Want To Buy A Cheap Tire ( Made In China ) - Think Twice

Velocity · June 29, 2007

Taken from AUTOBLOG

Shot at 2007-06-28

In recent years, products made in China have gained more renown for being cheap than for the quality control behind them. Up until now, inexpensive sneakers that fall apart after a few weeks or DVD players that work erratically have been more of an annoyance and an economic threat as opposed to a physical one. Recent headlines would suggest that might be changing, however. The contaminated pet food that killed dozens of cats not long ago and the video of a Chinese car collapsing in on itself during a European crash test bring the issue of potentially hazardous Chinese imports to a whole new level.

Foreign Tire Sales, Inc. of Union, NJ is suing China's Hangzhou Zhongce Rubber Co. over a series of catastrophic failures of tires they manufactured that resulted in a fatal car crash in Pennsylvania. Hangzhou has been manufacturing tires sold by FTS and other distributors that left out an extra layer of rubber between the steel belts, causing them to overheat and have tread separation similar to the Firestone tires that failed on Ford Explorers several years ago. The tires may need to be recalled and FTS doesn't have the financial resources to deal with something like that, so it's suing the Chinese company to cover the expenses since they built the tires in a way that differed from what was specified. The Wall Street Journal's report on the matter contains additional details, and is well worth a read.

WHY BUY CHINESE ? - BUY KELANI TIRES

http://www.autoblog.com/2007/06/25/as-if-p...es-now-failing/

Velocity · June 29, 2007

SRI LANKANS SCREW UP THINGS IN STYLE

Sri Lankan car parts face ban in Pakistan over Indian taint: report

June 29, 2007 (LBO) – Auto part exports from Sri Lanka to Pakistan would be blocked because Indian-owned firms in the island are starting to "sneak" products to the country under a "faulty" free trade agreement, reports said.

Pakistan's The News said India has managed to ship automotive part through a faulty free trade agreement which it claimed was a "shocking development."

Pakistani officials were quoted as saying that tariff concessions would only be given to Sri Lankan exports of Betel leaves, if tyres, tubes and other spares made by Indian firms were blocked or placed in a negative list where existing concessions were removed.

Indian Problem

The APP news service quoted an advisor to the Pakistan finance ministry, Ashfaque Hasan Khan as saying that tariff on Betel leaves would be dropped from 35 to 20 percent only if Sri Lanka bans auto spare exports.

The report said a Pakistani government decision has been taken to "to safeguard national interest" and to protect the domestic auto industry.

"We would give duty concession to Sri Lanka on import of betel leaves and enhance the import quantity to 1,200 metric tonnes only if Sri Lanka did not export any auto parts to Pakistan," Ashfaque told APP.

"All the auto-parts exports from Sri Lanka to Pakistan will be included in the negative list."

Exports of Sri Lankan made tyres and tubes were still small at 169,000 US dollars.

India's CEAT runs the island's largest pneumatic tyre plants through two joint ventures. Sri Lanka has been attracting investment into the country touting its access to Indian and Pakistan.

Sweet Deals

Pakistan's Economic Coordination Committee chaired by Prime Minister Shaukat Aziz, Pakistan had been advised that tariffs on herbal cosmetics, biscuits, confectionery and ceramic tiles made in Sri Lanka would be removed once the issue of auto parts is addressed, The News also reported.

Fully domestic owned Sri Lankan firms such as the Hemas group has been test marketing personal care products to Pakistan.

The firm is also trying to strike a deal with a confectionary maker to market their products, but no progress has been reported after an initial announcement of the start of negotiations.

Due to heavy protectionism, as well as regional rivalries intra-regional trade in South Asia has been restricted and the region has high levels of poverty.

Attempts to liberalize trade under the aegis of the regional grouping, South Asian Association of Regional Corporation (SAARC) also largely failed over Pakistan and Indian rivalries.

Opening Up

However Sri Lanka has been pursuing bi-lateral trade deals after multi-lateral arrangements were slow to produce results.

The deals had negative lists to exempt existing visible trade (such as Betel leaves) in order to pacify protectionist trade lobbies, but trade experts were confident that opportunities to entirely new items previously not traded would come up as soon as private entrepreneurial ingenuity was allowed to work unfettered.

However analysts say the latest spat over rubber products and earlier problems Sri Lanka had with hydrogenated vegetable oils and copper with India shows that protectionism is very much alive and kicking in the region which is lagging behind the rest of the world.

Following a balance of payments crisis in 1991, India also switched to more liberal economic policies which has lifted hundreds of millions of people out of poverty and is making the country a global powerhouse.

But India has also been engaged in several trade disputes with Sri Lanka, after being egged on by local lobbies to help domestic industry which is heavily tariff protected.

Sri Lanka has been systematically dismantling trade barriers since 1977 and another round of liberalization was followed after 1995, despite some local criticism, giving rise to a growing export sector.

But weak macro-economic management which pushes up domestic inflation and made interest rates volatile has frequently undermined local industries.

http://www.lankabusinessonline.com/fullsto...;SEARCH_TERM=17