CLA-2-87:OT:RR:NC:N2:206
James MacNeill, Sr. HTS Classification Analyst
MacNeill Classification Compliance
P.O. Box 1214
Bristol, CT 06011
RE: The tariff classification of an e-axle from Germany
Dear Mr. McNeill:
In your letter dated December 12, 2022, you requested a tariff classification ruling. Pictures and other descriptive literature were submitted with your request.
The item under consideration has been identified as an E-Axle Assembly, which is used on electronic or hybrid vehicles. The e-axle assembly consists of two main components: the carrier housing and axle housing assemblies. The carrier housing assembly contains either one or two separate AC electric motors (depending on the e-axle version), a multi-speed shiftable planetary gear set functioning as a gearbox, and a drive-axle differential. The carrier housing also contains a heat exchange oil cooling module, engine and transmission coolant lines, oil pump and oil filter, temperature and speed sensors, electrical wire harness, high voltage connections and electrical busbar. The axle housing includes a steel housing for the differential and drive-axle half-shafts, two axle spindles for mounting wheel hubs, a tower bracket for connecting to the suspension system, and an axle bracket for a height control valve used in the suspension system. You state that the e-axle assembly does not include drive-axle half-shafts or wheel end assemblies in its imported condition. These components are attached to the e-axle assembly after importation.
In your letter you discussed possible classification of the e-axle assembly in heading 8501, Harmonized Tariff Schedule of the United States (HTSUS), which provides for electric motors, or subheading 8708.50, HTSUS, which for drive axles with differential, non-driving axles, and parts thereof. We believe none of the above suggestions are applicable to the item at issue.
Regarding heading 8501, HTSUS, ruling HQ 962289 states, “…a good consisting of a motor and the actual mechanism or a part of the mechanism the motor serves to power is beyond the scope of heading 8501, and is classified with the machine, apparatus or device with which it is solely or principally used.” In our view, a differential is not considered a gearbox. Past rulings have accepted motors where the differential or transitional gearing are integrated into the motor, similar to control electronics, as they contribute to the operation of the motor itself and facilitate the output. However, in cases where a motor is merely attached to or integrated into another assembly having a differential, transmission, clutch, etc. then this type of arrangement is beyond the scope of heading 8501.
With regard to subheading 8708.50, HTSUS, we agree that the assembly at issue extends beyond drive axles with differential or non-driving axles. Although the assembly consists of a differential, there are other components, such as electric motors that pushes the assembly beyond the scope of subheading 8708.50.
The applicable subheading for the E-Axle Assembly will be 8708.99.6890, HTSUS, which provides for “Parts and accessories of the motor vehicles of headings 8701 to 8705: Other parts and accessories: Other: Other: Other: Other: Other parts of power trains: Other.” The rate of duty will be 2.5% ad valorem.
Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on World Wide Web at https://hts.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