The Department of Homeland Security raided the U.S. subsidiary of a Chinese auto parts manufacturer outside of Dayton, Ohio on January 18, 2023. The agency won’t comment about the nature of the search warrant executed against Harco Manufacturing other than that it was part of a federal investigation, the Dayton Daily News reports. Harco was acquired in 2015 by Qingdao Sunsong, a brake hose maker.
While there isn’t a direct connection to the search, Qingdao Sunsong has been accused of trade fraud by members of Congress. Two Republican representatives on the House Select Committee on the Chinese Communist Party wrote an open letter pushing Homeland Security to take action against Qingdao Sunsong. The letter claims:
“Reviews of Qingdao Sunsong’s public disclosures lay out a case of blatant trade fraud that is having a catastrophic impact on American manufacturers. Indeed, one American company has been compelled to accumulate significant debt, divest itself of two business divisions and most recently lay off one-quarter of its workforce due to Sunsong’s trade fraud. If swift action is not taken, the affected company will be forced to permanently cease its operations.”
The legislators claim that Qingdao Sunson has been shipping products to the United States via Thailand without any fundamental changes intended to add value to said products, circumventing the tariffs between the United States and China.
The tensions between the United States and China over the past decade have partly played out in a trade war. The Trump Administration imposed and the Biden Administration maintained tariffs against China to protect American manufacturing jobs ostensibly. However, tariffs work both ways. Chinese tariffs levied against the U.S. reduce the market access that American companies have in a country of 1.4 billion people.