U.S. International Trade Commission

Brake Rotors from China

Investigation No. 731-TA-744 (Second Review)

Publication 4009 June 2008

Washington, DC 20436
U.S. International Trade Commission

COMMISSIONERS 

 

Daniel R. Pearson, Chairman 

Shara L. Aranoff, Vice Chairman 

Deanna Tanner Okun 

Charlotte R. Lane 

Irving A. Williamson 

Dean A. Pinkert

Staff assigned

Address all communications to 

Secretary to the Commission 

United States International Trade Commission 

Washington, DC 20436

Robert A. Rogowsky

Mary Messer, Investigator

Deborah McNay, Industry Analyst

Catherine DeFilippo, Economist

John Ascienzo, Accountant

Patrick Gallagher, Attorney

George Deyman, Supervisory Investigator

Director of Operations
U.S. International Trade Commission

Washington, DC 20436 

www.usitc.gov

Publication 4009 June 2008

Investigation No. 731-TA-744 (Second Review)

Brake Rotors from China

i

CONTENTS

Page

Determination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1

Views of the Commission . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3

Part I: Introduction and overview . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-1

Background . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-1

The original investigation and the expedited first five-year review . . . . . . . . . . . . . . . . . . . . I-2

Summary data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-4

Related investigation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-4

Statutory criteria and organization of the report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-10

Statutory criteria . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-10

Organization of the report . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-11

Commerce’s reviews . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-12

Distribution of Continued Dumping and Subsidy Offset Act funds . . . . . . . . . . . . . . . . . . . . . . . I-13

The subject merchandise . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-17

Commerce’s scope . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-17

Tariff treatment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-18

The product . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-19

Description and uses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-19

Manufacturing process . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-19

Channels of distribution and marketing considerations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-20

Premium and economy aftermarket brake rotors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-21

Domestic like product issues . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-23

U.S. market participants . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-28

U.S. producers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-28

U.S. importers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-35

U.S. purchasers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-36

Apparent U.S. consumption and market shares . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . I-37

Part II: Conditions of competition in the U.S. market ................................... II-1

U.S. market characteristics/channels of distribution . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-1

Supply and demand considerations ................................................ II-2

U.S. supply ............................................................... II-2

U.S. demand . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-4

Substitutability issues .......................................................... II-6

Factors affecting purchasing decisions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-6

Comparisons of domestic products, subject imports, and nonsubject imports ............ II-10

Elasticity estimates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-11

U.S. supply elasticity ........................................................ II-11

Subject supply elasticity ..................................................... II-12

U.S. demand elasticity . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . II-12

Substitution elasticity ....................................................... II-12
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CONTENTS

Page

Part III: Condition of the U.S. industry ............................................... III-1

U.S. producers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-1

U.S. producers’ capacity, production, and capacity utilization .......................... III-2

Premium vs. economy aftermarket brake rotors ................................... III-3

Alternative products ........................................................ III-4

Changes experienced in operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-5

Anticipated changes in operations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-5

U.S. producers’ domestic shipments, company transfers, and export shipments ............. III-6

U.S. producers’ inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-6

U.S. producers’ imports and purchases ............................................. III-7

U.S. producers’ employment, wages, and productivity ................................ III-8

Financial experience of U.S. producers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-8

Background ............................................................... III-8

Operations on aftermarket brake rotors . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-9

Capital expenditures and research and development expenses, assets and return on 

investment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . III-10

Part IV: U.S. imports and the subject industry in China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-1

U.S. importers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-1

U.S. imports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-2

U.S. importers’ inventories . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-5

The subject industry in China . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . IV-6

Part V: Pricing and related information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1

Factors affecting pricing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1

Raw materials . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1

Transportation costs to the U.S. market . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1

U.S. inland transportation costs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-1

Exchange rates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-2

Pricing practices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-2

Pricing methods . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-2

Discounts and promotions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-4

Price data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-4

Price trends . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-6

Price comparisons . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . V-7
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CONTENTS

Page

Appendixes

A. Federal Register notices and the Commission’s statement on adequacy . . . . . . . . . . . . . . . . . . A-1

B. Calendar of the public hearing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . B-1

C. Summary data . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . C-1

D. Responses of U.S. producers, U.S. importers, U.S. purchasers, and Chinese producers 

 concerning the significance of the antidumping duty order and the likely effects of 

 revocation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . D-1

Note.–Information that would reveal confidential operations of individual concerns may not be

published and therefore has been deleted from this report. Such deletions are indicated by

asterisks.
 
