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Horizon’s Guerrieri: New Tariff Bad for Consumers, Bad Business

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Horizon-Tire-logoResponses from the industry to the United Steelworkers latest action to gain another additional tariff on consumer tires imported from China are beginning to surface.

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On June 2, the USW filed a petition requesting antidumping and countervailing duty relief under Sections 701 and 731 of the Trade Act of 1930, claiming dumping margins as high as 92%.

“Imports have more than doubled to 50.8 million tires last year, and in the first quarter of 2014 alone, imported tires from China surged an additional 24.6% This is a valuable market that China wants to exploit, and action to address this problem is vital,” the USW said.

The USW also claims that this will keep American jobs safe.

A preliminary ruling from the ITC is due July 18.

J. Dale Guerrieri, director of marketing at Houston-based importer Horizon Tire, issued a statement yesterday, claiming the latest Steelworker maneuver “is purely politically driven.”

“I believe that it’s bad for the consumer – a de-facto tax on them via funding the tariffs coming to our government. It will again prove to not help protect U.S. jobs.

“Other countries with factories, such as Thailand, Indonesia, Mexico, Brazil, Taiwan, South Korea, etc., will pick up the slack thus raising the average selling price to the consumer via the resulting impact. Once the post-tariff pricing is raised, most of the non-Chinese product pricing will be raised to be positioned above the Chinese pricing, which will result in the Chinese product’s pricing being slotted in pre-tariff price positioning. In addition, if the Chinese government retaliates via products our corporations are putting into China, our economy will be hurt further.

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“Will it affect our business? Yes, to some degree. It is a fact that we have Chinese-based sourcing via factories owned by them which are located in the Pacific Rim outside of China. We are not locked into the status quo unlike some other Chinese product sources. In addition, it will affect non-Chinese based companies with factories and/or factory production based in China – Goodyear, Cooper, etc. – in that they will have to shift production around.

“In addition, where are the United Steelworkers on medium truck tires and steel wheels out of China? The numbers on those categories coming into the U.S. from China are high, as well! Why (is there) no requested tariff on that product? Could it be that certain parties don’t want to rock the boat of the major U.S. trucking companies, independent owners-operators and fellow brothers Teamsters Union – the trucking industry as a whole? Why not protect Goodyear and Cooper on the truck tire side? Why only passenger and LT (tires)?

“In other words, it’s OK to hit the common citizen on this, but trucking companies, owner-operators, Teamsters, the trucking industry … too much potential backlash there! (They) can’t upset the American trucking industry and Teamster members by causing them higher costs!…Something is really wrong with this picture.”

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At press time today, no comments have been released by as TIA and the RMA, or by tire manufacturers, private brand marketers or tire importers regarding the USW petition.

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