SCHUMER ANNOUNCES, FOLLOWING HIS PUSH, THE INTERNATIONAL TRADE COMMISSION HAS ACTED TO PUNISH CHINA FOR REPEAT TRADE VIOLATIONS THAT HURT WESTERN NY TIRE WORKERS – CHINA IS DUMPING TIRE PRODUCTS INTO U.S. MARKET AT ARTIFICIALLY LOW PRICES & HURTING THE U.S. TIRE MANUFACTURING INDUSTRY; SCHUMER SAYS A HIGH DUTY WILL BE PLACED ON TIRES FROM CHINA TO LEVEL THE PLAYING FIELD
More Than 1,000 Western NY Jobs at Goodyear’s Rubber And Tire Plants in Buffalo & Niagara Falls Are Threatened By China Dumping Tires In U.S. At Artificially Low Prices
Schumer Pushed The ITC To Thoroughly Investigate China’s Tire Producers To Prevent Future Predatory Trade Practices from Hurting US Industry – Says ITC Rightly Acted To Level Playing Field for American Producers And Ensure China Plays By the Rules
Schumer: U.S. Will Protect WNY Workers From Repeat Trade Cheats Like China – Commerce Will Now Issue A High Duty Order on Tires from China, A Major Win For WNY Tire Workers
Today, U.S. Senator Charles E. Schumer announced the U.S. International Trade Commission (ITC) has determined that tire workers in Western New York were unfairly injured from China’s predatory trade practices, a decision that paves the way for high duties on passenger vehicle and light truck tires from China. Schumer said the determination would level the playing field for the more than 1,000 workers employed by the Goodyear Dunlop tire plant in Tonawanda and rubber facility in Niagara Falls. Schumer said this vote will finally hold China accountable for its repeated trade violations.
“The workers at the Goodyear Dunlop tire plant in Tonawanda and rubber facility in Niagara Falls have been unfairly impacted by China’s producers repeatedly selling their tires in the United States at artificially low prices, which is a clear violation of international trade obligations. That is why I urged the ITC to take action to level the playing field, and I am glad that finally a high duty will be placed on tires from China to protect our workers in Western New York,” said Schumer.
Schumer continued, “This vote sends a clear and unequivocal message that the United States will not allow repeat-offender and trade cheats like China to skirt trade rules and hurt American businesses. For the 1,000-plus workers at Goodyear Dunlop in Tonawanda and Niagara Falls, this determination will protect their jobs. It is nearly impossible for an American worker to compete and succeed in the global marketplace while China breaks the rules and employ predatory trade practices – so I will continue to make sure our trade rules are strictly enforced to provide job security for workers across New York and the country.”
“We applaud the ITC for their decision in issuing an affirmative final determination for tariffs on Chinese tires being illegally dumped and subsidized into the U.S. market. The outcome in the USW's pursuit of this case will not only help protect USW members and their families but also helps protect the jobs and futures of the tens of thousands of workers employed within the U.S. tire industry,” said United Steelworkers International President Leo W. Gerard. “The USW thanks Senator Schumer for his support of fair trade and his ongoing backing of New York tire workers.”
“This win will keep thousands of USW members and their families secure for years to come, including those at the Goodyear-Dunlop facility in Buffalo. We can’t thank Sen. Schumer enough for all of his support,” said USW District 4 Director David M. Wasiura.
The combined antidumping and countervailing duties announced by the Department of Commerce on tire imports from China will range between 35.08 and 188.76 percent. China’s actions have caused significant harm to manufacturers in New York and across the country. Between 2011 and the first quarter of 2014, nearly 15 percent of the domestic workers in the tire manufacturing industry lost their job. Schumer said protections that once existed for U.S. producers, that leveled the playing field against trade cheats like China and allowed American worked to compete and succeed in the global marketplace, expired in 2012.
China’s producers were receiving unfair subsidies and selling their tires in the U.S. market at artificially low prices, a predatory trade practice known as dumping. Dumping is a practice that foreign competitors use to undermine domestic producers, in this case more than 1,000 workers at the Western New York Goodyear facilities in Tonawanda and Niagara Falls. Schumer noted that China has rapaciously targeted and injured the U.S. manufacturing base with predatory practices in the past. The antidumping margins announced by the Department of Commerce on imports from China will range from 14.35% to 87.99%. Countervailing duties on products from China will range from 20.73% to 100.77%. The affirmative ITC vote will ensure these rates will apply for the term duty relief.
In 2009, the United Steelworkers asked for and received a Section 421 safeguard, which put a temporary duties on tires from China. From 2009 to 2012, safeguard provisions were put in place to end the temporary flood of imports from China. The domestic industry benefited immensely from the relief the 421 Safeguard provided. However, Schumer said, between 2012 and 2014, after the provision expired, U.S. imports of tires from China jumped more than 84 percent, drastically impacting the U.S. industry.
Suffering from imports from China, last June the United Steelworkers (USW) filed a petition alleging that China’s tire companies were dumping tires on the U.S. market, undercutting U.S. tire producers and workers. Schumer signed a letter with his colleagues in the Senate supporting the USW’s petition and also submitted testimony to the ITC supporting the U.S. tire workers case. The Department of Commerce’s preliminary decision shows that tire manufacturers in New York and across the country have in fact been forced to compete with subsidized and dumped imports from China. The Department of Commerce found in their preliminary decision that China’s producers are dumping tires in the U.S. market at margins ranging from 19.17 percent to 87.99 percent and that China is subsidizing their producers from 30 different programs. Due to this determination, the Department of Commerce imposed a preliminary duty liability on certain tires, and imports from China fell sharply. Following the imposition of the preliminary duties, and the exit of unfairly traded imports, the domestic industry has already begun to recover as domestic producers have increased production, made new investments, extended product lines, and hired more workers.
