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LOS ANGELES TIMEChina files WTO complaint on US tire tariffs
September 15, 2009|David Pierson, Don Lee and Andrea Chang
BEIJING, WASHINGTON AND LOS ANGELES — China's swift challenge to the U.S. decision to slap tariffs on Chinese-made tires has raised concerns over escalating tensions between the trading partners at a crucial time for the world economy.
Beijing lodged a complaint Monday with the World Trade Organization to protest the Obama administration's Friday announcement that it would levy duties ranging from 25% to 35% over the next three years on Chinese tires for cars and light trucks.
That decision came after the U.S. International Trade Commission determined that a surge of Chinese-made tires had disrupted the domestic market and cost the U.S. thousands of jobs.
Beijing accused Washington of protectionism, which could force the WTO to rule on the issue if the two nations fail to reach an agreement after 60 days of negotiations. One day earlier, China said it would launch anti-dumping investigations into imported U.S. chicken and auto products.
Chinese government and industry officials have sternly criticized the tire tariffs in recent days, saying they would cost 100,000 Chinese jobs and $1 billion in exports.
"The protective measures the U.S. government has implemented . . . [are] an abuse of trade remedy measures," Yao Jian, a spokesman for the Chinese Ministry of Commerce, said in a statement.
Chinese tires account for about 17% of the U.S. market. Imports have tripled in the last few years to nearly $2 billion in 2008. Still, many analysts doubt that the tariffs, set to take effect Sept. 26, will do much to bolster U.S. manufacturing or save U.S. jobs.
Tire companies that currently import from China could easily outsource production to other low-wage countries. Some models of well-known brands, including Bridgestone, Cooper Goodyear and Michelin, are made in China.
"Most consumers who bought a Michelin tire wouldn't know if it was made in China or South Carolina, but if they can get one made in China that's $40 less expensive, as long as it's the same tread design and passes the same federal safety standards, it's a good thing for consumers," said Roy Littlefield, executive vice president of the Tire Industry Assn. "It's nice to have that option."
Some tire retailers are furious at the proposed tariffs, which could put new tires out of some consumers' reach. Mike Bogosyan, owner of Five Star Tires in Hollywood, said most of the tires he sells are made in China. He said many of his customers are on a budget and don't care where tires are made as long as they're cheap and safe.