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Chinese Tires Subject of a Lawsuit

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From the Wall Street Journal, informative article

China-Made Tires Are Subject
Of Lawsuit After Fatal Accident
June 25, 2007 7:05 p.m.

A recent lawsuit arising from a fatal auto accident in Pennsylvania is pointing toward another potentially hazardous Chinese import, this time tires.

The accident occurred last August, when a steel-belted radial on a cargo van carrying four passengers allegedly experienced a tread separation -- the type of problem that prompted the big Firestone recall of 2000 -- causing the driver to lose control and crash. Two passengers were killed, the two others injured, one severely.

The tire's U.S. distributor -- Foreign Tire Sales Inc. of Union, N.J., says that it discovered a safety feature it had specifically asked the manufacturer to include was omitted from up to 450,000 of the tires imported from China's Hangzhou Zhongce Rubber Co. since 2002. FTS has notified federal safety officials that a recall may be necessary and that it believes other U.S. distributors have been selling identical tires, which could account for up to another half a million tires.

Unlike other potential recalls involving tire makers with a major presence in the U.S., this case involves a Chinese manufacturer selling through U.S. distributors and raises questions about the effectiveness of U.S. safety regulations as they relate to such imports.

FTS says it doesn't have the resources to pay for the recall itself and that it can't even clearly identify the specific tires because the Chinese manufacturer has failed to provide the distributor with the identification numbers of the tires that were manufactured with the missing safety feature.

"Sooner or later there'll be a recall on these tires -- the $64,000,000-question is who pays for it," says Lawrence Lavigne, an attorney representing FTS in a suit filed in district court in New Jersey against Hangzhou. In its suit, FTS accuses the tire maker of removing the safety feature -- a six millimeter layer of rubber that is put between the steel belts to give the tires added durability -- without notifying the distributor.

Mr. Lavigne says FTS suspected a problem as early as 2005, when it noticed a significant increase in claims from consumers for compensation. This typically arises when consumers are unsatisfied with the performance of a tire and return it for a refund or replacement. He contends the Chinese manufacturer initially insisted the tires were built to the specifications and only much later admitted the change.

There has been at least one other accident involving an ambulance, which didn't result in injuries, and a host of claims for compensation from consumers who had problems with the tires.

An official of Hangzhou Zhongce Rubber Co. reached late Monday evening in China said: "We are aware of this matter and we are now in the process of responding to the lawsuit. Production and sales at our company remain normal."

The problem comes in the wake of several other high-profile safety problems with Chinese products, including the discovery of lead paint on children's toys and hazardous material in Chinese-made toothpaste. In this case, FTS is the "importer of record" for the tires, which makes them responsible for making sure the tires meet U.S. requirements.

Adding a layer of complexity is the fact that the tires meet minimal U.S. safety requirements, according to FTS. The distributor notes that it often demands additional features to make tires more durable than the requirements.

"We saw during the Ford Explorer-Firestone tire scandal how deadly a defective tire can be, especially if it is paired with a light truck," says Sean Kane, president of Safety Research & Strategies, a consumer group that works closely with plaintiff attorneys on a variety of automotive issues
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This from the bbc:

Chinese tyre row escalates in US

The amount and quality of Chinese imports is a hot political issue
A Chinese tyre firm has defended its safety record after US regulators ordered a major recall of its goods and it was sued by one of its customers.
Hangzhou Zhongce Rubber said it had not found any deficiencies after US firm Foreign Tire Sales (FTS) was instructed to recall 450,000 of its truck tyres.

The New Jersey firm sued Zhongce last month, saying it had stopped buying van and truck tyres due to safety worries.

Chinese imports have been the subject of a series of recent safety scares.

Safety standards

A leading Senator has accused Chinese firms of failing to adhere to proper safety standards following high-profile problems with goods ranging from pet food to toothpaste.

FTS has said it cannot be sure how many tyres are potentially defective, although it has estimated the figure to be about 450,000.

It has warned that a full product recall could force it into bankruptcy, adding that it believes at least six other US firms have imported the model in question.

China has been asleep at the switch when it comes to safety inspections

US Senator Charles Schumer

Transport regulators have dismissed its request for financial assistance, arguing that the US importer must bear some of the responsibility for the state of the tyres it sells.

The New Jersey firm sparked the alert after it found a number of light truck tyres imported since 2002 lacked a basic safety feature.

Tests conducted over the past year, it said, found that the model in question may fail earlier than those previously provided.

"At some point in time, unbeknownst to FTS, Zhongce unilaterally changed the construction of the subject tyres," it said in a letter to the National Highway Traffic Safety Administration.

It is pursuing its Chinese supplier for damages and is seeking an injunction to block any further imports.

FTS is being sued by relatives of two men killed last year in a crash involving a vehicle said to have used Zhongce tires.

'No faults'

But the Chinese firm cast doubt on the validity of the recall, saying it had "not found the faults cited by FTS".

It added that none of its other US customers had expressed concerns about the reliability of its products.

The US imports more than 30 million tyres from Chinese producers, which are highly competitive due to their low labour costs.

The standard of Chinese imports to the US have come under the spotlight in recent months after chemical scares prompted a succession of product recalls.

