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U.S. President Barack Obama. (JOSHUA ROBERTS/REUTERS)
U.S. President Barack Obama. (JOSHUA ROBERTS/REUTERS)

U.S. to file WTO complaint against China on auto duties Add to ...

The United States will file a complaint against China on Thursday with the World Trade Organization for imposing duties on more than $3-billion worth of U.S.-made autos, a senior U.S. official said.

The complaint comes as President Barack Obama campaigns in Ohio, an important election battleground state where auto plants have been affected by the duties.

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The president’s re-election campaign has sought to tie his Republican opponent, Mitt Romney, to the outsourcing of American jobs to China, tapping into public worry over high U.S. unemployment that will be a key factor in the Nov. 6 ballot.

Mr. Obama will discuss the trade action during his visit to Ohio, where he begins a two-day campaign bus tour that will end in Pennsylvania, where the threat to manufacturing jobs posed by competition from China also looms large among voter concerns.

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

The administration has sought to portray itself as tough on China, while taking care not to push too hard against a rival whose co-operation it needs on a number of important fronts, including against Iran over its nuclear program.

The trade duties cover more than 80 per cent of U.S. auto exports to China, including cars manufactured in Toledo and Marysville, Ohio, and Detroit and Lansing, Mich.

“The duties disproportionately fall on General Motors and Chrysler products precisely because of the actions that President Obama took to support the U.S. auto industry during the financial crisis,” the official said.

The WTO complaint is meant to reinforce that message and counteract criticism from Mr. Romney that Mr. Obama has not been strict enough when dealing with China.

The president’s campaign has also hit Mr. Romney hard over reports that Bain Capital, the private equity firm he led, invested in companies that were early adopters of outsourcing business activities to cheap labour markets like China.

Beijing slapped anti-dumping and countervailing duties on U.S. auto exports in December, 2011, on roughly 92,000 autos and SUVs, worth $3.3-billion in annual U.S. exports.

The combined duties amounted to 15 per cent on Chrysler’s Jeep Wrangler produced in Toledo, Ohio and the Jeep Grand Cherokee produced in Detroit, Michigan.

They were even an steeper 21.8 per cent on GM’s Buick Enclave and Cadillac CTS, produced in Lansing, Michigan. Foreign car makers who build autos in the United States were also hit, including Honda’s Acura TL, produced in Marysville, Ohio, which was hit with a 4.1 per cent duty.

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