OEM Report: Automotive
Wednesday | 28 May, 2014 | 2:08 pm

WTO ruling against China welcomed by steel union, metal trade group

By Corinna Petry

May 28, 2014 - The U.S. metals and manufacturing community welcomed a decision by the World Trade Organization that supported claims by the United States that China illegally imposed antidumping and countervailing measures upon U.S.-made passenger vehicles.

The United States initially filed its complaint with the world body in July 2012. 

After studying the American claims and counterclaims by China, a WTO panel found China’s ministry of commerce erred in its determination of AD and CV duty rates for exporters, so those rates did not conform to WTO member nation requirements. The ministry failed to obey other related rules and protocols as well, for example, it did not conduct investigations consistently with the provisions of its global trade agreements. 

The WTO panel requested that China “bring its measures into conformity with its obligations” under WTO antidumping agreements.

“It is time for China to start playing by the rules,” United Steelworkers International President Leo W. Gerard stated.

“Since joining the WTO in 2001, it has repeatedly violated the rules by adopting practices to protect its market from imports while systematically subsidizing its exports and dumping them into foreign markets. This is the third recent win for the United States against China’s illegally imposed tariffs on U.S. products,” Gerard noted.

“The auto sector and the supply chain that supports it is one of America’s most important job engines. Some 350,000 USW members make products for vehicles, including steel, aluminum and plastics as well as glass, tires and other materials and parts. China’s protectionist practices have robbed America of export opportunities and jobs.”

The Alliance for American Manufacturing, which represents the metals industry and labor, commended the Obama administration “for pressing this case at the WTO” and urge them to “move forward on other vital trade actions, including practices that target the U.S. auto and auto parts sectors,” AAM president Scott Paul stated.

Three separate reports released in 2012 found that China's use of illegal government subsidies and “a web of predatory trade practices have undercut companies in the U.S. auto supply chain,” and found more than 400,000 jobs in the U.S. auto supply chain have been lost since 2000, while another 1.6 million U.S. jobs are at risk unless China's illegal trading practices are curtailed, according to the alliance.

Carl Levin, D-Michigan, who co-chairs the Senate Auto Caucus, said the WTO ruling confirmed that China’s anti-dumping and countervailing duty cases against U.S. vehicle exports were without merit. 

“It is laughable for China, the biggest dumping perpetrator in the world, to claim that U.S. vehicle exports are being sold in China below the cost of production when they are obviously not.

“Hopefully now there will be a renewed effort to open China’s markets to our products and the WTO will move quickly to rule on the pending cases against China’s trade barriers.”

A wider export market for American-made cars and trucks should benefit metals producers.

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2016 End User Outlook

Although low pricing on metal products across the globe once inspired companies to stock up, there’s little appetite for risk peering into 2016.


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