 1

 The record is defined in sec. 207.2(f) of the Commission’s Rules of Practice and Procedure (19 CFR § 207.2(f)).

UNITED STATES INTERNATIONAL TRADE COMMISSION

Investigation No. 731-TA-744 (Second Review)

BRAKE ROTORS FROM CHINA

DETERMINATION

On the basis of the record1

 developed in the subject five-year review, the United States

International Trade Commission (Commission) determines, pursuant to section 751(c) of the Tariff Act of

1930 (19 U.S.C. § 1675(c)), that revocation of the antidumping duty order on brake rotors from China

would not be likely to lead to continuation or recurrence of material injury to an industry in the United

States within a reasonably foreseeable time.

BACKGROUND

The Commission instituted this review on July 2, 2007 (72 F.R. 36037) and determined on

October 5, 2007 that it would conduct a full review (72 F.R. 59111, October 18, 2007). Notice of the

scheduling of the Commission’s review and of a public hearing to be held in connection therewith was

given by posting copies of the notice in the Office of the Secretary, U.S. International Trade Commission,

Washington, DC, and by publishing the notice in the Federal Register on November 27, 2007 (72 F.R.

66187). The hearing was held in Washington, DC, on April 15, 2008, and all persons who requested the

opportunity were permitted to appear in person or by counsel.
 
 1

 The members of the Coalition were Brake Parts, Inc.; Iroquois Tool Systems, Inc.; Kinetic Parts Manufacturing,

Inc.; and Wagner Brake Corp.

 2

 Certain Brake Drums and Rotors from China, Inv. No. 731-TA-744 (Preliminary), USITC Pub. 2957 (April

1996) (“Original Preliminary Investigation”) at 1.

 3

 ITT Automotive, which accounted for *** percent of total 1995 reported U.S. production of aftermarket brake

rotors, *** in the original investigation.

 4

 Original Preliminary Investigation, Staff Report at III-1.

 5

 Original Preliminary Investigation at 11.

 6

 Certain Brake Drums and Rotors from China, Inv. No. 731-TA-744 (Final), USITC Pub. 3035 (April 1997)

(“Original Investigation”) at 1.

 7

 Notice of Antidumping Duty Order: Brake Rotors from the People’s Republic of China, 62 Fed. Reg. 18740. 

In the original investigation, the Commission determined that there were two domestic like products – brake drums

and brake rotors. The Commission made a negative injury determination on brake drums that was affirmed on

appeal. See The Coalition for the Preservation of American Brake Drum and Rotor Aftermarket Manufacturers v.

United States, 22 CIT 520 (June 17, 1998). Accordingly, the antidumping duty order was issued on aftermarket

brake rotors only.

 8

 Brake Rotors from China, 67 Fed. Reg. 9462.

3

VIEWS OF THE COMMISSION

Based on the record in this five-year review, we determine under section 751(c) of the Tariff Act

of 1930, as amended (the “Act”), that revocation of the antidumping duty order on aftermarket brake

rotors from China would not be likely to lead to continuation or recurrence of material injury to an

industry in the United States within a reasonably foreseeable time.

I. BACKGROUND

A. The Original Investigation

On March 7, 1996, a petition was filed by the Coalition for the Preservation of American Brake

Drum and Rotor Aftermarket Manufacturers (“Coalition”)1

 alleging that industries in the United States

were being materially injured or threatened with material injury by reason of less than fair value imports

of certain brake drums and rotors from China.2

 In the original investigation, there were eight domestic

producers of finished aftermarket brake rotors comprising the domestic industry: Airtex; Brake Parts, Inc.

