Industry organisation the South African Tyre Manufacturers Conference (SATMC), which includes Continental, Bridgestone, Goodyear and Sumitomo, has welcomed the International Trade Administration Commission’s (Itac’s) publication of provisional payments of 38.33% on unfairly traded, or dumped, passenger, truck and bus tyres imported from China for six months until March 8, 2023.

The SATMC had applied to Itac for relief against dumped imports from China in late 2021. It said on September 9 that these provisional payments would address the issue of unfairly traded tyres from China that “over many years have caused the South African Customs Union tyre industry to suffer material injury that placed the tyre industry’s future, investment opportunities and direct and indirect job creation at risk”.

"SATMC wishes to stress that the investigation that was initiated on January 31, is still ongoing. Only the preliminary phase of the investigation has been concluded and resulted in the provisional payments," the organisation said on September 9.

A preliminary report will soon be published, setting out Itac’s decision. Interested parties have 14 days from the date of publication of the preliminary report to comment in writing to Itac.

Further, the Itac investigation will continue, with its final investigation phase, during which Itac will study all interested parties’ comments and verify information that was submitted, before issuing an essential facts letter. This will be followed by Itac’s final determination that must be published by or before July 31, 2023.

Fairly traded imports at prevailing prices from countries other than China, such as Korea and Japan, will continue unaffected into the South African Customs Union.

The SATMC applied to Itac for the implementation of additional duties of between 8% and 69% on passenger, taxi, bus and truck vehicle tyres imported from China. Current import duties levied on tyres range from 25% to 30%.

Industry association the Tyre Importers Association of South Africa (TIASA) said it was disappointed by Itac’s announcement of the imposition of a blanket 38.33% provisional duty on tyres imported from China, which is on top of the import duties that currently exist of between 25% and 30%.

"TIASA believes these additional duties will have a devastating impact on motorists, public transport users and the trucking and logistics sector, and will drive up consumer inflation and the price of living, putting South Africans under further financial strain."

The 38.33% additional duty, as has now been applied by Itac, means that, from September 9, taxi operators, passenger vehicle owners and truck and logistics companies will pay about 20% more for tyres, TIASA averred.

“This decision by government is unfathomable. Duties are simply another form of tax on the consumer and on businesses, and it is clear that Itac and the Department of Trade, Industry and Competition (DTIC) have not properly considered the impact this will have on the cost of goods, transport and on inflation itself,” said TIASA chairperson Charl de Villiers.

Further, industry association the Road Freight Association (RFA) said the antidumping duty levied at 38.33% on the imported price of the tyres will increase the price of tyres and impact on the operational costs of transport.

It will drive up the price of the transportation of goods by at least 8% and, depending on the transport leg variables, this increase could be more, said RFA CEO Gavin Kelly.

"Tyres are a crucial link in the safe and efficient operation of a vehicle, and affect road safety through road holding ability, carrying weights, navigating through bad roads and ensure the driver has control in unexpected weather or traffic situations. They also affect the fuel consumption of a vehicle and the type of wear and tear that is experienced by the road surface.

"The country cannot have a situation where tyres become so expensive that fleet owners and private individuals begin to push tyres to the extreme limits of wear and endurance."

The RFA appealed to the DTIC to reconsider the decision and proposed that, once there is sufficient sustainable capacity in the country, the possible introduction of an antidumping levy is then considered to protect a local tyre manufacturing industry that produces enough tyres to meet local demands, he said.