The International Trade Commission ruled Thursday that China has been flooding the U.S. market with its tires. In a 4-2 vote, the ITC found that a surge of low-cost tires from China had disrupted U.S. tire markets. Later this month, the ITC will recommend a trade remedy against China to President Barack Obama, but the President will be free to reject that recommendation and may impose no trade remedy against China.
In its complaint against the Chinese, the United Steelworkers union argued that more than 5,100 U.S. workers have lost jobs because of low-price Chinese tire imports, which grew by 215 percent in volume from 2004 to 2008. The union said that the surge of 46 million tires cost the U.S. $1.7 billion in 2008 alone. It cited tire plant closings in the U.S. by Goodyear, Continental Tire, and Bridgestone/Firestone.
Lawyers representing Chinese tire producers said U.S. companies had already moved out of the low-end, low-margin "tier three" tire market before Chinese manufacturers moved into it. They also pointed out that no U.S. tire producers have joined the steelworkers' complaint.
The ITC is expected to recommend a remedy by the end of this month. President Obama will decide in September whether or not to impose it.
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