By Denna Bowman
A major US trade union is taking legal action to stem the tide of Chinese imported car and van tyres that has led to thousands of job losses at home.
The cheap imports are crippling the domestic tyres industry and have led to plant closures across the US, according to the United Steelworkers (USW).
Leo W. Gerard, USW international president, said: “American workers are struggling to make it through the worst economic crisis in 80 years. Our tyre industry is collapsing under the weight of 46 million Chinese tyres entering our shrinking market annually.”
The petition filed by the USW on behalf of its members employed in the US tyre industry was made under Section 421 of the Trade Act of 1974.
Documents submitted in the case show a huge surge of passenger car and light truck tyre imports from China during 2004-08.
Mr Gerard added: “We are aggressively using America’s trade remedy laws to help workers and their employers combat an import surge from a country not playing by the rules.
“Section 421 is a tool to redress Chinese import surges that gets us through the current economic crisis and preserves a part of America’s industrial base.”
The USW represents about 15,000 tyre workers employed at 13 plants in nine states, which accounts for nearly half of the industry’s production capacity in 2008. The domestic tire industry consists of ten producers with 27 plants in 15 states.
According to the USW petition filed with the U.S. International Trade Commission (ITC), imports of consumer tyres from China increased from 2004 to 2008 by 215 percent in volume and 295 percent by value.
In 2008, China exported nearly 46 million consumer tyres with a value of more than $1.7 billion to the U.S., making it the largest source of consumer tyre imports.
Meanwhile, US domestic production of consumer tyres has dropped by more than 25 per cent.
The latest plant closing was announced last week by Michelin North America of the BF Goodrich unit in Opelika, Al., involving 1,000 workers.
The USW said it seeks to combat the trend by requesting the government to impose an import quota on China of 21 million consumer tyres used on passenger cars, light trucks, minivans and sport utility vehicles per year.
The quota sought by the USW, which would return China tire imports to a 2005 level, would increase five percent per year over a three-year period.
The petition says this would improve domestic job security, enable U.S. tyre makers to regain lost market share, increase production and sales, and allow investment in capital equipment to better compete in the long term.