(“Brake Parts”); Excel; Iroquois Tool Systems, Inc. (“Iroquois”); ITT Automotive, Inc. (“ITT

Automotive”);3

 Kinetic Parts Manufacturing, Inc. (“Kinetic”); Overseas Auto Parts, Inc. (“Overseas”);

and Wagner Brake Corp. (“Wagner”).4

 The Commission excluded a ninth firm, AlliedSignal Automotive

(“AlliedSignal”), from the definition of the domestic industry, because its primary interest was in the

importation of the subject brake rotors.5

 In April 1997, the Commission found that a domestic industry

was materially injured by imports of aftermarket brake rotors from China that the U.S. Department of

Commerce (“Commerce”) found to be sold at less than fair value.6

 Commerce issued an antidumping

duty order on aftermarket brake rotors from China on April 17, 1997.7

B. The First Five-Year Review

On March 1, 2002, the Commission instituted its first (expedited) review of the antidumping duty

order on aftermarket brake rotors from China.8

 In July of 2002, the Commission found that revocation of

the antidumping duty order was likely to lead to continuation or recurrence of material injury to the
 9

 Brake Rotors from China, Inv. No. 731-TA-744 (Review), USITC Pub. 3528 (July 2002) (“First Five-Year

Review”).

 10 67 Fed. Reg. 52933.

 11 The membership of the Coalition at that time consisted of Dana Corp., Brake and Chassis Division; FederalMogul Corp.; and Waupaca Foundry, Inc.

 12 68 Fed. Reg. 35702 (June 16, 2003); 19 U.S.C. § 2451(b).

 13 The scope definition of aftermarket brake rotors examined in the section 421 investigation is the same as the

scope in the current review.

 14 68 Fed. Reg. 48938 (August 15, 2003).

 15 The Commission found that domestic original equipment manufacturer (“OEM”) brake drums and rotors were

not like or directly competitive with the imported subject Chinese product and that there was a clear dividing line

between OEM brake drums and rotors and aftermarket brake drums and rotors. OEM brake drums and rotors were

not included in the scope of the investigation, and there were no known imports of the OEM product from China

during the period examined in the section 421 investigation. Certain Brake Drums and Rotors From China, USITC

Publication 3622 (August 2003) at 7-14; and Brake Rotors From China, USITC Publication 3528 (July 2002) at 4-6. 

The Chinese respondents in this current review indicated that the facts concerning OEM and aftermarket brake rotors

remain the same today. Chinese Respondents Group Posthearing Brief at Q-6 - Q-7.

 16 72 Fed. Reg. 36037.

 17 Since the institution, Federal-Mogul has closed its last remaining U.S. aftermarket brake rotor production

facility, has left the Coalition, and now opposes the continued imposition of the order. Consequently, Affinia is the

only party remaining in the “Coalition.”

4

domestic aftermarket brake rotor industry.9

 Commerce issued its notice continuing the antidumping duty

order on aftermarket brake rotors from China on August 14, 2002.10

C. Related Investigation

Following receipt of a petition, as amended, on June 6, 2003, on behalf of the Coalition,11 the

Commission instituted an investigation of Certain Brake Drums and Rotors from China, under section

421(b) of the Trade Act of 1974.12 The Commission completed its section 421 investigation in August

2003, finding that certain (aftermarket) brake drums and certain (aftermarket) brake rotors13 from China

were not being imported into the United States in such increased quantities or under such conditions as to

cause or threaten to cause market disruption to the domestic producers of like or directly competitive

products.14 The Commission found that aftermarket brake drums and aftermarket brake rotors were two

distinct like or directly competitive products and that there were two separate domestic industries

consisting of the U.S. producers of aftermarket brake drums and the U.S. producers of aftermarket brake

rotors.15

D. The Second Five-Year Review

On July 2, 2007, the Commission instituted this review pursuant to section 751(c) of the Act to

determine whether the revocation of the antidumping duty order on imports of aftermarket brake rotors

from China would be likely to lead to a continuation or recurrence of material injury.16 The Commission

received a response to the notice of institution from the Coalition, an unincorporated association then

consisting of two domestic producers of aftermarket brake rotors, Affinia Group, Inc. (“Affinia”) and

Federal-Mogul, Inc. (“Federal-Mogul”), including individually adequate responses from the two domestic

producers.17 These two U.S. producers claimed to have accounted for all U.S. production of aftermarket
 18 Coalition Response to Notice of Institution at 26.

 19 CR/PR at I-1; Explanation of Commission’s Determination on Adequacy.

 20 72 Fed. Reg. 59111 (October 18, 2007).

