The U.S. Must Act Only After Careful Consideration when Applying Sanctions on Chinese Tire Imports

Published in Xin Hua
(China) on 11 August 2009
by Li Beiling (link to originallink to original)
Translated from by Amy Przybyla. Edited by Louis Standish.
Involving the value of 2,200,000,000 U.S. dollars in exports, the Sino-U.S. tire protectionism case has continued to be reviewed in the past few days. According to the request from the U.S. United Steel Workers, the U.S. International Trade Committee adopted Chinese tire protectionist measures on June 29th, proposed to impose a 3-year special tariff on China-made tires for passenger cars, light goods vehicles, and the 1st year to the 3rd year extra tariffs are 55 percent, 45 percent and 35 percent respectively.

If the U.S. government accepts this plan to implement sanctions on Chinese tires, this will certainly result in double losses. Regarding China, six A-share companies’ performance in the second half of the year will be affected in varying degrees. Import tariffs in effect are approximately 3.4-4.0 percent, increasing from 35 percent to 55 percent. The Chinese tire businesses' export loss will reach approximately 1,100,000,000 U.S. dollars, while at the same time, this will affect the domestic tire industry and the survival and development of the related upstream and downstream industries, threatening approximately 100,000 workers’ employment.

Speaking of the U.S., tire manufacturing and car manufacturing, as well as consumers, have all become the victims. First, American car manufacturing costs will rise. According to the Ford and the General Motors companies' surveys, if this proposal to raise Chinese tire imports punitive tariffs is accepted one day, the manufacturing cost of every new car and truck that leaves the factory will increase by 150 U.S. dollars. This increase in cost will either weaken the competitiveness of the American automobile market, or increase the American consumer's burden. The U.S. car manufacturing company has no option but to bear the extra manufacturing costs brought from the imposed high tariffs. As a result of the raise in tire prices, U.S. citizens will have to consider re-selecting tire products or even postpone replacing tires, thereby causing potential safety hazards, which is a cause for worry. For whatever reason, the two largest U.S. car manufacturing industry giants - General Motors and Ford - are actively supporting President Obama's veto of this proposition.

Second, regarding China’s tire exports to the U.S., there are considerable shares of products made by American tire manufacturers in Chinese factories or OEM products that are later transported to the U.S. Moreover, in the Chinese domestic tire market, the majority are comprised of American manufacturing companies. The U.S. response to increased tariffs on Chinese tire imports is no different than harming the benefits of American manufacturing. That is the reason why the U.S. Tire Industry Association, which is composed of more than 6,000 small businesses throughout the 50 U.S. states; the American Tire Free Trade Alliance, which is composed of 6 American tire importers; and the U.S. Retail Leader Association, on behalf of the U.S.’s biggest retail merchants and product manufacturers and service suppliers, all publicly oppose the Chinese tire protectionist measures and expect President Obama to veto this proposition in September.

Third, the U.S. sanctions on the Chinese tire industry not only cannot increase employment, but actually will cause more unemployment. On the one hand, this is because Chinese tire exports are low-end products which do not pose a threat to the high-end products produced in the U.S. To use an increase in tariffs to limit Chinese products will make it impossible to bring about a substantial increase in American tire production and sales, and therefore also cannot increase employment. On the other hand, an increase in tariffs will cause a major decrease in Chinese tire exports to the U.S. Chinese companies will abandon the American market. This will certainly lead to the layoff of 100,000 Americans who sell Chinese tires on commission. Professor Thomas Boucher of Rutgers University in America recently pointed out that if the U.S. tire industry gets help from special protectionist sanctions that will save one employment post, it will result in a loss of 25 employment posts, totaling a U.S. loss of 25,000 jobs. Without a doubt, this would result in one misfortune after another for the U.S. employment market.

The unemployment of U.S. tire workers stems from the economic recession in the U.S. and the decline of the automobile industry. For these past few years, the market share of the three big U.S. car companies has shrunk substantially, production and sales have substantially dropped and tire production and sales have had corresponding reductions, resulting in company closures and a large numbers of layoffs and unemployment. With a decrease in market shares, the U.S. does not hold hope on the economic recovery, have not tried to solve problems by subdividing the market, reducing the cost, and increasing competitive power, but have actually gone the wrong way by relying on trade protection, raising the threshold of imports. Is this too shortsighted?!

