Washington — The US Department of Commerce has voted to initiate antidumping (AD) and countervailing duty (CVD) investigations to determine whether passenger and light truck (P/LT) tires from South Korea, Taiwan*, Thailand and Vietnam are being dumped in the US.
Commerce's decision is in response to petitions filed in early May by the United Steeworkers union (USW), which claim tire producers from these regions are dumping their products in the US at margins ranging from as low as 5.48% (Vietnam) to as high as 217.5% (Thailand).
The CVD investigation will focus on Vietnam, Commerce said, in order to determine whether producers of P/LT tires in Vietnam are receiving unfair government subsidies.
Commerce came to its conclusion after reviewing thousands of pages of testimony submitted by both the USW and importers, tire wholesalers, tire producers and foreign government entities submitted in late May/early June.
Commerce said it will investigate 20 subsidy programmes, including tax programmes, government provision of goods for less than adequate remuneration, import substitution subsidies, grants, government provided loans and Vietnam's allegedly undervalued currency.
This is the first time that Commerce has ever initiated an investigation of alleged currency subsidies in relation to a foreign currency with a single exchange rate.
If Commerce makes affirmative findings in these investigations, and if the US International Trade Commission (ITC) determines that dumped and/or unfairly subsidised imports of P/LT tires from South Korea, Taiwan, Thailand and Vietnam materially injure, or threaten material injury to, the US industry, Commerce will impose duties on those imports in the amount of dumping and/or unfair subsidisation found to exist.
The value of P/LT tire imports in 2019 from the targeted countries and Taiwan were approximately valued as follows:
• $1.96 billion (€1.73 billion) for Thailand;
• $1.17 billion for South Korea;
• $496.6 million for Vietnam; and
• $373 million for Taiwan.
Commerce said its preliminary investigation shows dumping percentages of:
• 42.95% to 195.2% for South Korea;
• 20.57% to 116.14% for Taiwan;
• 106.36% to 217.5% for Thailand; and
• 5.48% to 22.3% for Vietnam
Foreign companies that price their products in the US market below the cost of production or below prices in their home markets are subject to AD duties.
Foreign companies that receive financial assistance from foreign governments that benefits those companies' production of goods, and is limited to specific enterprises or industries, or is contingent either upon export performance or upon the use of domestic goods over imported goods, are subject to CVD duties.
*Taiwan is not officially recognised by the United Nations, the US and most major industrialised countries as a separate, sovereign nation. Instead, the UN and most nations refer to Taiwan as an economic zone or entity.