 21 Explanation of Commission’s Determination on Adequacy.

 22 The Chinese Respondents Group is comprised of Qingdao Mieta Automotive Industry Co., Ltd.; Longkou

Jinzheng Machinery Co., Ltd.; Longkou Haimeng Machinery Co., Ltd.; Longkou TLC Machinery Co., Ltd.; Laizhou

Hongda Auto Replacement Parts Co., Ltd.; World Known Precision Industry (Fuzhou) Co., Ltd.; Shandong Huanri

Group Co., Ltd.; Shanxi Zhongding Auto Parts Co., Ltd.; Laihou Wally Automobile Co., Ltd.; Laizhou City Luqi

Machinery Co., Ltd.; Yantai Winhere Auto-Part Manufacturing Co., Ltd.; Qingdao Gren (Group) Co.; CWD, LLC

dba Centric Parts; Gren Automotive, Inc.; IAP West, Inc.; Qualis Automotive LLC; Zhongqiao USA International

Corp. dba Best Brakes; and Ziway, Inc. 

 23 Federal-Mogul and the Chinese Respondents Group have requested that the Commission take an adverse

inference with respect to Affinia’s failure to submit a prehearing brief or to attend the Commission’s hearing in this

review, arguing that Affinia has failed to cooperate to the best of its ability. Federal-Mogul Prehearing Brief at 18-

24; Chinese Respondents Group Posthearing Brief at Q-2 to Q-7. The statute, however, provides that adverse

inferences may only be taken when there is a lack of cooperation with a request for information. 19 U.S.C. §

1677e(b). The statute does not authorize the Commission to take an adverse inference where, for example, an

interested party chooses not to avail itself of opportunities to present arguments to the Commission through the

submission of case briefs or through argument at a public hearing but, nevertheless, responds to the Commission’s

questionnaires and cooperates with requests for data. Accordingly, we decline to take adverse inferences with

respect to Affinia’s failure to submit a prehearing brief or to appear at the Commission’s hearing in this review.

5

brake rotors in 2006.18 The Commission also received one adequate interested party group response from

12 Chinese producers/exporters, as well as from three U.S. importers of aftermarket brake rotors from

China.19

On October 5, 2007, the Commission determined to conduct a full review.20 The Commission

determined that both the domestic interested party group response and the respondent interested party

group response to the Commission’s notice of institution were adequate.21

E. Parties to the Proceeding

The Commission received prehearing briefs from Federal-Mogul and a Chinese Respondents

Group, representing 18 firms that are either Chinese brake rotor producers/exporters or U.S.

importers/purchasers of subject rotors.22 Representatives of Federal-Mogul and the Chinese Respondents

Group appeared at the Commission’s hearing. Affinia did not file a prehearing brief or appear at the

Commission’s hearing.23 The Commission received posthearing briefs from Affinia, Federal-Mogul, and

the Chinese Respondents Group, and it received final comments from Federal-Mogul and the Chinese

Respondents Group.

II. DOMESTIC LIKE PRODUCT AND INDUSTRY

A. Domestic Like Product

In its expedited five-year review determination, Commerce defined the scope of the subject

merchandise as:

. . . brake rotors made of gray cast iron, whether finished, semifinished, or

unfinished, ranging in diameter from 8 to 16 inches (20.32 to 40.64 centimeters) and in

weight from 8 to 45 pounds (3.63 to 20.41 kilograms). The size parameters (weight and
 24 Brake Rotors from the People’s Republic of China: Notice of Final Results of Expedited Second Sunset

Review of Antidumping Duty Order, 73 Fed. Reg. 1319 (January 8, 2008). Commerce noted that the subject

merchandise is classifiable currently under items 8708.39.5010, 8708.39.5030, and 8708.30.5030 of the Harmonized

Tariff Schedule of the United States. Id. Commerce also noted that brake rotors produced by Federal-Mogul and

certified by the Ford Motor Company were excluded from the scope of the order. Id. at n.2.

 25 CR at I-21, PR at I-19.

 26 Staff Report, INV-U-020 (March 18, 1997), citing Hearing Transcript at 131.

 27 Brake rotors can be and have been manufactured from aluminum. The advantage of an aluminum brake rotor is

in its light weight. CR at I-21, PR at I-19.

