Titan thanks US government for ‘diligence’ in reviewing tyre subsidies

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Titan International has commented on the final results of the US Department of Commerce’s (DOC) review of imported OTR tyres from China in 2014 and 2015, which show the Chinese government increased the level of subsidies it gave tyre makers, enabling their products to continue selling in the US market at what the tyre maker calls a less than fair value.

“These results confirm our belief that the levels of government subsidisation had significantly increased and that the amount of dumping has continued,” said Paul Reitz, president and chief executive officer of Titan International. “The continued monitoring by the DOC of these orders and the imposition of accurate amounts of countervailing and antidumping duties is an important step in restoring conditions of fair trade. We will continue to work with the DOC to insure that any and all subsidisation and dumping by Chinese producers is met by appropriate duty levels. We have been fighting and will continue to fight against the unfair trade practices of any US trading partners.”

The results’ release updates the level of duties imposed on OTR tyre imports to counteract the most recent levels of subsidisation and dumping identified by the Department of Commerce. The identified levels of subsidisation have increased dramatically since they were last analysed. Specifically, the department found subsidy levels, which previously ranged from 2.52 per cent to 5.65 per cent, to be 34.46 per cent to 46.01 per cent in the recent review. The Department of Commerce has also continued to find that Chinese producers are selling at amounts significantly below their costs.

Read the source article at Tyrepress

Chinese carmakers may be ‘destroyed’ if foreign investment cap lifted

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SHANGHAI — Chinese government-owned auto giants such as SAIC Motor Corp. and Dongfeng Motor Group Co. may see billions of dollars in profits evaporate if the government lifts protectionist measures and lets foreign companies operate without a local partner.

China requires overseas carmakers such as General Motors, Toyota Motor Corp. and Volkswagen AG to form joint ventures with locals in order to sell their brands in the world’s biggest market. The policy enacted two decades ago capped foreign investment at 50 percent, helping local brands develop manufacturing expertise while still profiting from sales of foreign marques.

Those alliances seem to be working for domestic automakers, which earned 67 billion yuan ($9.7 billion) with their partners in 2014, according to the latest China Association of Automobile Manufacturers statistics. Yet the government may relax the restriction as it tries to make state-run businesses more efficient and to respond to changes in trade policy being pushed by U.S. President Donald Trump.

“Automakers that aren’t competent enough would be destroyed by the policy change,” said Cui Dongshu, secretary general of the China Passenger Car Association. “Rising competition from not only the foreign joint ventures but also from homegrown makers has been weighing on the weak performers.”

The prospect for lifting the restrictions comes as carmakers meet in Shanghai this week for Asia’s biggest auto show. Ford Motor Co. and Hyundai Motor Co. are among the other foreign carmakers displaying models that compete with those produced by local partners.

Less than half the record 23.9 million cars and light trucks sold in China last year were local brands. Market share for Chinese-brand cars has stayed fairly constant, reaching 43 percent last year from 41 percent a decade ago, according to the state-backed manufacturers association.

Read the source article at Front Page

Brunei: Reconsider rubber tax

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THE Brunei Government has introduced a tax on rubber-related products. It was not explained why it needed to do this.

The products include stationery items like erasers, rubber bands etc. The tax will be between three to five per cent. This will burden the schools and the students. In these hard times we shouldn’t be burdening the families by making basic school necessities costly, especially for the low income families.

At present companies selling stationery items from Miri are active in Brunei and have taken a huge share of the stationery market. This has badly affected local businesses selling stationary items.

Read the source article at Global Rubber Markets News

Jim Cramer – 6 things causing the market’s spring slowdown

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For Jim Cramer, Thursday’s big bank earnings reports could not be more important to this ailing market. For over 36 years, the stock market has edged up, resulting in overall higher prices and an eight-year streak of bullish sentiment. “But every big move, every move that had really any impact, always had the banks as one of the major leadership groups,” the “Mad Money” host said.

