Congressmen & AAM Urge Action Against China's Auto Part Exports to U.S.
In late January 2012, Senator Brown (D-OH) announced that three reports had been issued by the Economic Policy Institute and a law firm1 indicating that China is subsidizing its auto part exports to the U.S. in a predatory manner, in violation of its World Trade Organization commitments. Brown argued that aggressive trade enforcement action is needed, citing President Obama's recent announcement of a new Trade Enforcement Unit (now called Trade Enforcement Center) to investigate unfair trade practices in countries such as China.
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The press release lists the three reports as follows:
- “Growing Threats to the U.S. Auto-Parts Industry from Heavily Subsidized Chinese Tires and Parts” -- this report indicates that every one of the U.S. auto-parts jobs is individually at-risk from unfair trade competition from China.
- “Putting the Pedal to the Metal: Subsidies to China’s Auto-Parts Industry from 2001 to 2011” -- this report notes that Chinese government is subsidizing its auto-parts industry and China’s central government’s commitment to disbursing additional subsidies for industrial restructuring and technological development of the industry.
- “China’s Support Program for Automobiles and Auto Parts Under the 12th Five Year” -- this report offers evidence that the massive government subsidies being given to Chinese producers, which are in violation of China’s WTO commitments, will continue for years to come unless challenged by Congress and the President.
House Trade Working Group Chair also Urges Administration to Act Against China
Representative Michaud, Chairman of the House Trade Working Group, in discussing the three reports, urged the Administration to use all of its resources to bring a trade enforcement case against China for illegally subsidizing its auto parts industry.
U.S. Manufacturers and USW Want Action on Auto Parts, Currency
According to a press release from the Alliance for American Manufacturing (AAM)2, the three reports show that “China's blatant use of illegal government subsidies and a web of predatory trade practices on a massive scale are undercutting companies in the U.S. auto supply chain." AAM urges the Administration to take action to challenge such abuses. AAM also notes that China also “employs currency manipulation to artificially lower the cost of its exports... which has the potential to cripple the U.S. auto-parts industry.
1Wiki states that EPI is a liberal, non-partisan think tank. The third report was issued by the law firm Stewart & Stewart.
2AAM states that it is a non-profit, non-partisan partnership of leading manufacturers and the United Steelworkers Union.