Kogel: 'Quotas would adversely impact market'
"The quotas proposed on Chinese imports would have a significant effect on the market," Ross Kogel, president of Troy, Mich.-based Tire Wholesalers Co. Inc., told the U.S. International Trade Commission during hearings held yesterday, June 2, in Washington, D.C.
"I speak to hundreds of independent tire dealers every month and I have first-hand, grassroots experience in where the tire market is moving and where it has been recently," said Kogel.
"While our business sells many different brands of tires at many price levels, we do a lot of business in the 'Tier 3' replacement tire market. As a result, I have a stake in both sides of this argument. Indeed, our largest supplier is the U.S.-based Cooper Tire & Rubber Co. and our second largest is GITI Tire.
"For my Michigan-based business, the move to limit Chinese tires would be damaging to our business, our customers' businesses, and consumers in Michigan. People in Michigan have seen very hard times recently. The fact is that when they have to -- or should -- replace their tires, Michigan consumers typically look for the Tier 3 economy/value tires.
"Because U.S. replacement tire production is focusing on higher-end tires for the most well-off consumer base, I do not believe that quotas or tariffs on tires from China will create jobs in the tire industry. Such actions will only hurt jobs in my business and many of my customers' businesses, and take away choices for the most-conscious customers.
"Most importantly, I believe there is a misconception that if the number of Chinese tires imported into the U.S. are limited, those sales would be replaced by U.S.-made tires, therefore saving jobs. You can't replace Chinese-made Tier 3 tires with U.S.-made Tier 1 or Tier 2 tires. That's like saying import restrictions on the Kia Sorento would lead Americans to buy Cadillac Escalades. Some folks just want Tier 3 tires.
"In our Michigan business, limiting the number of Chinese tires available to our business would cause a switch from importing Tier 3 Chinese tires to importing Tier 3 South Korean-manufactured, not U.S.-made tires. From what I have seen in my business, tires produced in the U.S. are simply not competitive in the Tier 3 market.
"Limiting Chinese-made tire imports will not result in an increase in sales for U.S.-made tires."