U.S. Affirms Steep Tariffs on China Solar Panels

Employees assemble photovoltaic panels at Suntech Power Holdings Co.’s factory in Wuxi, Jiangsu Province, China, in 2011.

WASHINGTON (AP) — The Obama administration upheld steep tariffs on Chinese solar panelsWednesday, finding that improper trade practices have undermined an American solar industry that the largest U.S. manufacturer says is in the midst of collapse.

In one of the largest trade cases the U.S. has pursued against the Asian superpower, the Commerce Department said China’s government is subsidizing companies that are flooding the U.S. market with low-cost products — a tactic known as “dumping.” To counteract those price cuts, the U.S. government imposed tariffs ranging from 18 percent to nearly 250 percent.

For some Chinese companies, those tariffs are lower than preliminary tariffs imposed in May.

Still, another set of duties dealing with improper subsidies was increased dramatically. While the initial ruling levied anti-subsidy fees ranging from 2.9 percent to 4.7 percent, the final ruling issued Wednesday sets those fees at 14.8 percent to 16 percent.

Read more of this post

Obama to hit China with trade case over cars, parts

President Barack Obama launches a campaign swing through the pivotal battleground of Ohio on Monday — armed with a new trade enforcement case against China over allegedly improper subsidies to its auto and auto-parts sectors.

Mitt Romney has recently escalated his attacks on the incumbent as not doing enough to protect America’s battered manufacturing sector from unfair competition from Beijing. The message has special resonance in states like Ohio, where the auto-parts sector accounts for a sizeable chunk of the economy. (The White House says the industry directly employs 54,200 Ohioans and supports some 850,000 total jobs).

Obama decided to go after China at the World Trade Organization (WTO) because its subsidies are giving its auto parts a leg up — even in the U.S. market — over their American counterparts, the administration says.

 

The Obama Administration is also escalating another trade enforcement action, begun in July, against what it says are unfair anti-dumping and countervailing duties on some $3.3 billion in U.S. automobile exports to China.

The United States will ask the WTO to set up a dispute settlement panel to consider its case against those duties, which Beijing imposed in December 2011. China acted in response to the auto bailout Obama championed, arguing the rescue amounted to unfair government support for the industry.

“The key principle at stake is that China must play by the rules of the global trading system,” an administration official said on condition of anonymity. “When it does not, the Obama Administration will take action to ensure that American businesses and workers are competing on a level playing field.”

 

The Cleveland Plain-Dealer first reported the news.

China moves in on U.S. manufacturer of high-tech car batteries

A123 Systems, a maker of advanced batteries for electric vehicles, has been struggling financially of late.  However, it may soon be rescued.  Unfortunately, the bailout could come from a Chinese auto-parts company.

Wanxiang Group Corp., one of China’s biggest auto parts makers, has offered a $450 million bid for A123 Systems Inc.

If a Chinese firm were to buy A123, it would put the firm’s lithium-ion technology and its U.S.-funded manufacturing plant, in the hands of a company that has been slowly acquiring U.S. auto parts firms throughout the Midwest.

According to Michael Wessel of the U.S.-China Economic and Security Review Commission (USCC), the deal has worrying implications.  As Wessel explained to Reuters:

“This is a very troubling transaction that should be strictly scrutinized by the U.S. government.  This is a critical sector and one that American policy makers have focused on in terms of future economic opportunity and job creation.”

China’s auto parts industry already enjoys massive subsidies that give Chinese firms a leg up on their U.S. competition.  According to a study conducted for the Economic Policy Institute (EPI) by Usha C.V. Haley, government subsidies to the Chinese auto-parts industry have reached $27.5 billion.  Haley says that China’s central government has committed to disbursing an additional $10.9 billion in subsidies for industrial restructuring and technological development of the industry.

U.S. firms like A123 face the double whammy of subsidized competition from China, and then the potential for buyout by the same competitors.

According to David Vieau, A123’s chief executive, the firm would seek approval from the Committee on Foreign Investment in the U.S. (CFIUS) in order to move forward on the sale to Wanxiang.  However, the deal already faces concerns from Rep. Cliff Stearns (R-FL), who chairs the House Energy and Commerce Committee’s panel on oversight and investigations, and is worried about the deal’s transfer of intellectual property.

The Wall Street Journal quotes Stearns as saying: “We need to make sure the federal government isn’t an unwitting accomplice to the theft of our own national secrets by providing [foreign-controlled companies] with multimillion-dollar government grants and loans.”

 

A company that two years ago was one of the most promising U.S. innovators in the clean-fuel auto industry was rescued from collapse Wednesday. Its buyer: A Chinese auto-parts company.

Wanxiang Group Corp., one of China’s biggest parts makers, offered a $450 million lifeline to A123 Systems Inc., a maker of advanced batteries for electric vehicles that received U.S.-government backing. The deal would put the firm’s lithium-ion technology and its U.S.-funded manufacturing plant into the hands of a company that has slowly acquired a passel of auto assets across the Midwest.