"China has been asleep at the switch when it comes to safety inspections," said Charles Schumer, Democrat Senator for New York.

A political backlash against the spiralling US trade deficit with China has led to calls for tighter controls on imports.
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From the New York Time

Chinese Tires Are Ordered Recalled

Published: June 26, 2007
Federal officials have told a small New Jersey importer to recall 450,000 radial tires for pickup trucks, sport utility vehicles and vans after the company disclosed that its Chinese manufacturer had stopped including a safety feature that prevented the tires from separating.

Tread separation is the same defect that led to the recall of millions of Firestone tires in 2000. At the time, tire failure was linked to an increased risk of rollover of light trucks and S.U.V.’s.

The company, Foreign Tire Sales of Union, N.J., had originally sought the federal government’s help with a recall, saying it did not have enough money to recall all the tires itself. Typically, importers are responsible for the cost of recalling defective foreign products.

But officials at the National Highway Traffic Safety Administration said it remained the responsibility of Foreign Tire Sales to pay for the costs of the recall, said Heather Hopkins, a spokeswoman for the agency. She said the agency wanted “a full tire recall” by the company.

The defective tires join a growing list of problematic products with origins in China. A huge recall of potentially tainted pet food in March was followed by widespread reports of toothpaste manufactured with a toxic chemical and toys coated with lead paint.

Ms. Hopkins said the agency’s top officials were “outraged” that Foreign Tire Sales’ executives waited more than two years to pass on their suspicions about problems with the tires. The company first suspected problems in October 2005. Almost a year later, in September 2006, the Chinese manufacturer, Hangzhou Zhongce Rubber, a former state-owned company based in eastern China, acknowledged that a gum strip that prevents the tread from separating was left out of the manufacturing process.

Lawrence N. Lavigne, a lawyer for Foreign Tire Sales, said the company did not alert the National Highway Traffic Safety Administration about the problems until June 11 because officials had no definitive proof of a manufacturing flaw until it was revealed by further testing in May. He said it made no sense to initiate a recall based on suspicions.

Jeffrey B. Killino, a personal-injury lawyer from Philadelphia, said the company came forward only after it was named as a defendant in a lawsuit, filed in May, involving an accident in which two construction workers were killed and a third was severely injured when a van rolled over. The lawsuit contended that the accident was caused by tread separation in a Hangzhou Zhongce tire.

Earlier, an ambulance in New Mexico rolled over after a Hangzhou Zhongce tire came apart, though there were no significant injuries, according to documents supplied by Foreign Tire Sales to the federal safety agency.

An official at Hangzhou Zhongce Rubber, reached late Monday, declined to comment. The defective tires are sold under the brand names Westlake, Compass, Telluride and YKS, Mr. Lavigne said.

Tire separation led to a much larger recall in 2000. Firestone recalled 6.5 million tires after at least 271 people were killed and hundreds more injured in accidents involving its tires coming apart.

It is not clear how many defective tires might be on the road.

Hangzhou Zhongce has refused to tell Foreign Tire Sales’ officials how long it omitted the gum strip from its manufacturing process, Mr. Lavigne said. Foreign Tire Sales said it believed that it purchased about 450,000 of the tires in question from the Chinese company.

Hangzhou Zhongce sold the tires to at least six other importers or distributors in the United States.

Foreign Tire Sales, which has just seven employees, buys foreign tires, imports them and then resells them to domestic distributors. Mr. Lavigne said the company did not physically handle the tires.

The company began negotiating with Hangzhou Zhongce in 2000 to design and manufacture radial tires for light trucks. The tires were supposed to exceed federal safety standards, partly by including a gum strip between the plies to prevent separation, and ultimately passed a road test in which they were driven 40,000 miles, Mr. Lavigne said.

In October 2005, the company said it became concerned because of a sharp increase in customer complaints about the Hangzhou Zhongce radial tires. In investigating the complaints, Foreign Tire Sales’ officials became suspicious that Hangzhou Zhongce was manufacturing the tires without the gum strips or with inadequate gum strips, but the Chinese company denied it.

Tests of tire segments conducted by an outside firm were not conclusive but “seemed to indicate that there were no gum strips or insufficient gum strips in the inspected tires,” Foreign Tire Sales wrote in its June 11 report to the National Highway Traffic Safety Administration.

Hangzhou Zhongce admitted in September 2006 that it had “unilaterally decided to omit the gum strips” in the tires, the report says. The Chinese company was “generally unresponsive” when asked how many tires were involved and what they were going to do to resolve the problem, the report says.

Foreign Tire Sales stopped buying the light-truck tires from Hangzhou Zhongce in June 2006.

In May, Foreign Tire Sales conducted another round of road tests using 2005 Hangzhou Zhongce tires. This time, the tread separated after just 25,000 miles, the report said.

Mr. Lavigne said it appeared that Hangzhou Zhongce at times used no gum strips on the tires and in other instances, used half the amount of gum strip that was required by its agreement with the company.

Since Foreign Tire Sales maintains no inventory of tires, he said the company would have to buy new tires for every tire that was returned in the recall. That, added to the cost of disposing of the old tires, he said, would cost about $200 for each tire.

“We don’t really know where to start,” he said. “There’s no way F.T.S. can recall this universe of tires. It will have to go belly up.”
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