National Press Release

All Urge Commission to Stem China Tire Import Surge

WASHINGTON, June 2 /PRNewswire-USNewswire/ -- United Steelworkers (USW) International President Leo W. Gerard today asked the U.S. International Trade Commission (ITC) to give the U.S. tire industry a "fighting chance" to survive the waves of low-priced and unfairly traded imports of consumer tires flooding the domestic market from China.

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Gerard and other USW officers on the trade petition that seeks to stem those imports and rebuild the domestic industry. Members of Congress also testified and dozens of tire workers from affected plants sat in the hearing room.

Senators Robert Casey and Arlen Specter of Pennsylvania and other Democratic lawmakers argued before the commission that the case is a chance for President Barack Obama to chart a new course for U.S. trade policy.

"It is my hope that the Obama administration will go in a new direction and enforce the trade laws," Casey testified. Sen. Sherrod Brown said: "An affirmative decision by the Commission, followed by relief by the president, would signal that our government intends to enforce these rules to curb and dissuade anti-competitive practices."

Since 2004, nearly 5,100 U.S. tire workers have lost their jobs as a result of massive erosion in the domestic market since 2004 that coincides with massive increases in imports of consumer tires from China. About 3,000 more jobs are slated to be lost by year's end as three plants are threatened to close.

The USW filed a petition with the ITC on April 20 that seeks relief under Section 421 of the Trade Act of 1974. Section 421 is a temporary country-specific safeguard that China agreed to as part of its bilateral trade negotiations with the United States leading to its 2001 membership in the World Trade Organization.

When Congress passed Section 421 in 2000, it did so because of the concern that, during China's continued transition from a non-market economy to a more market-based economy, distortions and state intervention would result in rapid surges of exports that would irreparably harm U.S. industries.

If the ITC finds that U.S. companies are being harmed, the final determination on imposing trade relief will be made by President Obama, who made a campaign pledge to crack down on China's unfair trading practices.

Gerard told the ITC that the union has used every tool at its disposal to save the consumer tire industry from total collapse including contract concessions, wage increase deferrals and improved productivity.

"But all of these efforts aren't worth a dime if the market is being pulled out right from under us," Gerard said. "With a short period of relief, we can start to build a sustainable foundation for the future of the American tire industry and its workers."

USW International Vice President Tom Conway, chairman of the bargaining committee at Goodyear, said the company has warned the union since 2003 that low-cost imports were threatening its North American operations.

"Our union has made painful sacrifices to keep our companies afloat in a sea of cheap imports from China," Conway said. "We have also worked hand-in-hand with our companies to ensure they keep investing in our facilities so we can stay on the cutting edge of technology and innovation.

"But the tide is rising, and it threatens to overwhelm all of the hard work we've put into this industry. We're here today to ask the Commission to give us enough breathing room that we can start to build on that hard work and create a stronger and more resilient industry for the future."

Ron Hoover, retiring as executive vice president for the USW's Rubber and Plastics Industry Conference, warned the ITC that continued unfair imports will jeopardize non-profit trust funds that pay the medical bills, prescriptions and other benefits to 35,000 retirees and their families.

The Voluntary Employee Benefits Associations (VEBA) are funded by company profit-sharing contributions and increased premiums, cost-of-living wage deferrals and concessions from employees.

When companies can't profitably compete because the market is flooded by low-priced imports, profits shrink and disappear. That leads to production cutbacks and plant closures. Both directly impact VEBA funding, Hoover said.

"Active workers have sacrificed benefits they are entitled to today in order to make good on these commitments to our retired workers and in order to invest in their own retirement benefits for the future," Hoover said.

Until it closed last year, Goodyear's Tyler, Texas, plant made smaller sized tires for the private label market, the type of tires China targeted when it first entered the market. Tyler's 1,100 jobs have all disappeared.

Tyler is one of six consumer tire factories that have closed in the United States since 2004. Gerard said at least 3,000 more jobs are on the line at plants in Georgia, Tennessee and Alabama.

Tyler had a culture of strong employee participation. The local union worked closely with management to make the plant a cutting-edge facility, said Jim Wansley, the retired president of USW Local 764L at Tyler.

Despite the fact that Tyler was a leader in productivity, safety, waste and other manufacturing measures, it could not compete against Chinese tires that Wansley said seemed to be priced slightly above raw material costs.

"I am here today in the hopes that my brothers and sisters at other plants around the country will not have to suffer the same fate our plant did," said Jim Wansley, the retired president of USW Local 764L at Tyler.

"Imports from China closed our plant, and they will close more if the industry does not get relief."

Stan Johnson, USW International Secretary-Treasurer and the newly-installed chair of the Rubber & Plastics Industry Conference, also participated in the hearing and responded to commission questions as an expert witness.

CONTACT: Gary Hubbard, (202) 778-4384, (202) 256-8125 (c)

SOURCE United Steelworkers (USW)