The imposing of special tariffs on Chinese products by the U.S. is not only a lose-lose situation, it is even contrary to the fair trade principle of the WTO, by encouraging international trade protectionism which causes destruction of the world trade order. The world trade order needs cooperative protection of all participants. The U.S. must act only after careful consideration when applying sanctions on Chinese tires!



美国制裁中国轮胎须三思而后行
2009年08月11日 00:00:34  来源:新华网
李北陵 作者文集

涉及22亿美元出口货值的中美轮胎特保案近日持续升温。根据美国钢铁工人联合会的请求,美国国际贸易委员会于6月29日对中国轮胎采取特保措施,提出了对乘用车、轻型货车用中国制轮胎征收3年特别关税的方案,第1年至第3年额外征收的关税分别为55%
、45%、35%。

美国政府若采纳这个方案,对中国轮胎实行制裁,必是一个双输的结果。对于中国而言, 6家A股公司下半年业绩将受到不同程度的影响;进口关税从现行3.4%-4.0%左右,提高到35%至55%,中国轮胎企业出口损失将达到11亿美元左右,同时还将波及国内轮胎产业及相关上下游产业的生存和发展,约10万工人就业将受到威胁。

对于美国而言,轮胎制造业、汽车制造业以及消费者也将成为受害者。其一,美国汽车生产成本将上升。据福特公司和通用公司测算,若一旦批准对中国进口轮胎加收惩罚性关税的提案,美国的每一辆新出厂的轿车以及卡车的生产成本都将增加150美元。这增加的成本,要么将削弱美国汽车的市场竞争力,要么将增加美国消费者的负担。美国汽车制造商将不得不承受征收高额关税带来的额外成本。美国人将因轮胎价格走高而重新选轮胎产品,甚至推迟更换轮胎,从而埋下安全隐患。这就是为什么美国两大汽车制造业巨头——通用以及福特,积极游说总统奥巴马否决该项提议的原因。

其二,中国输美轮胎中,有相当一部分是美国轮胎制造商在中国的工厂生产或在华贴牌生产后输往美国的。而且,中国国内的轮胎市场,大半被包括美国制造商制造的轮胎所占领。美国对中国进口轮胎加收高额关税,无异于损害美国制造商的利益。这就是为什么遍布全美50个州6000多家小企业组成的美轮胎产业协会、由美国6家轮胎进口商组成的美国轮胎自由贸易联盟、代表美国规模最大的零售商和产品制造商及服务供应商利益的美国零售业领导者协会,均公开反对对华轮胎产品采取特保限制措施,期望美国总统奥巴马9月否决相关裁定的原因。

其三,美国制裁中国轮胎,非但不能增加就业,反而会导致更多失业。这一方面是因为,中国轮胎出口产品多属低端产品,并不对美国生产的高端产品构成威胁,用增加关税来限制中国产品,不可能带来美国轮胎生产和销售的大幅增加,也不能因此增加就业岗位。另一方面是因为提高关税将导致中国输入美国的轮胎产品大幅减少,中国企业将会放弃美国市场,这必将直接导致美国10万经销中国轮胎的美国人下岗。美国罗格斯大学经济学教授托马斯·普吕萨近日指出,美国如果借助轮胎特保措施保住一个就业岗位,结果将会损失25个就业岗位,总计美国将会因此损失2.5万个就业岗位。这对美国就业市场无疑是雪上加霜。

美国轮胎工人失业,源于美国经济衰退、汽车业衰落。这几年,美国三大汽车公司市场份额大幅收缩,生产和销售大幅下降,轮胎生产和销售相应减少,由之导致企业关闭和工人大批下岗失业。市场份额减少,不寄望于复苏经济、振兴汽车业,不从细分市场、降低成本、提高竞争力入手,却在贸易保护、提高进入门槛上动歪点子,这是不是太过短视?!

美国向中国产品征收特别关税不只是双输,更有悖于WTO公平贸易原则,助长国际贸易保护主义,导致世界贸易秩序的破坏。世界贸易秩序,需要参与者共同维护。美国制裁中国轮胎,须三思而后行!



This post appeared on the front page as a direct link to the original article with the above link .

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