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Taxed Import

Consumers could feel brunt of U.S. tariffs on Chinese tires

September 27, 2009
By MIKE ZUMMO, The Leader-Herald

With the U.S. government's tariff on imported tires from China having gone into effect Saturday, one retailer said it's too soon to gauge the effect it will have on business.

Joe Polidore, owner of the Tire Center in Johnstown, said he doesn't do a lot of business with Chinese tires, but he said customers who purchase them are looking for tires at lower prices, and the customers could end up being the loser in the government's trade debate with China.

"Price is the main thing," Polidore said. "Sometimes you can get them in at a very good price. And the quality is not bad. The ones that I've gotten have never had a problem."

Article Photos

The Leader-Herald/Bill Trojan

Andy Duffek, a tire changer at the Tire Center in Johnstown, places weights onto a customer’s tire in the balancing process at the shop Wednesday.

Earlier this month, a federal trade panel recommended a 55 percent tariff in the first year, 45 percent in the second year and 35 percent in the third year. However, President Barack Obama settled on slightly lower penalties - an extra 35 percent in the first year, 30 percent in the second, and 25 percent in the third, White House press secretary Robert Gibbs said Sept. 11.

The U.S. trade representative's office said four tire plants closed in 2006 and 2007 and three more are closing this year. During that time, just one new plant opened. The United Steelworkers brought the tire case to the U.S. International Trade Commission in April, and says annual imports should be capped at 21 million. The union says 5,000 American tire workers have lost their jobs since 2004.

"I guess I believe in the free enterprise," Polidore said. "I don't want to see anybody out of work, but I'm most concerned for our customers."

The United States imported about 46 million tires from China last year, three times as many as in 2004. In that time, China's share of the U.S. market went from less than 5 percent to almost 17 percent.

"When China came in to the [World Trade Organization], the U.S. negotiated the ability to impose remedies in situations just like this one," U.S. Trade representative Ron Kirk said. "This administration is doing what is necessary to enforce trade agreements on behalf of American workers and manufacturers. Enforcing trade laws is key to maintaining an open and free trading system."

The safety of Chinese tires had come into question in recent years, and in 2007, several brands were recalled due to a split in the tire tread.

Polidore, however, vouched for the safety of the tires, and if there are any problems, the tire distributor usually takes care of it.

"As the person directly involved with the customer, I know people are going to back me up if there's a problem," he said. "The most important thing is that it's safe, and if a customer has a problem, getting it taken care of is the main thing."

Several area businesses don't carry Chinese tires and will be unaffected by the imposed tariffs.

"We try to keep the money local," said Dan Hohenforst, manager of Apollo Northeast Sales and Service in Johnstown. "That's not to say you can't get them locally, but we do mostly truck tires here."

An employee at Adirondack Tire in Amsterdam also said the shop does not carry imported tires from China.

Polidore expressed concerns about the tariff outside of the tire business.

"I'm just afraid what they're going to do with things we export to them," he said.

Two weeks ago, Beijing announced it would investigate complaints that American auto and chicken products are being dumped in China or benefit from subsidies.

Meanwhile, Polidore said he is keeping his fingers crossed, hoping the imposed tariffs won't have a negative effect on his own business.

The Associated Press contributed to this report.



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