 1, 2018, ruling and remanded the case to the ITC for reconsideration.
The original ITC negative determination came down in February 2017. In April of that year, the United Steelworkers union—which had sought countervailing and antidumping duties against Chinese truck and bus tire importers—filed a complaint with the CIT, seeking judicial review.
The USW took issue with the ITC on four issues, and the CIT ruled in the union's favor on two: the commission's negative adverse price effects determination and its negative threat determination, both of which the union said were "not supported by substantial evidence."
In the filing with the CIT, the ITC said it now found that Chinese imports had "a significant adverse impact" on the U.S. truck and bus tire industry.
"The subject tires undersold the domestic product by significant and increasing margins of underselling and depressed prices, preventing the domestic industry from increasing its revenues commensurate with growing demand," the commission said in the court document.
"Tier and brand premiums cannot explain price underselling in instances in which the subject and Chinese tires overlap," the ITC said. "Both domestic and Chinese tires competed directly and to a significant degree in Tiers 2 and 3, the tiers which accounted for a large portion of total shipments."
ITC Chairman David S. Johanson and Commissioner Meredith M. Broadbent dissented from the majority, continuing to find that the domestic tire industry did not face material injury because of Chinese imports.
USW International Secretary-Treasurer Stan Johnson praised the new ITC determination.
"The ITC finally acknowledged what our members have known since we filed this case in January 2016: that illegally subsidized bus and truck tires coming to our country from China hurt domestic manufacturing and good-paying jobs," Johnson said in a statement.
The retread industry, which faces fierce competition from imports of new Chinese tires, was pleased with the new ITC determination.
"This is good news for the retread industry, but we still have a ways to go before a final determination is made," the Tire Retread & Repair Information Bureau said in a press release.
Interested parties will have the opportunity to comment on the redetermination and reply to those comments. If the CIT upholds the ITC's new determination, the Commerce Department will issue orders to Customs and Border Protection to collect countervailing and antidumping duties against Chinese truck and bus tire imports.
In January 2017, Commerce issued final countervailing duty levels of 38.61 percent against Double Coin Holdings Ltd., 65.48 percent against Guizhou Tire Co. Ltd., and 52.04 percent against Prinx Changshan (Shandong) Tire Co. Ltd. and all other importers.
In antidumping duties, Commerce found margins of 9 percent against Prinx Chengshan and 22.57 percent against Double Coin, Guizhou and all others.
According to Commerce data, the average declared Customs value of a Chinese truck/bus tire was $109.59, 28.4 percent below the average for all imports.