When Chinese Rubber Hits the U.S. Road
Washington, DC – Last week the U.S. International Trade Commission ruled affirmatively on a petition from the United Steelworkers on a Section 421 “safeguard investigation” under the 1974 Trade Act.
The petition requested that the Administration cut the number of Chinese tires imported into the U.S., and the ITC is now working on proposed trade remedies that will be presented to President Obama on July 9th.
The petition requested that the Administration decrease imports to 2005 numbers – roughly half of the 46 million units that entered the U.S. in 2008.
“Although these cases often contain baffling tradespeak and legal mumbo jumbo, the issue is simple and critically important to the U.S. manufacturing economy,” states AAM Senior Analyst Kerri Toloczko. “We must address what is truly at stake – jobs and consumer safety.”
“China’s tire industry benefits from government endorsed cheating such as illegal subsidies, ignored environmental standards, exploited labor and undervalued currency,” says Toloczko. “As U.S. manufacturers play by the rules, China’s tires come at a false price and are cheaper in cost and quality. Our manufacturers can’t compete head-to-head – or perhaps ‘cheat-to-cheat.’”
During the 2008 campaign, President Obama committed to assisting domestic industries that have suffered from China’s unfair trade practices. Since 2004, Chinese tire imports to the U.S. have increased 215% and a total of eight U.S. tire production facilities could close in 2008/2009 — bringing the total number of industry jobs lost to around 8,000.
Toloczko continued, “The ITC also considered safety concerns in its decision. In 2005 and 2006, a Chinese manufacturer omitted an important safety strip between belts that keep tires from separating, resulting in numerous U.S. consumer complaints, an ambulance rollover and an exploding tire in Pennsylvania that killed two people and seriously injured two others.”
“Like pet food and toothpaste, another production shortcut taken by a Chinese manufacturer to save money ended up with American consumers hurt – and in this case – killed.”
In addition to trade and safety concerns, the Chinese are also stealing U.S. proprietary production information. Earlier this year, two employees of a Chinese tire manufacturer were caught at a U.S. Goodyear plant stealing trade secrets for a Chinese competitor to Goodyear.
“As industries associated with the U.S. auto industry are already suffering, this relief is needed more than ever. The President must send a message to China that cheating, risking and stealing at the expense of American jobs and safety will not be tolerated,” Toloczko concludes.