USTMA: Steel tariffs could pose a risk to U.S. tire makers

WASHINGTON — The U.S. Commerce Department's tentative plans to place tariffs on imported steel could "pose a risk" to U.S. tire manufacturers, the president and CEO of the U.S. Tire Manufacturers Association (USTMA) said in an opinion piece published July 17 on The Hill, a political website.

At issue are cord-quality steel wire rod, tire cord and bead wire used in tire manufacturing, according to Anne Forristall Luke.

"Virtually all steel used in U.S. tire manufacturing must be imported, as domestic steel suppliers cannot meet volume and quality needs for this critical tire safety component," Ms. Luke wrote in her op-ed article.

"Thus any trade constraint could potentially have a cascading, negative impact on U.S. commerce nationwide, as the transportation industry depends on a reliable supply of tires to ship goods."

Ms. Luke's opinion piece was an extension of the testimony Tracey L. Norberg, USTMA senior vice president and general counsel, delivered May 24 at a Commerce hearing on the national security implications of steel imports.

Ms. Norberg essentially made all the major points Ms. Luke did, saying that safety concerns make steel wire rod imports necessary.

"It is our understanding that electric arc furnace technology, used in domestic steel mills, is unable to produce consistently the quality of tire cord-quality wire rod necessary to make tire cord," she said.

In her opinion piece, Ms. Luke claimed that steel used in tire manufacturing comprises less than 1 percent of total U.S. steel production, so an exemption for steel of that kind would not have a negative impact on U.S. steel producers.

"However, while tires aren't a major factor in overall steel consumption, steel does play a vital role in the production of tires," she said.

Increased tariffs on tire-grade steel would threaten national security, because the U.S. military depends on a reliable supply of high-performing tires, she said.

According to Ms. Luke, the U.S. tire industry generates more than $148.4 billion in sales, operates 55 manufacturing facilities in 19 states and provides more than 737,000 jobs.

Officials of the United Steelworkers union, which supports the proposed tariffs, did not answer request for comments about Ms. Luke's opinion piece.