Auto Service World
News   October 16, 2006   by Auto Service World

Congress Shows Steely Resolve

The six largest automobile companies with manufacturing facilities in the United States today applauded the efforts of 10 U.S. Senators who recently called upon the International Trade Commission (ITC) to revoke anti-dumping and countervailing duty orders on “corrosion resistant” (coated) steel.
The duties on this steel product, used extensively in the manufacturing of automobiles as well as a variety of household appliances, have been in place since 1993 and were last renewed by the ITC in 2000. The ITC will hold a hearing on October 17 as part of a “sunset review” to determine whether or not the duties should be revoked. A final decision is expected in December.
The letter to the ITC, initiated by Senator Lamar Alexander (R-TN) and signed by Senators Kit Bond (R-MO), Sam Brownback (R-KS), Tom Carper (D-DE), Jim DeMint (R-NC), Dianne Feinstein (D-CA), William Frist, (R-TN) Mary Landrieu (D-LA), Pat Roberts (R-KS) and David Vitter (R-LA), states, “Canceling these outdated orders would recognize the fundamental restructuring of the steel industry as well as the importance of this product to the competitiveness of America’s manufacturing sector.”
The Senators’ letter emphasized that the steel industry no longer needs special protection.
“The corrosion resistant steel orders now before the Commission were imposed in 1993 and were renewed six years ago before the massive restructuring of the steel industry.
In fact, the assets of the fourteen U.S. companies that produced corrosion resistant steel in 2000 are now owned by only six companies, and the market is dominated by just three.
Those three steel companies control approximately 70 percent of U.S. flat rolled steel production and have earned impressive operating profits averaging 12 percent of revenue since the beginning of 2004,” the letter continues.
The letter concludes: “Since the steel industry is now prospering, restrictions should be lifted to restore the competition to the marketplace.
Failure to do so would threaten the sector of the U.S. economy that uses this same product as a raw material, namely the automotive industry.
That’s why we urge you to sunset the AD/CVD orders on corrosion resistant steel immediately.”
The six automobile companies — DaimlerChrysler, Ford, General Motors, Honda, Nissan and Toyota — are jointly calling on the ITC to terminate anti- dumping and countervailing duties on “corrosion resistant steel.”
The six automotive companies together purchase $200 billion annually in materials, parts and services for their U.S. operations.
Steel is a critical component of every vehicle and a significant portion of production costs.
All six companies buy the overwhelming amount of the steel used in their U. S. operations from U.S. steel mills, but must maintain the ability to obtain key materials for their vehicle assembly plants dependably and at globally competitive prices.
The ITC is required to conduct a “sunset review” on antidumping and countervailing duties every five years.
The duties will be lifted unless the ITC finds that the steel industry is likely to face material injury as a result.
The duties on corrosion resistant steel have been in place since 1993 on imports from six countries: Australia, Canada, France, Germany, Japan and Korea.

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