6

dimension) of the brake rotors limit their use to the following types of motor vehicles:

automobiles, all-terrain vehicles, vans and recreational vehicles under “one ton and a

half,” and light trucks designated as “one ton and a half.”

Finished brake rotors are those that are ready for sale and installation without any

further operations. Semi-finished rotors are those on which the surface is not entirely

smooth, and have undergone some drilling. Unfinished rotors are those which have

undergone some grinding or turning.

These brake rotors are for motor vehicles, and do not contain in the casting a logo

of an original equipment manufacturer (“OEM”) which produces vehicles sold in the

United States. (e.g., General Motors, Ford, Chrysler, Honda, Toyota, Volvo). Brake

rotors covered in this order are not certified by OEM producers of vehicles sold in the

United States. The scope also includes composite brake rotors that are made of gray cast

iron, which contain a steel plate, but otherwise meet the above criteria. Excluded from

the scope of this order are brake rotors made of gray cast iron, whether finished,

semifinished, or unfinished, with a diameter less than 8 inches or greater than 16 inches

(less than 20.32 centimeters or greater than 40.64 centimeters) and a weight less than 8

pounds or greater than 45 pounds (less than 3.63 kilograms or greater than 20.41

kilograms).24

Aftermarket brake rotors are used in automobiles as replacement parts. Brake rotors are part of

disc brake assemblies, commonly used on front-wheel-drive vehicles, in which braking action is created

by a hydraulic caliper that presses two brake pads against a rotating disk, or rotor, that is attached to the

wheel hub.25 The braking unit is not enclosed, allowing disc brakes to transfer efficiently the heat

generated by braking action. Efficient heat transfer is an important quality in front-wheel-drive vehicles,

since more of the vehicle’s weight is concentrated in its front end, thus requiring more braking force to be

applied to the front wheel brake assemblies. The increased number of front-wheel-drive motor vehicles

on the road in the United States has contributed to greater demand for rotors, as has a design shift to a

disc braking system using four, rather than two, brake rotors.26

Brake rotors are generally produced from gray iron,27 which has high wear resistance, excellent

machinability, a relatively high coefficient of friction, and vibration absorption. This metal is also easily

cast into rather complex shapes at a relatively low cost. After the raw casting is formed, the article

undergoes machining, such as grinding and drilling, to reach the finished product. Unfinished brake

rotors have undergone some grinding or turning, but are not functional as brake system products. 

Semifinished brake rotors have also undergone initial grinding and have been drilled or pierced. Such
 28 There is no standard industry concept of the terms “unfinished” and “semifinished” brake rotors. These

products are not traded in significant quantities and are not suitable for any other use. Original Preliminary

Investigation, USITC Pub. 2957, at 9 n.48.

 29 CR at I-21, n.45, PR at I-19, n.45.

 30 Original Investigation, USITC Pub. 3035 at 4-9. 

 31 Original Investigation, USITC Pub. 3035 at 9 n.43.

 32 Original Investigation, USITC Pub. 3035 at 1.

 33 First Five-Year Review, USITC Pub. 3528 at 5.

 34 See 66 Fed. Reg. 38544, 38545, 38546, and 38547 (July 24, 1996).

 35 CR at I-30, PR at I-24. In the institution phase of the review, the Coalition agreed, in its response to the notice

of institution, with the Commission’s definition of the domestic like product. Coalition Response to Notice of

Institution at 32. The Chinese Respondents Group also agreed that the Commission should not define the domestic

like product differently. Chinese Respondents Group Posthearing Brief at Q-7.

 36 Both Federal-Mogul and the Chinese Respondents Group argue that it is likely that there would be no domestic

production and, hence, no domestic industry in the reasonably foreseeable future because of Affinia’s alleged focus

on imports and Affinia’s reported intent to sell its last remaining U.S. aftermarket brake rotor facility in Waupaca,

Wisconsin. Consequently, Federal-Mogul and the Chinese Respondents Group argue, there will be no production of

the domestic like product in the reasonably foreseeable future. See e.g., Federal-Mogul Posthearing Brief at 10-18

and Prehearing Brief at Exhibit 1 (Affinia 10-K Report at 24); and Chinese Respondents Group Brief at Q-11. The

record demonstrates, however, that Affinia has continued to produce the domestic like product throughout the period

of review and ***. E-mail from ***. In addition, Affinia reports that ***. E-mail from ***. Given the evidence on

the record, the claim that Affinia will end domestic production of aftermarket brake rotors within a reasonably

foreseeable time is speculative and we do not find that it is likely.

