A heavy metal decision for Detroit
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KAI RYSSDAL: In Washington today, the International Trade Commission voted to lift trade barriers on most imports of corrosive-resistant steel. That’s a type of steel coveted by car-makers, who’ve been lobbying for an end to the tariffs and duties (most recently at a White House meeting with President Bush a month ago). John Dimsdale reports trade regulators had to weigh jobs in the domestic steel industry versus the auto industry.
JOHN DIMSDALE: The U.S. was charging duties of as much as 40 percent on corrosive resistant imported steel. That’s one reason the price has almost doubled since 2000. Auto makers — domestic and foreign — claim the duties cost them $3 billion in profits.
Steel makers say the trade barriers held back a flood of cheap foreign steel and saved American jobs. Standard and Poor’s equity analyst Leo Larkin says that may have been true once, but no longer.
LEO LARKIN: The steel industry was far more fragmented, financially much weaker than it is now. It’s a difference almost between night and day.
U.S. steel makers warn the global playing field is still tilted against them. But analysts, including Larkin, say a cheap dollar and high transportation costs will keep foreign companies from flooding the U.S. market.
LARKIN: Steel makers in other countries are no longer at a huge cost advantage to the U.S.
And car companies say cheaper steel will allow them to keep their factories — and jobs — in this country.
In Washington, I’m John Dimsdale for Marketplace.
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