Lawmakers probe if US retailers bought Chinese auto parts that evaded tariffs (updated)

OReilly Automotive

06/09/2024 20:52

(Adds no immediate comments from companies, more details, more
comments from letters in paragraphs 4-8)
    By David Shepardson
       WASHINGTON, Sept 6 (Reuters) - A bipartisan group of
lawmakers asked the CEOs of six major  auto parts retailers if
they bought products from a Chinese company that may have evaded
U.S. tariffs, according to letters seen by Reuters on Friday.
    Representative John Moolenaar, a Republican who chairs a
House panel on China, and the committee's top Democrat Raja
Krishnamoorthi, along with other lawmakers, asked AutoZone
 AZO.N , O’Reilly Auto Parts  ORLY.O , Genuine Parts  GPC.N ,
Advance Auto Parts  AAP.N , First Brands Group, and Factory
Motor Parts to address concerns they are purchasing parts from
China's Qingdao Sunsong and its U.S.-based subsidiary.
    The lawmakers - which also included Senators Sherrod Brown,
a Democrat and Republican Bill Cassidy - raised concerns Qingdao
may be illegally transshipping Chinese products through Thailand
into the United States to evade U.S. customs duties. 
    The companies did not immediately respond to requests for
comment or could not be reached.
        "U.S. retailers are responsible for ensuring their
procurement practices do not inadvertently support companies
engaged in tariff evasion or other unlawful trade practices,"
said the letters, which asked a list of questions about
purchases and company efforts to ensure compliance with U.S.
trade laws.
  
        The letters, signed also by Representatives Darin
LaHood, Glenn Ivey and Ashley Hinson, cited a report that U.S.
officials raided Qingdao Sunsong’s U.S. subsidiary in January
and public company disclosures reveal that U.S. auto part
retailers including AutoZone, Advance Auto Parts, and O’Reilly
account for more than 40% of Qingdao Sunsong sales.
  
        In 2019, the United States adopted new 25% tariffs on
some Chinese auto parts, including rubber hose assembly products
that were produced by Qingdao Sunsong.
  
        The lawmakers said that company established a
transshipping facility for these goods in Thailand and cited a
company filing revealing that "the primary objective of its
investments in Thailand is to circumvent U.S. tariffs and allow
for the low-cost shipment of goods to U.S. auto part retailers."
  

 (Reporting by David Shepardson; Editing by Andrea Ricci)
 ((David.Shepardson@thomsonreuters.com; 2028988324;))