Wanxiang’s investment, part of a move into clean energy …

 

Death By China

 

Best-selling author and filmmaker Peter Navarro brings us DEATH BY CHINA, a documentary feature confronting America’s most urgent problem — its increasingly destructive trade relationship with China. 

Since the communist nation began flooding U.S. markets with illegally subsidized products in 2001, over 50,000 American factories have disappeared, putting than 25 million Americans out of work. The United States, as a result, now owes more than 3 trillion dollars to the world’s largest totalitarian nation.

Through compelling interviews with voices across the political spectrum, DEATH BY CHINA exposes our nation’s broken relationship with China and why it must be fixed for the world to be a place of peace and prosperity.

More Trade Actions – Wind Turbine Towers, Washing Machines

More Trade Actions – Wind Turbine Towers, Washing Machines

Dave Johnson  |  July 31, 2012  |  Campaign for America’s Future

The game is to underprice your product until your competitors go out of business (like Solyndra & other solar companies). Then you own the market. This is about a lot more than just jobs. Our government is finally doing something about leveling the playing field!

This week, in separate actions, our Commerce Department imposed “anti-dumping” tariffs on wind turbine towers and washing machines. The wind turbine towers were coming in from China and Vietnam, the washing machines from Mexico and South Korea.

Why Sell Under Cost?

Dumping is when a product is sold for less than it costs to evenmake the product. The idea is that your competitors will go out of business and the manufacturing ecosystem of suppliers, knowledge and infrastructure moves to you, so you’ll come out ahead in the long run.

It takes enormous investment to open up a manufacturing operation because you need the proper facilities, the right local utilities, the tools and machines, the skilled workforce, the suppliers, the local infrastructure, the channels to markets, and all the rest of the ecosystem that supports manufacturing. When that is lost to another country it is very, very difficult to get it back. Especially in a country with a Congress that refuses to understand the need for a national industrial policy.

This is the game that countries like China have been playing with their national industrial policies designed to capture strategic industries like solar and wind energy. By selling lower than cost for several years you gain market share and shed competitors. The suppliers, knowledge base, and jobs move their way. Eventually they build or strengthen an entire ecosystem and it is just too costly for others to try to compete.

At first it is attractive to take advantage of the lower prices, later the jobs, factories, companies and entire industries are gone along with the jobs and economic power they bring. Or, in other words, look around at what has happened to us.

Read more of this post

CHINA: DON’T LET US AUTO CASE IN WTO HURT TIES

BEIJING (AP) — China’s government said Friday it will “properly handle” a U.S. complaint to the World Trade Organization about its anti-dumping duties on auto imports and doesn’t want the latest in a string of trade disputes to harm relations.

“It is normal for frictions to occur,” said a foreign ministry spokesman, Liu Weimin, at a regular briefing. “What is important is to properly handle it and not to let it impede friendly relations.”

The U.S. complaint Thursday adds to a series of disputes with Beijing over market access for goods ranging from poultry to steel. Political tensions over trade are mounting as governments try to boost exports at a time of slumping global demand.

Washington accused Beijing of improperly imposing anti-dumping duties on American-made autos worth $3 billion. The Chinese duties of 2 to 21.5 percent affect cars and SUVs with engine capacity of 2.5 liters or larger.

A Commerce Ministry statement said Beijing will “properly handle the request for consultations under the WTO dispute settlement procedures” — the first step in resolving a complaint.

Read more of this post

Tariff on Chinese solar panels raises fear of trade war

By 

The Obama administration, still smarting from controversial investments in solar power firms like the now bankrupt Solyndra, has sparked fears of a trade war between the U.S. and China, as the Commerce Department signals it will likely slap a 31 percent tariff on all solar panel imports from China.

While some, frustrated by the high U.S. unemployment, want punishment doled out to China, others say protectionism only hurts the consumers who are forced to pay more.

Such a tariff has been pushed by companies that manufacture solar panels in the U.S., including Solar World, which has a plant in Hillsboro, Ore.

“It’ll basically allow us to compete on technology,” Solar World president Gordon Brinser said, “just like everybody else in any other industry.”

Solar World and others have seen their market share plummet as sales of inexpensive Chinese panels have skyrocketed. The Commerce Department found Chinese companies are guilty of dumping panels on average 31 percent below fair market value.

It’s a charge China’s Suntech, the world’s largest solar company, rejects.

“The way the costs have come down so much and become so competitive is we’ve globalized,” Suntech’s chief commercial officer, Andrew Beebe, said. “We manufacture in China, we manufacture in Japan, we manufacture in the United States.”

While still a tiny piece of America’s energy portfolio, the solar industry has seen substantial growth as the price of panels has fallen. The Interstate Renewable Energy Council’s most recent annual report says solar-generating capacity in 2010 quadrupled in the utility sector and went up 60 percent in residential in just one year.

But many U.S. solar companies that don’t make panels fear the tariff will drive prices so high, consumers will stop buying. Jigar Shah, president of the Coalition for Affordable Solar Energy, said manufacturing panels account for a mere 3 percent of the 100,000 U.S. jobs tied to the solar industry.

