Jan 21, 2024 - World

DHS raids Chinese car parts maker's U.S. headquarters

Seal of U.S. Department of Homeland Security

Photo: Saul Loeb/AFP via Getty Images

The Department of Homeland Security executed a search warrant last week at the Ohio-based U.S. subsidiary of Qingdao Sunsong, a Chinese automobile parts manufacturer that a congressional committee has accused of trade fraud.

The big picture: There is growing concern among lawmakers that Chinese companies are evading U.S. tariffs.

What's happening: DHS agents searched the premises of Harco Manufacturing Group in Moraine, Ohio on Thursday, Dayton Daily News and other local news reported.

  • Sunsong Holdings acquired Harco Manufacturing Group in 2015.
  • The search was held at 3535 Kettering Boulevard, the address of Harco's plant, and the same address that Sunsong North America lists on its website.

What they're saying: "Homeland Security Investigations executed a federal search warrant in the Moraine, Ohio area Jan. 18. This is an ongoing investigation, no further information is available at this time," a DHS spokesperson told Axios.

  • Sunsong North America and Harco did not immediately respond to requests for comment.

Details: In September, members of the House Select Committee on the Chinese Communist Party wrote a letter to DHS secretary Alejandro Mayorkas that accused Qingdao Sunsong of moving some of its production to Thailand in order to evade U.S. tariffs.

  • The letter cited Qingdao Sunsong's public filings, which state the company's products are subject to U.S. import tariffs of 25% imposed on certain goods made in China and that "in order to reduce tariff costs, the issuer has accelerated production in Thailand."
  • In the letter, Rep. Mike Gallagher (R-WI) and Rep. Darin LaHood (R-IL) call Sunsong's activities a "case of blatant trade fraud that is having a catastrophic impact on American manufacturers."
  • "The use of transshipment to evade United States tariffs is a serious violation of U.S. law and undermines American economic and national security," the lawmakers wrote.

The other side: "Some in the U.S. are attempting to politicize and weaponize trade issues between China and the U.S. We firmly oppose this," a spokesperson for the Chinese embassy in Washington, DC told Axios via email.

  • "China-U.S. economic and trade cooperation benefits both sides. Curbs and protectionism will only disrupt normal trade and destabilize industrial and supply chains. They do not serve the interests of any party," they added.

Background: The Biden administration has kept many of the tariffs that the Trump administration imposed on China beginning in 2018.

  • China has failed to meet its commitment under a 2020 trade deal with the U.S. to increase its purchases of U.S. goods and services.

Editor's note: This story has been updated with comment from DHS and the Chinese embassy in Washington, DC.

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