USW opted for no extension of Chinese tariffs

ERJ staff report (TB)

Washington DC - With the elevated US tariffs against Chinese passenger and light truck tyres set to expire on Sept. 26, the United Steelworkers (USW) union has affirmed it did not seek an extension of the tariffs, although a one-year extension was possible under international law.

The USW, whose petition to the International Trade Commission (ITC) in April 2009 under Section 421 of the Trade Act set the stage for the elevated tariffs, said in a statement released Sept. 24 that it opted back in March - in advance of a six-month renewal request deadline - not to request an extension.

The USW's petition sought relief against a surge of Chinese tyre imports. The ITC found evidence of material injury against US tyre makers and workers, and on Sept. 26, 2009, President Obama granted relief in the form of three years' worth of tariffs.

Those tariffs totaled 39 percent the first year, 34 percent the second and 29 percent the third. The tariffs will revert to their previous, traditional level of 4 percent on Sept. 26.

“In his January State of the Union message, President Obama highlighted the success of the 421 relief he authorised for America's passenger and light truck tyre producers and its workers,” said USW International President Leo Gerard,

“Since his decision, by every measure, success has been achieved,” Gerard said, claiming that “jobs have been retained and created, production has rebounded, investments in plant and equipment have been made and many companies have returned to profitability.

“That's why the law was enacted, and it worked.”

Most tyre industry sources and other observers dispute the efficacy of the tariffs.

Under international trade law, a fourth year of tariffs might have meant that the US would have had to pay compensation to China, according to Gerard. “We refused to pursue an option that could potentially reward China for their actions,” he said.

From Tire Business (A Crain publication)

Press release from USW