 

Read the source article at cnbc.com

Michelin Drives Tire Safety Action with AAMVA Best Practices Update

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GREENVILLE, S.C., March 20, 2017 /PRNewswire/ — Michelin and the Federation Internationale de l’Automobile (FIA), the global governing body for motorsports, have secured the commitments of 40 U.S. states and the District of Columbia to include standard tire-safety information in driver’s manuals as part of Michelin’s award-winning Beyond the Driving Test program.  The 40-state achievement comes as the American Association of Motor Vehicle Administrators (AAMVA), which represents officials in states, provinces and territories engaged in the administration and enforcement of driver and motor vehicle laws in the United States and Canada, releases its updated Best Practices for its members to include consistent language for proper tire pressure and tread depth. 

 

Read the source article at Stock Market

One vote altered final ITC antidumping decision

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WASHINGTON — The shift of one vote caused the International Trade Commission (ITC) to make a final determination that the U.S. truck and bus tire manufacturing industry is not being materially injured because of imports from China.

The ITC made a negative determination on material injury against the U.S. truck and bus tire industry Feb. 22 on a 3-2 vote. A year earlier, the commission made an affirmative preliminary determination by a 3-2 vote.

The ITC made its final report available to the public on March 22.

ITC Vice Chairman David S. Johanson voted with Chairman Rhonda K. Schmidtlein and Commissioner Irving A. Williamson in the preliminary determination in favor of a finding of material injury. At that time, however, Mr. Johanson filed his separate views.

In his preliminary views, Mr. Johanson agreed with most of the findings of Ms. Schmidtlein and Mr. Williamson. He found that Chinese imports increased in both absolute terms and relative to U.S. consumption and production during the 2013-2015 period of investigation.

During the period, he said, Chinese imports captured 5.1 percentage points of market share from the domestic industry.

Mr. Johanson also found that imports from other countries, though gaining in U.S. market share, gained less than Chinese imports.

“In 31 of 37 quarterly comparisons between the prices of imports from China and Canada, the prices of imports from Canada were higher than those from China,” he wrote. “The prices of imports from Canada were even higher than U.S.-produced tires in nearly half of the quarterly comparisons.”

Considering data on capital investments in the domestic industry, Mr. Johanson said he found it unlikely that the domestic industry would perform as well in the near term as it did during the period of investigation.

“Nevertheless, given the domestic industry’s performance throughout the period, I do not find that the domestic industry is currently in a vulnerable state,” he said.

In the final determination, Mr. Johanson voted with Commissioners Meredith M. Broadbent and F. Scott Kieff, who repeated their negative findings on material injury.

“The domestic industry was able to increase output, employment and profitability levels during the period of investigation,” said the majority opinion in the final ITC report.

“While the domestic industry lost market share during a time of rising demand, we have found that the decline of market share was due to capacity limitations and very high capacity utilization, rather than to the subject imports,” the document said.

“We further found that the increased volume of low-priced subject imports had no significant price effects and coincided with significant improvement in the domestic industry’s condition,” it said.

In their dissenting views, Ms. Schmidtlein and Mr. Williamson wrote, “We find that a significant volume of subject imports from China has undersold the domestic like product, significantly depressed U.S. prices and caused material injury to the domestic industry.”

Ms. Schmidtlein and Mr. Williamson discounted evidence that the domestic industry’s performance improved during the period of investigation.

“The U.S. industry was profitable, and profits grew over the period, but the overall increase was modest considering the significant increase in demand over the investigation period and the opportunity to benefit from lower costs,” they wrote.

The United Steelworkers union petitioned the ITC for antidumping and countervailing duty relief against Chinese truck and bus tire imports in January 2016. Commissioner Dean A. Pinkert did not participate in the investigation. Shortly after the final vote was taken, Mr. Pinkert announced his return to private law practice.

 

According to the ITC, there are seven truck and bus tire plants in the U.S., employing 6,629.

The apparent dollar value of truck and bus tire consumption in 2015 was $6.1 billion, the ITC said.

Chinese imports accounted for $1.2 billion of that total, with $1.3 billion coming from other countries including Canada, Japan and Thailand.

