A bipartisan effort from Congress calling for a review of an American tax being assessed on Chinese tire imports is earning praise from the Tire Industry Association (TIA).
“There are few issues that have generated as much member interest as this tariff,” says TIA Executive Vice President Roy Littlefield, adding that “our industry deserves a full and accurate accounting of the effects of the tariff on the entire supply chain, right down to our retailer members.”
U.S. Representatives Dan Boren, a Democrat from Oklahoma, and Texas Republican Kevin Brady have jointly sent a formal letter U.S. Trade Representative Ron Kirk seeking “confirmation that the Obama Administration has established a system” to properly gauge the impact of a 35 percent duty on Chinese-made car and light truck tires.
The import tax was enacted in September.
“From the beginning, TIA has been concerned that that this first-time application of a 421 Safeguard Provision may not properly address the needs for monitoring the effects of this tariff,” says Paul Fiore, the association’s director of government and business relations.
“This (proposed review) brings some sunshine to an as-yet unknown process,” he adds.
The drive toward the duty was initiated by the United Steel Workers union (USW), which contends that allowing unfettered imports of low-priced tires from China threatens the livelihoods of American tire factory employees, leading to domestic plant closures and layoffs.
From 2004 to 2009, according to the USW, more than 8,100 tire manufacturing jobs have been lost as the volume of shipments from China rose 215 percent – representing a 295 percent surge in value at the expense of U.S. tire producers. The benefits of some 35,000 tire worker retirees are also at risk, the union says.
Fiore counters that the USW “made some very far-reaching claims concerning this tariff.” He says Kirk “should be diligent in setting up a comprehensive, verifiable system for quantifying the effects” of the measure.
The World Trade Organization (WTO) is also looking into the matter as China pushes for an investigation.
For more information, visit www.tireindustry.org and www.usw.org.
