Tariffs on Imported Steel Affect Tire Industry

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The U.S. Department of Commerce (DOC) is investigating the national security implications of steel imports, and the U.S. Tire Manufacturers Association (USTMA) has testified consumers, as well as the U.S. military, depend on tires and the availability of certain imported steel is critical.

The USTMA, the new name for the Rubber Manufacturers Association, has asked that specific types of tire cord-quality steel wire rod, tire cord and bead wire be excluded from the DOC tariff investigation since domestic suppliers cannot meet volume and quality needs for this vital tire component.

“Tire manufacturing is vital to the U.S. economy,” testified Tracey Norberg, USTMA senior vice president and general counsel. “Tires manufactured by USTMA members safely transport millions of Americans and millions of tons of goods each day throughout the United States. In addition, the U.S. military depends on the tire manufacturing industry to supply tires to protect our national security.”

Virtually all of the steel wire rod used to manufacture high tensile tire cord and bead wire that is consumed in U.S. tire manufacturing plants is sourced from foreign suppliers due to the stringent performance and quality requirements of tire manufacturing, as well as quality and supply limitations of domestic steel wire rod suppliers.

“A disruption in tire manufacturing in the U.S. would harm the U.S. economy, since consistent tire supply is critical to the nation’s shipping and commerce needs, and (it would) threaten national security, since the U.S. military relies on the tire industry to provide high performing and durable tires to aid in our national defense,” Norberg said.

President Donald Trump in April ordered the DOC to investigate whether steel imports were a threat to U.S. national security. While anti-dumping and countervailing investigations are common, The Washington Post reported that investigations studying the connection to national security are quite rare.

Norberg said the production process used by domestic steel mills is unable to manufacture tire cord-quality steel wire rod necessary to make tires for military and civilian applications by domestic tire producers. Tire manufacturers use this steel wire in a tire’s steel belts and in the bead.

“Tariffs or quotas on these products would significantly disrupt the production of tires in the United States, due to quality and supply limitations in domestically producing tire cord-quality steel wire rod to replace imported products,” Norberg said.

Source MTD

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