AKRON — Those curious about the effects of elevated import duties on a market need look no further than the U.S. replacement tire market over the past four years.
Since the U.S. government imposed duties in 2015 — ranging up to 100 percent in some cases — on passenger and light truck tires from China, imports of passenger tires to the U.S. from that nation have dropped more than 80 percent, to 8.5 million units last year from 50.4 million in 2014.
As a result, the share of the U.S. passenger tire aftermarket taken by tires from China collapsed, falling to 3.9 percent last year from 24.4 percent in 2014.
The industry collectively is now looking at the potential impact of antidumping and countervailing duties imposed in February on truck and bus tires from China. The duties, which range from 20.98 percent to 63.34 percent countervailing and 9 percent to 22.57 percent antidumping, took effect in mid-February.
The truck/bus tire duties are the result of a petition filed in April 2017 by the United Steelworkers (USW) union, which represents workers at unionized tire factories in the U.S.
The U.S. International Trade Commission (ITC) voted in February 2017 not to impose duties, which prompted a USW appeal with the Court of International Trade, which remanded the decision to the ITC, which decided two months ago in favor of duties after re-evaluating the case.
At this point, it is still too early to gauge the full impact of the ITC's ruling on the market and importers of truck/bus tires from China, although there have been a few moves lately that indicate the commercial tire segment may mimic changes that took place in the passenger tire market.
Other recent actions by the Trump administration on tariffs on Chinese goods are compounding problems facing importers and add a wild card into the task of forecasting market changes.
In fact, the imposition of a general 10-percent tariff in September 2018 on $200 billion worth of goods from China and the threat of hiking this to 25 percent at year-end resulted in a spike in imports of truck/bus tires last year from China to a record 9.2 million units.