ITC set to hear latest USW petition on Feb. 19

Importers and manufacturers of pneumatic truck and bus tires from China are reacting cautiously to the United Steelworkers union's petition to the International Trade Commission for countervailing and antidumping duties against those products.

The ITC has scheduled a Feb. 19 preliminary hearing on the USW's petition, which was filed Jan. 29—the very day officials of the USW and Titan Tire Corp. testified at the agency on their petition for antidumping and countervailing duties against mounted and unmounted off-the-road tires from China, India and Sri Lanka.

The petition specifically excludes recycled, retreaded and solid rubber tires.

In its petition, the USW said U.S. and Chinese truck and bus tires are essentially interchangeable, offered along the same array of sizes and products including steer, drive, trailer and all-position tires.

All types of truck and bus tires share common production facilities, production processes and employees, according to the petition. Customers and producers alike perceive all truck and bus tires as similar products, and they are offered along a continuum of prices, it said.

The USW represents workers at five of the eight truck and bus manufacturing facilities in the U.S., encompassing approximately 6,000 workers and some 66.8 percent of daily domestic truck and bus tire manufacturing capacity, the union said.

Quoting the ITC's figures, the USW said during the first nine months of 2015 China imported 6.7 million truck and bus tires to the U.S. with a Customs value of $817.6 million. This compared with 6.3 million tires worth $1.03 billion imported to the U.S. during all of 2012, it said.

“From 2012 to 2014, the U.S. imported from 6.3 to 8.4 million truck and bus tires a year from China, valued at close to or over a billion dollars each year,” the petition said. “China imported more tires to the U.S. than all other countries combined throughout the period.”

During the same period, China undersold U.S. producers of truck and bus tires at margins averaging from 57.38 to 62.25 percent, the petition said.

“While demand rose by 1.8 million tires, or 8.45 percent, from 2012 to 2014, imports from China grew even more rapidly, growing by 2.l million tires or 33.33 percent,” it said. “As a result, domestic producers saw their shipments decline by 800,000 tires, or 7.48 percent, and they participated in none of the demand growth over the period.”

Chinese government subsidies

The wide array of government subsidies available to Chinese truck and bus tire manufacturers dovetails with the Chinese government's “Tire Industry Policy” that encourages radial tire development in China and encourages the adoption of new tire technologies, according to the petition.

Also, the announced expansions of tire production in China only will exacerbate existing overcapacity in that country, it said.

“Based on the information reasonably available to the petitioner and presented in these petitions, truck and bus tires from China are being dumped in the U.S. market, they benefit from considerable subsidies, and they are causing and threatening to cause injury to the domestic truck and bus tire industry,” the USW concluded.

Truck and bus tire manufacturers and importers—including Goodyear, Cooper Tire & Rubber Co., and Giti Tire (USA) Ltd.—either declined direct comment on the petition or said any comment was premature.

“As a global company with operations in all regions, Goodyear is a proponent of free and fair trade across the globe,” a company spokesman said.

The new petition marks the fifth time in less than a decade that the USW has sought relief against tire imports, including both the current truck/bus and OTR tire petitions.

In 2007, Titan Tire and the USW filed a joint petition with the ITC for antidumping and countervailing duties against certain Chinese OTR tires, and won their case the following year.

In 2009, the USW requested relief under Section 421 of the Trade Act from a rapid upsurge of Chinese passenger and light truck tire imports. In September of that year, the Obama administration imposed three years of high tariffs against those imports.

In June 2014, the union petitioned the ITC for relief against the same passenger and light truck tires, saying Chinese imports skyrocketed at virtually the moment the Section 421 tariffs lapsed. In July 2015, the ITC voted 3-3 to find material injury, and the Commerce Department set final countervailing and antidumping duty levels the next month.

“Once again we are taking action to stop the unfair trade practices of China from damaging our members' good jobs and the U.S. manufacturing base,” said USW International President Leo W. Gerard in a Feb. 1 news release. “Chinese dumping and subsidization totally distort the U.S. market in tires and in many other manufactured products.”