7

parts still require additional finish grinding and boring to be considered serviceable.28 Finished brake

rotors are ready for installation and meet fit and function criteria. Brake rotors also may be manufactured

from aluminum because of this material’s light weight.29 

In the original investigation, the Commission examined (1) whether brake rotors and brake drums

were distinct domestic like products and (2) whether the domestic like product(s) should be limited to

aftermarket (i.e., non-OEM) products or should encompass OEM products as well. The Commission

determined that brake rotors and brake drums were separate domestic like products. The Commission

also determined that OEM rotors and drums and aftermarket rotors and drums, although physically

similar, were different products made by different manufacturers for different markets. The Commission

therefore found two domestic like products consisting of aftermarket brake rotors and aftermarket brake

drums.30 The Commission also found that these domestic like products included “unfinished” and “semifinished” rotors and drums as well as finished rotors and drums.31 As previously noted, the Commission

made an affirmative determination only with respect to aftermarket brake rotors.32

In the first five-year review of the antidumping duty order, which only pertained to aftermarket

brake rotors, no party requested the Commission to change the like product definition it had adopted in

the original investigation, and the Commission indicated that nothing in the record supported departing

from the prior definition. Accordingly, the Commission again defined the domestic like product as

aftermarket brake rotors, consistent with the scope of the review.33

The definition of the scope of the current sunset review, as set out above, is unchanged from

Commerce’s definition in the original investigation and the first five-year review.34 In this review, no

interested party has suggested changes to the definition of the domestic like product, nor has the

Commission obtained any new information that indicates a need to revisit that definition.35 Accordingly,

we define the domestic like product as aftermarket brake rotors, consistent with the scope of the review.36
 37 19 U.S.C. § 1677(4)(A).

 38 CR/PR at III-1.

 39 In defining the domestic industry, the Commission’s general practice has been to include producers of all

domestic production of the like product, whether toll-produced, captively consumed, or sold in the domestic

merchant market, provided that adequate production-related activity is conducted in the United States. In assessing

the nature and extent of production-related activities in the United States associated with a particular operation, the

Commission generally considers six factors:

(1) source and extent of the firm’s capital investment;

(2) technical expertise involved in U.S. production activities;

(3) value added to the product in the United States;

(4) employment levels;

(5) quantity and type of parts sourced in the United States; and

(6) any other costs and activities in the United States directly leading to production of the like product.

No single factor is determinative and the Commission may consider any other factors it deems relevant in light of the

specific facts of any investigation or review.

The Chinese Respondents Group argues that Affinia does not have sufficient production-related activities in

the United States to still be considered a member of the domestic industry for the purposes of this review, basing its

argument on the volume of aftermarket brake rotors produced by Affinia during the first quarter of 2008. Chinese

Respondents Group Prehearing Brief at 2-6 and Posthearing Brief at Q-4. Affinia, however, accounted for more

than *** percent of the U.S. production of aftermarket brake rotors during the period of review and produced more

than *** million rotors in 2007. CR/PR at Table III-1. Moreover, the statute does not set any minimum benchmark

on how much domestic consumption must be supplied by a U.S. producer before such a producer may be considered

a part of an “industry.” Indeed, the statute contemplates, in certain circumstances, through its material retardation of

the establishment of an industry provision, that there may be no current production, yet an industry may be found to

exist. Accordingly, we reject the Chinese Respondents Group’s argument on this basis.

 40 Waupaca, a subsidiary of the Budd Co./Thyssen Krupp Automotive, was an independent foundry that produced

raw castings, some of which it sold to *** for finishing. In this review, Waupaca indicated that it does not perform

any finishing on the raw castings it produces. Letter from Kris Pfaehler, Vice President of Sales and Marketing,

ThyssenKrupp Waupaca, dated April 24, 2008, and telephone interview with ***.

 41 There are several small, low-volume producers of specialty brake rotors in the United States that sell to niche

markets, such as the racing industry. These companies include PowerStop, Wilwood, and PPG. Affinia has argued,

however, that these firms do not produce brake rotors and are not part of the domestic industry that services the

general automobile and light truck aftermarket. Affinia explained that these firms simply purchase imported or

domestically produced rotors and perform specialized machining on them. Coalition’s Response to the

(continued...)