China continued last year as the No. 1 source of imported truck/bus tires, despite shipments falling 14.4 percent, to 7.63 million units. Overall imports were off as well, by 3.8 percent to 13.9 million units. 

Thailand’s truck/bus tire exports to the U.S. jumped 98.7 percent to 1.82 million units, making that nation the No. 2 source of imported truck tires last year.

Canada, Japan and South Korea were third through fifth on the list, with South Korea’s exports to the U.S. growing 85.1 percent to 421,239 units.

Read the source article at Tire Business

ITC decision leaves USW, retreaders reeling

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WASHINGTON (Feb. 24, 2017) — The United Steelworkers (USW) union and U.S. retreaders are reeling in the wake of the U.S. International Trade Commission’s (ITC) decision to not impose import duties on Chinese truck and bus tire imports.

The 3-2 ITC vote on Feb. 20 that the U.S. truck and bus tire industry has not suffered material injury because of Chinese imports means the U.S. Department of Commerce will not order U.S. Customs and Border Protection to collect antidumping and countervailing duties from Chinese truck and bus tire manufacturers and importers.

The USW union, which had petitioned the ITC for duties a year ago, expressed disappointment at the agency’s decision, as did represesentatives of the U.S. retreading industry, which supported elevated duties on Chinese truck/bus tires as a way to keep an important price differential between new Chinese tires and retreaded truck tires.

“Of all the stakeholders in this, retreaders are the ones who are hurt the most,” said Terry Westhafer, president of Verona, Va.-based retreading firm Central Tire Co.

Considering the fact that the Commerce Department had issued final antidumping and countervailing duties against Chinese tire makers in late January, Mr. Westhafer said it is hard to understand how the ITC failed to find material injury in this investigation.

Read the source article at Tire Business

Goodyear Announces Pricing of $700 Million of Senior Notes

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The Goodyear Tire & Rubber Company (NASDAQ: GT) today announced that it has priced its offering of $700 million aggregate principal amount of 10-year senior notes. The notes will be senior unsecured obligations of the company.

The notes will be offered to the public at a price of 100% of their principal amount and will bear interest at a rate of 4.875% per annum. Goodyear expects the offering to close on March 7, 2017, subject to customary closing conditions.

Goodyear intends to use the net proceeds from this offering, together with cash and cash equivalents, to redeem in full its $700 million in aggregate principal amount of 7.0% senior notes due 2022.

Read the source article at cnbc.com

Certain Amorphous Silica Fabric from China Injures U.S. Industry, Says USITC

The United States International Trade Commission (USITC) today determined that a U.S. industry is materially injured or threatened with material injury by reason of imports of certain amorphous silica fabric from China that the U.S. Department of Commerce (Commerce) has determined are subsidized and sold in the United States at less than fair value.

Chairman Rhonda K. Schmidtlein, Vice Chairman David S. Johanson, and Commissioners Irving A. Williamson, Meredith M. Broadbent, and F. Scott Kieff voted in the affirmative.  Commissioner Dean A. Pinkert did not vote in these investigations.

As a result of the USITC’s affirmative determinations, Commerce will issue antidumping and countervailing duty orders on imports of this product from China.

Read the source article at USITC

February 27, 2017 Weekly Legislative Update

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At the OTR Conference, during our discussion on tax reform, we went into the “border adjustability” provisions set forth in the House Blueprint Tax Reform package.  As you probably know, these provisions are quite controversial.  Under this proposal, exports would not be subject to corporate tax while imports would be subject to tax.  It is intended to promote US manufacturing.

This provision has pitted companies that primarily export (for instance, Boeing and Caterpillar), which are obviously in favor of it, against companies that import (for instance, Walmart, Target, Best Buy, most retailers, your local gas station), that believe not only would the provision be detrimental to them but also to the consumer.  Companies that oppose the proposal are stressing that costs of producing their goods will go up by 20% and that they would have to pass the cost on to the consumer. 

Read the source article at TIRE INDUSTRY ASSOCIATION