Bob Ulrich

Editor

Bob Ulrich was named Modern Tire Dealer editor in August 2000. He joined the magazine in 1985 as assistant editor, and has been responsible for gathering statistical information for MTD's "Facts Issue" since 1993. He has won numerous awards for editorial and feature writing, including five gold medals from the International Automotive Media Association. Bob earned a B.A. in English literature from Ohio Northern University and has a law degree from the University of Akron.

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Will truck tires eventually get additional tariff treatment?

By: Bob Ulrich

Medium/heavy truck tire imports from China are not subject to the new tariffs imposed by President Barack Obama on Chinese tires. Only consumer tire imports are affected.

The president determined that the 215% increase in Chinese passenger and light truck tire imports between 2004-2008 qualified as a "market disruption" under Section 421 of the Trade Act of 1974. As such, it required a remedy -- in this case, additional tariffs of 35%, 30% and 25%, respectively, over the next three years.

Could tariffs on truck tires follow? The answer can be found in the numbers.

From 2004-2005, Chinese truck and bus tire imports to the United States increased close to 55%, from 2.4 million units to 3.7 million, according to U.S. government figures. That would hardly, I would think, cause a market disruption, at least compared to a 215% increase over the same period.

On the other hand, as a percentage of total U.S. truck tire imports, Chinese-made product represented 40% in 2008. That's up from 25% in 2004. By comparison, Chinese consumer tire imports represented 33% of total imports.

Through July of this year, Chinese truck tire imports are down 22%. However, overall truck tire imports to the U.S. are down 38%. The result: Chinese truck tire imports represent almost 50% of all truck tire imports this year.

As a percentage of total shipments in the U.S., Chinese product represents 17% of consumer tire shipments and 19% of truck tire shipments.

(Those Chinese imports, by the way, are predominantly radial; only 15% are bias-ply tires.)

So, is there any chance the United Steelworkers will petition the U.S. International Trade Commission asking for relief from increasing truck tire imports from China? No, because the numbers don't support such a claim.

Not the import numbers. The plant numbers.

The union was able to tie the increase in Chinese consumer tire imports to six plant closings. However, none of them were truck tire manufacturing plants.

Today, eight domestic plants manufacture truck tires. Of those eight, five are union plants.

The Bridgestone Americas Inc. plant in La Vergne, Tenn., is a union plant. It will cease consumer tire production this year, based on excess inventory and the global economic crunch. However, truck tire production at the facility will continue.

As far as the union is concerned, no harm, no foul.

When the president announced the consumer tire tariffs, Phil Schonaerts, president of Phoenix Tire Inc., told me he was worried. "What we're afraid of, quite frankly, is that medium truck is going to go the same route."

He sells Aeolus, Bridgestone, Ohtsu, Sumitomo, Toyo and Yokohama commercial tires. "I deal with an awful lot of independent owner-operators," he says. "Fuel is up, and tires are very expensive."

Don't worry, Phil. The tariff on truck tires imported from China will remain at 4%.

Related Topics: Chinese imports, Truck tire shipments, USW

comments

1. Richard | October 01, 2009 at 01:34AM
   The question is not where tyres come from but the issue of dumping.Some Chinese truck tyres are sold at realistic prices, but some are being sold at,or below the cost of manufacure. This is unfair competition as they cost not only less than a new tyre but also less than a retread and the casing quality is 'questionable',thus leading to environmental concerns.