“The U.S. now is becoming one of the fastest-growing markets in the world, and this just puts a headwind on that,” Shah said.

The Brattle Group did a study for the coalition that predicted a 50 percent tariff would cost the U.S. 14,000 solar industry jobs. Manufacturers would initially see a small increase in employment, but as sales slowed, engineering and installation jobs would suffer.

Read more of this post

U.S. Imposes Anti-Dumping Duties On Chinese Solar Imports

Employees assemble photovoltaic panels at Suntech Power Holdings Co.’s factory in Wuxi, Jiangsu Province, China, in 2011.

The U.S. Commerce Department imposed tariffs of 31 percent to 250 percent on Chinese solar-product imports, siding with companies including SolarWorld AG (SWV) in the U.S. that said the items were sold below the cost of production.

The fees, announced today in an e-mailed statement, add to duties as high as 4.73 percent imposed earlier for getting unfair subsidies from China’s government. SolarWorld had asked for levies of more than 100 percent. Aaron Chew, a New York- based analyst at Maxim Group LLC, said before the decision that tariffs higher than 10 percent would be considered a victory for the U.S. companies.

“Commerce today put importers and purchasers on notice about the consequences of importing illegally subsidized and dumped products from China,” Gordon Brinser, the SolarWorld unit’s president, said in a statement.

The Commerce Department said a final determination on the tariffs would be made in early October. U.S. customs agents will collect a deposit or bond on solar cells made in China in the 90 days before today’s decision.

SolarWorld said its Hillsboro, Oregon-based U.S. unit can’t compete with Chinese exporters, including Suntech Power Holdings Co. (STP), the world’s largest solar-panel maker, and Trina Solar Ltd. (TSL) unless tariffs are imposed. Suntech was told to pay 31.22 percent, Trina’s levies were set at 31.14 percent and others were told to pay duties ranging from 31.18 percent to 249.96 percent.

Shares Rise

U.S.-based solar-product companies rose in New York trading after the announcement. First Solar Inc. (FSLR) climbed 94 cents, or 6.7 percent, to $14.92, and SunPower Corp. (SPWR)added 51 cents, or 10 percent, to $5.59.

Opponents of the punitive tariffs, such as the Washington- based Coalition for Affordable Solar Energy, which includes Westinghouse Solar Inc. (WEST) and more than 100 other companies, claim the levies would cost U.S. jobs.

Read more of this post

US govt sets new tariffs on China solar panels

The low cost of labor, coupled with the massive scale of production at its 14,000-person plant, have enabled China's Suntech to become the global industry leader in solar power in just a decade

MARCY GORDON | AP Business Writer – WASHINGTON

The Commerce Department is imposing new import fees on solar panels made in China, finding that the Chinese government is improperly giving subsidies to manufacturers of the panels there.

The Commerce Department said Tuesday it has found on a preliminary basis that Chinese solar panel makers have received government subsidies of 2.9 percent to 4.73 percent. Therefore, the department said, tariffs in the same proportions will be charged on Chinese panels imported into the U.S., depending on which company makes them.

The tariff amounts are considered small, but the decision could ratchet up trade tensions between the U.S. and China. Several U.S. solar panel makers had asked the government to impose steep tariffs on Chinese imports. They are struggling against stiff competition from China as well as weakening demand in Europe and other key markets, just as President Barack Obama is working to promote renewable energy.

“Today’s announcement affirms what U.S. manufacturers have long known: Chinese manufacturers have received unfair … subsidies,” Steve Ostrenga, CEO of Helios Solar Works in Milwaukee, said in a statement. The company is a member of a group called the Coalition for American Solar Manufacturing.

On the other side, some U.S. companies argue that low-priced Chinese imports have helped consumers and promote rapid growth of the industry.

The new tariffs are low, making the Commerce Department decision “a relatively positive outcome for the U.S. solar industry and its 100,000 employees,” said Jigar Shah, president of the Coalition for Affordable Solar Energy. “However, tariffs large or small will hurt American jobs and prolong our world’s reliance on fossil fuels. Fortunately, this decision will not significantly raise solar prices in the United States.”

Read more of this post

U.S. Congress Approves Tariffs to Combat China Subsidies

 

The U.S. Congress voted Tuesday to authorize renewed tariffs on billions of dollars worth of goods from China and other countries considered to be state-run economies, a move aimed at countering unfair subsidies.

The measure approved by lawmakers reaffirms the legality of a tariff program in place since 2007 on imports from “non-market economies,” which was struck down by a court ruling in December.

With support across party lines, the House of Representatives voted on Tuesday to give such authority back, following a similar vote a day earlier in the Senate. President Barack Obama plans to sign the bill.

Representative Dave Camp, a Republican who heads the powerful House Ways and Means Committee, said on the House floor that the measure would preserve an “important tool” for the United States.

Read more of this post

%d bloggers like this: