WASHINGTON — The United Steelworkers (USW) said it is pleased that the International Trade Commission (ITC) has moved forward on the union’s Section 421 petition, ruling by a 4-2 vote that a surge of low-priced and unfairly traded consumer tires from China is harming the domestic industry. This import surge has caused major job losses and plant closures in the United States, according to the USW.

"Our domestic industries cannot survive unless our government enforces the trade laws designed to curb and dissuade anti-competitive practices that cause market disruptions," said USW International President Leo Gerard. "We anticipate the remedies that will be delivered to President Obama will allow the time necessary to rebuild the U.S. tire industry."

President Obama will make the final determination on imposing trade relief.

The USW filed a petition with the ITC on April 20 that sought relief under Section 421 of the Trade Act of 1974. Section 421 is a temporary country-specific safeguard that China agreed to as part of its bilateral trade negotiations with the United States leading to its 2001 membership in the World Trade Organization.

The USW petition claimed that imports of consumer tires 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 tires with a value of more than $1.7 billion to the U.S., making it the largest source of consumer tire imports. While imports nearly tripled by volume during the surge period, domestic production of consumer tires declined by more than 25 percent.

During this period, nearly 5,100 U.S. tire workers have lost their jobs as a result of massive erosion in the domestic production that coincided with the massive increases in imports of consumer tires from China. About 3,000 more jobs are slated to be lost by year’s end as three plants are threatened to close. Whether the remedies will be established at a sufficient level to save these jobs and plants is a question that the USW and others await the answer.

To combat this trend, the USW said it believes that the government should impose an import quota on China of 21 million consumer tires used on passenger cars, light trucks, minivans and sport utility vehicles per year. This would return Chinese tire imports to a 2005 level and allow for an increase of five percent per year over a three-year period.

"We anticipate that the final decisions on remedies will improve domestic job security, increase production and sales, and allow for investment in capital equipment to better compete in the global market for the long term," said Tom Conway, USW International vice president.

Conway, chairman of the bargaining committee at Goodyear, said the company has warned the union since 2003 that low-cost imports were threatening its North American operations. "USW-represented tire workers have made painful concessions and the union bargained hard to make sure our plants received the capital investments to stay on the cutting edge of technology and innovation. Without strong remedies from the President, our work will be for naught and the opportunity to build a stronger domestic industry will be lost."

 Chinese tiremakers and exporters have been actively fighting the allegations with assistance from local industry associations and the Ministry of Commerce. In addition, the Tire Industry Association (TIA) has said it does not support efforts to limit the import of Chinese tires. The association said it “feels strongly that this measure, despite being well-intentioned, would not help in the preservation of manufacturing jobs, and would be harmful to consumers, as these tires are often an affordable solution to those drivers with limited budgets.”

TIA also noted its long-standing position that all tires – regardless of country of origin – must be held to all applicable Federal Motor Vehicle Safety Standards.