View or download a PDF version of the full report here.

Where the Rubber Meets the Road:
How a global tire titan got millions in pandemic small business loans

Congress provided basic support for small businesses during the Coronavirus pandemic, but the program was poorly designed and implemented, leaving many smaller and independent businesses without access to needed support during the economic crisis. Many larger firms — including those affiliated with large corporations — obtained generous support while genuinely small and independent businesses had difficulty accessing the program under the Trump administration. Small businesses owned by people of color and women, who had longstanding challenges accessing credit before the pandemic, faced particularly acute difficulties.

One South Carolina tire factory exemplified a number of the structural and implementation failures of the Paycheck Protection Program (PPP), which was administered by the Small Business Administration (SBA), that favored larger companies even if these firms did not make sure their workers kept receiving a paycheck. The PPP was supposed to provide credit to small and independent firms that lacked access to needed financial support during the economic crisis. But the Giti Tire USA (Giti) factory received a nearly $8 million SBA loan even though it is a subsidiary of a global tire company with revenues of over $3 billion and 33,000 workers — far in excess of the total domestic or global employee limit for the program. Another Giti subsidiary in California received nearly $2 million in PPP support.

The PPP was intended to provide funding for businesses to keep workers employed and pay other critical business expenses. But, even though Giti received generous support, the factory furloughed over 600 workers without pay for a month, brought back only about half the workers when it first reopened, and ultimately laid off many of them permanently.

This Giti Tire case study highlights the failures of the Trump administration’s implementation and oversight of the PPP. The SBA’s uneven implementation, weak monitoring, and lax enforcement of the small business lending program has left many businesses languishing without support and allowed inappropriately large firms and those affiliated with big businesses to access the funds without keeping workers employed during the pandemic once they could safely return to their jobs.