The United Steelworkers (USW) is welcoming the U.S. Department of Commerce’s decision to impose preliminary countervailing duties on new pneumatic off -the-road (OTR) tires from China as benefitting from government subsidies.

“Yesterday’s decision is just one step towards holding producers in China to the same standards as everyone else in the global economy,” USW International President Leo Gerard said in a statement released today. “U.S. workers have paid the price for China’s unfair government subsidies for too long. Today’s decision can help redress the unfair advantage that Chinese producers enjoy due to government subsidies in China.”

The Commerce Department found that OTR tire producers in China benefit from subsidies including loans from government-owned banks, tax breaks, government grants, and access to low-cost rubber and land. The Commerce Department found subsidy margins for Chinese tire producers ranging from 2.38 to 6.59 percent.

“The USW will continue to be engaged with this investigation to ensure final margins accurately reflect the full scope of subsidies occurring in China,” Gerard said. “Well be pushing Cina and its tire producers to cooperate with the investigation and provide complete and accurate information on their subsidy programs.”

“In addition,” Gerard said, “we will advocate for the Commerce Department to use the full scope of its authority to counteract subsidies in China. There is absolutely no basis for unilaterally weakening our countervailing duty law in cases involving China, especially since the application of that law has been so long overdue.”

The USW estimate that it represents 70 percent of domestic OTR tire makers with workers employed at Titan production plants employing around 1,355 workers in Des Moines, Iowa, Freeport, Ill., and Bryan, Ohio; plus a total of 4,215 employed at the tire plants of Bridgestone-Firestone in Des Moines and Bloomington, Ill., Denman Tire in Leavittsburg, Ohio, and Goodyear Tire and Rubber in Topeka, Kan, and Buffalo, N.Y.

The Commerce Department’s investigation was initiated in response to a petition filed jointly by the USW and Titan International Inc. in June. The preliminary determination in a companion anti-dumping investigation on OTR tires from China is due in February 2008.

Since 2004, the USW said, “imports of OTR tires from China have risen sharply, while domestic production and employment in the OTR tire industry have fallen.”

Posted 12/12/2007.