SCHUMER PUSHES TO PROTECT U.S. TIRE WORKERS IN WESTERN NY, WHO ARE VICTIMS OF UNFAIR IMPORTS FROM CHINA – FED PRELIMINARY INVESTIGATION INDICATES THAT CHINA IS DUMPING TIRES AND HURTING THE US INDUSTRY; NEXT STEP IS FOR DEPT. OF COMMERCE & INTERNATIONAL TRADE COMMISSION TO DETERMINE POTENTIAL ACTION TO LEVEL PLAYING FIELD

Schumer Says The Jobs of More Than 1,000 Western NY Residents Who Work at Goodyear’s Rubber And Tire Plants in Buffalo & Niagara Falls Are At Risk If China’s Unfair Tactics Targeting of US Tire Industry Continues 

The International Trade Commission (ITC) Determined Domestic Tire Producers Have Suffered Severely From China’s Tire Imports Since Tariffs That Once Protected U.S. Manufacturers Expired – Schumer Pushes the ITC to Consider Strong Evidence of Industry Injury & Act to Level Playing Field for American Producers Once Again

Schumer: WNY Goodyear Tire Workers Can Compete With All, But We Must Do All We Can To Protect Them Against Trade Cheats Like China

U.S. Senator Charles E. Schumer today urged the U.S. International Trade Commission (ITC) to act decisively to level the playing field for tire imports to protect U.S. tire workers in Western New York from unfair Chinese trade practices. Schumer said there are over a thousand New Yorkers employed by Goodyear Dunlop’s tire plant in Tonawanda and rubber facility in Niagara Falls – who produce passenger car and light truck tires —who impacted by unfairly-priced tire imports from China.

Schumer explained that the ITC’s preliminary decision showed that  tire manufacturers in New York and across the country have suffered significant injury from China’s unfairly-supported tire imports in recent years. Between 2011 and the first quarter of 2014, nearly 15 percent of the domestic workers in the tire manufacturing industry lost their jobs despite the American economic recovery.  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 and this report provides further evidence that the Department of Commerce and ITC must work to level the playing field for U.S. manufacturers.

“From tires to steel to stealing intellectual property, the bottom line is that China is a repeat-offender trade cheat; and the 1,000-plus productive and talented workers at tire manufacturers like Goodyear Dunlop in Tonawanda and Niagara Falls need the Department of Commerce and ITC to be the cop on the beat and level the playing field for the American worker. More than 1,000 hard-working Americans’ jobs are being put at risk because they are forced to compete with artificially-cheap foreign imports, and that needs to change ASAP,” said Senator Schumer. “American manufacturers and workers can compete and win, but it is essential that foreign competitors – especially from China – play by the same rules. So I am urging the feds to consider the substantial evidence of damage caused by foreign dumping and act decisively to impose protections that will ensure U.S. workers can compete on a level playing field.”

“Some 28,000 American  workers producing PVLT tires, including more than 900 in the Buffalo-area, can compete with any worker in the global market given a level playing field,” said USW International President Leo W.  Gerard. “Unfortunately, illegal subsidies and dumped goods  from China threaten good-paying,  family-sustaining American manufacturing jobs. The USW thanks Senator Schumer for his support of fair trade and his ongoing backing of New York tire workers.”

In 2009, the United Steel Workers to implement the Section 421 safeguard provision, which put a temporary end to the flood of imports. From 2009 to 2012, safeguard provisions were put in place to end the temporary flood of imports specifically 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. 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. 

Schumer said that for the domestic industry to continue these improvements and to ensure that those gains are not lost, the US must ensure a level playing field. Schumer urged the ITC to carefully consider the evidence that US producers have been injured by imports from China. The ITC will have the final say in determining whether duties should be placed on China’s tire imports. Schumer said it is clear that if necessary duties are not in place, China’s producers will cause economic harm to the U.S. manufacturers. Schumer noted that China has a history of violating their international trade obligation and targeting the US manufacturing base as there are six times as many duty orders in place against China than any other country. Schumer said that there are many steps that need to be taken to rebalance the US trade relationship with China, like addressing China’s currency manipulation, but the question before this Commission is one of enforcing the laws already on the books. That is why Schumer is urging the ITC to carefully consider the strong evidence that unfairly traded tires from China are injuring our domestic tire industry and act decisively to level the playing field for American workers. Earlier this month Goodyear announced that Sumitomo Rubber Industries would take over operation of the Goodyear Dunlop tire plant in Tonawanda. For last 16 years the plant has operated as a joint venture between Sumitomo and Goodyear, with this recent announcement Sumitomo will operate the plant and Goodyear will retain the rights to sell the Dunlop brand.  

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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