CLA-2-87:OT:RR:NC:N1:106
Andre LaMorgia, Chief Operating Officer
Cardinal Trade Associates
1430 Walnut Street, Suite 200
Philadelphia, PA 19102-4024
RE: The tariff classification of various automotive parts from China
Dear Mr. LaMorgia,
In your letter dated December 20, 2016, you requested a tariff classification ruling on behalf of Nohm, Inc. of Burlingame, California.
Five items have been presented in your request: Front Suspension Assembly, Rear Axle Assembly, Battery Pack, Passenger Vehicle Models, and Cargo Vehicle Models.
The front suspension assembly consists of a sub-frame (cradle), two upper control arms, two lower control arms, rack and pinion steering assembly, air conditioning condenser, two shock absorbers and springs, two wheel hubs, and two brake assemblies which include brake rotors, brake pads brake calipers, and brake fluid lines. A complete bill of materials was submitted with your request.
The rear axle assembly consists of dual, permanent magnet electric drive motors, two direct coupled reduction gearbox assemblies, two wheel hub assemblies with integrated planetary gear trains, an axle cradle, four suspension arms, and two disk brake assemblies, which include brake rotors, brake pads, brake calipers and brake fluid lines. As with the front suspension assembly, a complete bill of material was submitted with your letter.
The 76 kWh battery pack is used to power vehicles, and have a nominal voltage of 384 VDC. They utilize thermal control and consist of cells utilizing LiFePO 4 (lithium iron phosphate) chemistry. The battery pack is capable of DC fast charging, and vehicles to which it will be incorporated in include an on-board AC charger as well.
The passenger vehicle models have been identified as a B07 mini bus model and a G08 van model. The B07 mini bus is imported with seating to accommodate twenty-one passengers and one driver, and the G08 passenger van is imported with seating to accommodate nineteen passengers and one driver. You state that although both models will be imported with the subassemblies and battery packs not yet installed, all items will be arriving on the same vessel and most likely packed in the same container, and will be declared to CBP on the same entry.
The cargo vehicle models have been identified as a V06, V08 panel van models, and a P06 cab-chassis model. All three models have a gross vehicle weight rating of 16,535 pounds and the maximum payload of range from 6,394 pounds to 7,694 pounds. The cargo vehicle models feature leaf spring rear suspension, anti-lock brake systems (ABS), and driver and passenger seating in the vehicle cab. You state that the models will be imported separate from the subassemblies and battery packs, unlike the passenger vehicle models, and will be declared to CBP separately.
You suggested that the passenger vehicle models be classified in subheading 8702.90, which provides for “Motor vehicles for the transport of ten or more persons, including the driver: Other: Designed for the transport of 16 or more persons, including the driver.”
Merchandise is classifiable under the Harmonized Tariff Schedule of the United States (HTSUS) in accordance with the GRIs. GRI 1 states in part that for legal purposes, classification shall be determined according to the terms of the headings and any relative section or chapter notes. General Note 3. (h) (vi) to the HTSUS states “ ... a reference to “headings” encompasses subheadings indented thereunder.” You state in your request that these are all-electric commercial vehicles.
The applicable subheading for the Passenger Vehicle Models will be 8702.40.3100, Harmonized Tariff Schedule of the United States (HTSUS), which provides for “Motor vehicles for the transport of ten or more persons, including the driver: With only electric motor for propulsion: Designed for the transport of 16 or more persons, including the driver.” The general rate of duty is 2 percent ad valorem.
The applicable subheading for the Battery Pack will be 8507.60.0020, which provides for Electric storage batteries, including separators therefor, whether or not rectangular (including square); parts thereof: Lithium-ion batteries: Other.” The general rate of duty is 3.4 percent ad valorem.
The applicable subheading for the Cargo Vehicle Models will be 8707.90.5090, HTSUS, which provides for “Bodies (including cabs), for the motor vehicles of headings 8701 to 8705: Other: Other: For other vehicles.” The general rate of duty is 4 percent ad valorem.
You suggested that the Front Suspension Assembly and the Rear Axle Assembly be classified in 8708.50.6500 as non-driving axles and 8708.50.6100 as drive axles, respectively.
Pursuant to GRI 3(b), goods which are prima facie classifiable under two or more headings, and which are mixtures, composite goods consisting of different materials or made up of different components, and goods put up in sets for retail sale, shall be classified as if they consisted of the material or component which gives them their essential character. GRI 3(c) provides, in pertinent part, “When goods cannot be classified by reference to Rule 3(a) or 3(b), they are to be classified in the heading which occurs last in numerical order among those which equally merit consideration in determining their classification.”
The Harmonized Commodity Description and Coding System Explanatory Notes (ENs) constitute the official interpretation of the Harmonized System. While not legally binding on the contracting parties, and therefore not dispositive, the ENs provide a commentary on the scope of each heading of the Harmonized System and are thus useful in ascertaining the classification of merchandise under the System. Customs believes the ENs should always be consulted. See T.D. 89 80, published in the Federal Register August 23, 1989 (54 FR 35127, 35128).
EN GRI 3(b)(IX) states that "[f]or purposes of [GRI 3(b)], composite goods made up of different components shall be taken to mean not only those in which the components are attached to each other to form a practically inseparable whole...."
This office notes that both assemblies fall within the definition of a composite good. Although there is no dispute that the assemblies are classifiable in heading 8708, HTSUS, neither of the components impart the essential character of the assemblies. Therefore, we must resort to GRI 3(c) and classify both products under the heading which occurs last in numerical order among those which equally merit consideration. In both assemblies the wheel hubs appear last in tariff.
This office needs additional information on the wheel hubs in both assemblies in order to issue a ruling. Please provide the following:
Are the wheel hubs flanged, double flanged or not flanged?
Please submit a clearly labelled, exploded view diagram (not a blueprint or a schematic) or other pictorial representations of the wheel hub assemblies.
As imported, do the wheel hubs incorporate any bearings? If yes, what type of bearings?
Duty rates are provided for your convenience and are subject to change. The text of the most recent Harmonized Tariff Schedule of the United States and the accompanying duty rates are provided on the World Wide Web at http://www.usitc.gov/current.
This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177).
A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, please contact National Import Specialist Liana Alvarez at [email protected].
Sincerely,
Steven A. Mack
Director
National Commodity Specialist Division