In order for the domestic industry to continue these improvements and to ensure those gains are not lost, Schumer said the U.S. must provide a level playing field. Schumer said China’s actions could cause further economic harm to U.S. manufactures and that the ITC should act to level the playing field. Due to the ITC’s determination today, China will be held accountable for their repeat trade violations and thousands of manufacturing jobs will be protected.
Dumping is when a foreign company exports their goods into the United States below fair market value. The ITC begins antidumping and countervailing duty investigations by determining if there is a reasonable indication that the US industry has been or could be materially injured by unfair trade practices. After the ITC makes an affirmative decision, the U.S. Department of Commerce investigates dumping margins, typically the difference between the U.S. market price of a product and the price in the exporter’s home country, to determine if dumping has occurred. Positive dumping margins become a duty order if both Commerce and the ITC have affirmative final determinations. The duty order is a type of tax on the import found to be undervalued, which brings the price of that import to fair value.
A copy of Senator Schumer’s testimony submitted to the ITC appears below:
Chairman Broadbent and Members of the Commission:
I write in strong support of the United Steel Workers’ petition for relief from dumped and subsidized imports of passenger and light truck tires from China. I urge you to carefully examine the evidence presented by the United Steelworkers, which demonstrates material injury to the domestic industry. China’s producers have rapaciously targeted and injured the U.S. manufacturing base with predatory practices in the past. The American worker is productive, hard-working and skilled, but to compete on a level playing field we must effectively enforce our trade laws to combat these practices now and in the future.
Goodyear’s tire plant in Tonawanda, NY and Goodyear’s rubber facility in Niagara Falls, NY employ more than a thousand United Steelworker members producing passenger car and light truck tires as well as motorcycle tires. The Goodyear tire plant has been in Buffalo for more than 90 years, sustaining generations of families in our state with well-paid, highly-skilled manufacturing jobs. For over a decade these tire workers have been forced to compete against a flood of tire imports from China.
Since 2004, China’s capacity to produce PVLT tires has increased by 400 percent, while U.S. imports of tires from China have increased by 260 percent. There is substantial evidence that China’s producers increased capacity is a direct result of China’s domestic policies and the generous subsidies that China’s government has provided their tire producers, not to mention the Chinese government’s well-documented manipulation of its currency. In 2009, the United Steelworkers asked for and received the relief they deserved with the implementation of the Section 421 safeguard provision, to put a temporary end to the flood of imports. I applauded the Commission for recommending relief and I strongly supported President Obama’s decision to impose meaningful tariffs on China’s tires for three years.
The domestic industry benefited immensely from the relief the 421 safeguard provided. Once relief was imposed, the U.S. market found the stability it needed as the volume of imports from China fell significantly. The industry saw increases in domestic production, employment, and eventually profitability. However, when the 421 safeguard expired, imports from China rushed back into the U.S. market. From 2012, when the safeguard expired, to 2014, U.S. imports of tires from China jumped more than 84 percent.
The Commission’s data from the preliminary decision shows that tire manufacturers in New York and across the country have suffered significant injury from China’s tire imports in recent years. Between 2011 and the first quarter of 2014, nearly 15 percent of the domestic workers in the PVLT industry lost their jobs despite the economic recovery the United States was experiencing during this period. Suffering from imports from China, last June American workers again asked for relief. Not surprisingly, the Department of Commerce made a preliminary finding that China’s producers were dumping tires in the U.S. market at margins ranging from 19.17 percent to 87.99 percent. Additionally, the Commerce Department found that China’s government was subsidizing the production of Chinese tires. Thirty subsidy programs were preliminarily countervailed by the Department, resulting in subsidy margins ranging from 11.74 percent to 81.29 percent.
Following the imposition of preliminary duty liability, imports from China fell sharply. Monthly imports from China dropped 42 percent in December of last year after preliminary subsidy duties were imposed. In the first quarter of this year, imports from China are more than 63 percent below what they were in the same period last year. As the testimony of many of the Steelworkers shows, following the imposition of the preliminary duties, and the exit of unfairly traded imports, the domestic industry has already begun to recover as domestic producers have increased production, made new investments, extended product lines, and hired more workers.
For the domestic industry to continue these improvements and to ensure that those gains are not lost, I urge you to carefully consider the evidence brought by petitioners in this case. It is clear that if the duties are not in place, China’s producers will again cause economic harm to our industry. As we know from past trade remedy cases, China is an inveterate trade cheat. There are six times as many duty orders in place against China than any other country. There are many steps we need to take to rebalance our trade relationship with China, but the question before this Commission is one of enforcing the laws already on the books. While I am confident that our domestic producers can compete against imports on a level playing field, they cannot compete against foreign producers and foreign governments that refuse to play by the rules.
Again, I urge the Commission to carefully consider the petitioner’s strong evidence that unfairly traded tires from China are injuring our domestic tire industry. Thank you for your attention to this issue and I look forward to continuing to work with the Commission on these important cases.
Sincerely,
Charles E. Schumer
United States Senator
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