8

B. Domestic Industry and Related Parties

Section 771(4)(A) of the Act defines the relevant industry as the “domestic producers as a whole

of a like product, or those producers whose collective output of the like product constitutes a major

proportion of the total domestic production of that product.”37

Affinia and Federal-Mogul are the only known domestic producers of aftermarket brake rotors,

with Affinia producing throughout the period of review and Federal-Mogul producing until September of

2007.38 39 While ThyssenKrupp Waupaca, Inc. (formerly Waupaca Foundry) produces castings for

aftermarket brake rotors, the company does not produce aftermarket brake rotors, whether finished, semifinished, or unfinished.40 Several other firms are known to produce small-volume, highly specialized

brake rotors for applications such as racing cars, but no evidence in the record establishes that these

products are brake rotors for the aftermarket, as we have defined the domestic like product.41
 41 (...continued)

Commission’s Notice of Institution at 20-21. The record does not establish that these entities produce brake rotors

for the aftermarket and we do not consider them members of the domestic industry.

 42 19 U.S.C. § 1677(4)(B).

 43 See, e.g., Sandvik AB v. United States, 721 F. Supp. 1322, 1331-32 (Ct. Int’l Trade 1989), aff’d mem., 904

F.2d 46 (Fed. Cir. 1990); Empire Plow Co. v. United States, 675 F. Supp. 1348, 1352 (Ct. Int’l Trade 1987). The

primary factors the Commission has examined in deciding whether appropriate circumstances exist to exclude the

related parties include: (1) the percentage of domestic production attributable to the importing producer; (2) the

reason the U.S. producer has decided to import the product subject to investigation, i.e., whether the firm benefits

from the less than fair value sales or subsidies or whether the firm must import in order to enable it to continue

production and compete in the U.S. market; and (3) the position of the related producers vis-a-vis the rest of the

industry, i.e. whether inclusion or exclusion of the related party will skew the data for the rest of the industry. See,

e.g., Torrington Co. v. United States, 790 F. Supp. 1161, 1168 (Ct. Int’l Trade 1992), aff’d mem., 991 F.2d 809 (Fed.

Cir. 1993). The Commission has also considered the ratio of import shipments to U.S. production for related

producers and whether the primary interests of the related producers lie in domestic production or in importation. 

See, e.g., Melamine Institutional Dinnerware from China, Indonesia, and Taiwan, Invs. Nos. 731-TA-741-743

(Final), USITC Pub. 3016 at 14 n.81 (Feb. 1997).

 44 See, e.g., USEC, Inc. v. United States, 132 F. Supp.2d 1, 12 (Ct. Int’l Trade 2001).

 45 Affinia Posthearing Brief at 5.

 46 CR at III-24, PR at III-7; and Affinia Producer Questionnaire Response at Question II-13.

 47 CR at I-44 to I-46 & n.137, PR at I-34 to I-35 & n.137. See e.g., Foundry Coke from China, Inv. No. 731-TA891 (Final), USITC Pub. 3449 (September 2001) at 8-9; Certain Cut-to-Length Steel Plate from the Czech Republic,

France, India, Indonesia, Italy, Japan, Korea, and Macedonia, Inv. Nos. 701-TA-387-392 and 731-TA-815-822

(Preliminary), USITC Pub. 3181 at 12 (April 1999); Certain Brake Drums and Rotors from China, Inv. No.

731-TA-744 (Final), USITC Pub. 3035 at 10 n.50 (April 1997). See also SAA at 858.

 48 See Affinia’s U.S. Producer Questionnaire Response at Question II-13. Affinia has ***. Affinia reported that

it purchases brake rotors from entities related to MAT Holdings, but it reported that all such purchases are on an

arms-length basis. Affinia Posthearing Brief at 5.

