By Michael Ellis
DETROIT, Jan 27 (Reuters) - A group of automotive suppliers said on Monday that the Bush administration's protective tariffs on foreign steel have driven up their costs, forcing them to cut jobs and consider importing steel and other materials.
The companies, who are some of the largest purchasers of U.S. steel, said they may import more steel from countries that are exempt from the tariffs, such as Brazil, Argentina and Turkey. They may also import parts that use steel, they said.
"Wherever possible, we will purchase finished goods from non-U.S. suppliers whose steel costs are lower," said Jeff Stoner, vice president of worldwide procurement for ArvinMeritor Inc., which bought 1 million tons of steel globally last year.
Stoner said that ArvinMeritor, which makes wheels, drive trains and suspension systems for cars and trucks, said that rising steel costs were one reason it decided last week to close its Gordonsville, Tennessee, plant that makes window regulators and sunroofs.
Stoner and other automotive suppliers said at the event, organized by the Motor and Equipment Manufacturers Association, that the steel tariffs drove up their costs for steel by nearly 50 percent or more, and caused delivery delays.
President Bush imposed tariffs on foreign-produced steel ranging from 8 to 30 percent in March 2002 under so-called "safeguard provisions" of U.S. trade law.
Several companies said that for every one U.S. job the steel tariffs were designed to protect, more than 50 jobs were hit by negative consequences.
"Due to the competitive pressures of the automotive industry, our customers are not allowing us to pass on any of the increases to them," said Timothy Tindall, president of Spring Engineering and Manufacturing, a small family owned company.
"We are now forced to use higher domestic steel prices, while our offshore competitors can use lower global market prices. To offset some of these artificial price increases, we've imposed wage freezes, benefits freezes, had some layoffs and other cost-cutting measures," Tindall said. Other manufacturers echoed his comments.
The companies backed a bill by Michigan Rep. Joe Knollenberg, a Republican, who has co-sponsored a resolution proposing that President Bush consider the impact the steel tariffs have on manufacturers.
The U.S. International Trade Commission is required to review the effects of the tariffs by September 2003, but is not under any obligation to consider the impact on steel users, Knollenberg said.
"We want to bring pressure on the White House," he said. "This is not to embarrass him. We have to have the President's help. All we want is the President to have a complete picture."