Nov 19, 2009 8:02 pm US/Central
Tire Prices On The Rise After Tariff On China
DENVER (CBS) ―
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The days of cheap tire prices may be gone for good. Tire prices are on the rise, in large part due to an effort by President Obama to save American jobs, CBS station KCNC-TV reports.
CBS
The days of cheap tire prices may be gone for good. Tire prices are on the rise, in large part due to an effort by President Obama to save American jobs, CBS station KCNC-TV reports.
Some American tire makers have had to shut down because of low cost tires flooding in from China. President Obama did what President Bush declined to do. He made Chinese tires more expensive by imposing a tariff.
American drivers hardly noticed, but in the past decade they were buying up cheap Chinese tires in record numbers.
"The Chinese tires were so inexpensive compared to the American made product they kind of overtook everything," said tire wholesaler George Osborne.
Chinese tire imports went from less than five percent to nearly 17 percent of the American market. Four American tire plants closed in the past decade.
Worried about losing even more American jobs, President Obama imposed a 35 percent tariff on Chinese tires last September.
The tariff is meant to preserve jobs in the U.S. by making American made tires more competitive, but the jury is still out according to Osborne.
"They're trying to tighten the gap between the American product and the Chinese product and at first it was working and now we're seeing a lot of the domestic brands going up in price also," he said.
Goodyear is the latest example. It's raising prices by 6 percent to cover the increased cost of raw materials.
George Osborne tells his customers American made tires are better quality than the Chinese imports and he says it's still possible to find affordable, American made tires.
(© MMX, CBS Broadcasting Inc. All Rights Reserved.)
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