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Posts Tagged ‘U.S. International Trade Commission’

Deadline Nearing on Chinese Tire Sanctions

Contentious issue puts President between the largest holders of our debt and the ongoing loss of U.S. manufacturing jobs.

by on Sep.08, 2009

The political rubber is about to meet the trade (offs) road.

The political rubber is about to meet the trade (offs) road.

The United Steelworkers (USW) today updated the White House on this year’s sharp spike of “accelerating” Chinese tire imports.

According to preliminary government data for August, there’s been an extraordinary increase of passenger and light truck tire imports into the U.S. of 57% when compared to this year’s first four months leading up to the April petition filing by the USW, which that sought relief under Section 421 of the Trade Act of 1974.

The U.S. International Trade Commission (USITC) said in late June that tariffs should be implemented on the 46 million tires imported annually from China because of the harm done to the U.S. industry.

If the Obama Administration bows to Chinese lobbying pressure, made all the more  potent since China is our largest holder of U.S. government debt, then it will disappoint organized labor, which helped propel it into office.

More is at stake here than just rubber worker jobs. The U.S.  — without a senior level ministry to look after job creation as part of a larger industrial policy – is alone among all other large  trading nations.

“We fear that the ITC’s recommended relief will be inadequate for this huge spike of imports, and that September will be even worse,” said USW President Leo Gerard. Ever since the ITC’s June finding of market disruption, we have watched with alarm as the Chinese have cranked up their exports of tires to beat the date any remedy is applied.”

Section 421 is a safeguard that China agreed to as part of its bilateral trade negotiations with the United States leading to China’s 2001 membership in the World Trade Organization.

Gerard testified last month that China tire imports had swelled in July to more than 42% over the same period from January to April.

Gerard said today, “This is yet another attempt to defeat the beneficial effects of a trade remedy designed to address the market disruption and harm already caused by these imports. The current imports spike from China will hurt U.S. workers further if not addressed in the President’s remedy decision.”


Tire Shipments Drop More than Expected

Industry is reeling as the U.S. Trade Representative considers tariffs against Chinese-made tires that undercut the market.

by on Aug.10, 2009

Union City, TN plant, Courtesy of Goodyear

Tires leave the curing presses and find their way to an associate in Goodyear's Union City, Tennessee plant.

U.S. tire shipments are projected to drop by approximately 16% in 2009, mostly as a result of a nearly 45% decline in Original Equipment Manufacturer (OEM) passenger tires and almost 43% drop in OEM Commercial truck tires, according to the latest numbers from the  Rubber Manufacturers Association.

Total 2009 tire shipments are projected to decline approximately 45 million units to 237 million units. This level is approximately 84 million units less than the peak of 321 million units in 2000. The decrease in tire shipments reflects the recent struggles of automotive manufacturers, low consumer confidence, high unemployment, and depressed home values, the trade group says.

The latest blow to the struggling industry comes as the U.S. Trade Representative is considering imposing tariffs on the imports of Chinese tires after the International Trade Commission (ITC) found that tariff relief was necessary to reduce tire imports.

The USTR remedy recommendation will be delivered to President Obama by Sept. 2, 2009. The President’s decision on how to respond to surging tire imports from China, which has resulted in massive job losses and factory closures, is due on September 17th.

Like so many candidates, Senator Obama talked tough about protecting U.S. jobs and trade during the campaign, but there’s been slight evidence that President Obama differs in any significant way from the Bush Administration’s disastrous economic policies on trade. The Steelworkers, of course, were one off candidate Obama’s strongest supporters.

ITC commissioners last month found a market disruption and recommended that tariffs be placed on passenger and light truck tires from China – 55% in year one, 45% in year two and 35% in year three.

The United Steel Workers Union, which brought the legal action, claims it is urging a higher tariff in the first year so domestic tire workers get the full relief prescribed to prevent the frontloading of inventories by Chinese exporters or U.S. importers who are dumping higher volumes prior to the President’s decision.


ITC Rules China’s Largest Tire Maker is Illegally Dumping in the U.S. and Killing American Jobs

A crucial test for the Obama Administration on trade policy is coming by the September deadline for Presidential action.

by on Jun.30, 2009

United Steelworkers International President, Leo Gerard

During the last five years, about 5,100 U.S. tire workers lost their jobs.

The U.S. International Trade Commission (USITC) said yesterday it will propose to President Obama that tariffs be implemented by the Administration on the 46 million tires imported annually from China.

The latest action follows the Commission’s June 18th ruling that a market disruption exists, and it is harming U.S. industry.  Simply put, without getting into a meaningless legal definition debate, we interpret this as saying China is dumping tires illegally in the U.S. under international trading rules.

The ITC investigation was prompted by a union complaint from the United Steel, Paper and Forestry, Rubber, Manufacturing, Energy, Allied Industrial and Service Workers International Union (USW). The USW complaint asking for tariff relief was filed under Word Trade Organization rules that China has agreed to be governed by.

The USW filed a petition with the ITC in April that sought relief under Section 421 of the Trade Act of 1974. Section 421 is a temporary, country-specific safeguard that China agreed to as part of its bilateral trade negotiations with the United States leading to China’s 2001 membership in the World Trade Organization.