9

In defining the domestic industry, we examine whether any producer of the domestic like product

should be excluded from the domestic industry pursuant to the related party provision of the Act, section

771(4)(B). That provision of the statute allows the Commission, if appropriate circumstances exist, to

exclude from the domestic industry producers that are related to an exporter or importer of subject

merchandise or which are themselves importers.42 Exclusion of such a producer is within the

Commission’s discretion based upon the facts presented in each case.43 The purpose of the provision is to

exclude domestic producers that substantially benefit from importation of subject merchandise or their

relationships with foreign exporters.44

1. Affinia

The record does not support the conclusion that Affinia is a related party. Affinia is not the

importer of record for imports of subject rotors during the period of review, nor was it related to any

Chinese producer or exporter or to any U.S. importer of subject rotors during the period of review.45

Although Affinia is ***, accounting for *** percent of total reported subject exports from China in 2007,

Affinia made these purchases from *** separate suppliers during the period of review.46 There is no

record evidence that these purchases account for the predominant proportion of imports by any of these

four suppliers, which is the standard used by the Commission to determine whether a purchaser should be

deemed a related party.47 Finally, Affinia’s relationship with *** appears to be limited to nonsubject

imports.48 Consequently, we find that Affinia is not a “related party” as defined by the statute,

notwithstanding Affinia’s purported status as a significant distributor/reseller of subject rotors during the
 49 CR/PR at Table III-6.

 50 The statute requires a determination of whether to exclude related parties from the domestic industry. FederalMogul, however, ceased domestic production of aftermarket brake rotors in 2007, and a five-year review pertains to

events likely to occur within the reasonably foreseeable future. Accordingly, regardless of whether Federal-Mogul is

excluded from the industry on related party grounds, we do not consider it to be a member of the domestic industry

for purposes of our forward-looking analysis. Our determination of whether to exclude Federal-Mogul affects only

whether the data collected with respect to the domestic industry during the period of review should include data

reported by Federal-Mogul.

 51 CR/PR at Table III-6. The ratio of Federal-Mogul’s *** to U.S. production increased overall from *** percent

in 2002 to *** percent in 2006, and was *** percent in 2007. Federal-Mogul ceased U.S. production in September

2007. CR/PR at Table III-6; and CR at III-3, PR at III-1.

 52 CR at III-23 to III-24, PR at III-7.

 53 CR/PR at Table III-9.

 54 Consistent with her practice in past investigations and reviews, Vice Chairman Aranoff does not rely on

individual-company operating margins in assessing whether a related party has benefitted from importation of

subject merchandise. Rather, she determines whether to exclude a related party based principally on its ratio of

subject imports to domestic production and whether its primary interests lie in domestic production or importation. 

In the present review, the ratio of Federal-Mogul’s *** to domestic production was consistently greater

than *** percent from 2002 to 2006, and was *** greater in 2007. CR/PR at Table III-6. In several past

investigations and reviews, the Vice Chairman found that import to production ratios greater than 100 percent

indicated that the primary interests of the related party lay in importation rather than domestic production. Here,

however, the Vice Chairman notes that Federal-Mogul’s *** fell primarily into the economy grade, while its ***

concentrated on the premium grade. Given the difference in price between the two grades, the value of FederalMogul’s shipments of its *** has been *** greater than the value of its subject imports for each year since 2002,

with the exception of 2007. Compare CR/PR at Table III-4 (values of shipments of domestic product) with ***. She

notes additionally that Federal-Mogul ***. CR at III-23 to III-24, PR at III-7. Based on the facts in this review,

Vice Chairman Aranoff finds that Federal-Mogul’s primary interests lay in domestic production during most of the

period of review, and on that basis determines that appropriate circumstances do not exist to exclude the producer

from the domestic industry.

 55 In this review, Commissioner Pinkert does not rely upon Federal-Mogul’s financial performance as a factor in

determining whether there are appropriate circumstances to exclude it from the domestic industry and relies instead

on other information relevant to this issue. The present record is not sufficient to infer from Federal-Mogul’s

financial performance on U.S. operations whether it derived a specific benefit from importing. See Allied Mineral

Products, Inc. v. United States, 28 CIT 1861, 1865-67 (2004).

10

period of review. Although we do not exclude Affinia, we consider Affinia’s *** marketing of the

subject merchandise to be a condition of competition affecting this industry.

2. Federal-Mogul

We find that Federal-Mogul is a related party under the statute due to *** during the period of

review at the same time it was a domestic producer.49 We also find, however, that appropriate

circumstances do not exist to warrant excluding Federal-Mogul from the definition of the domestic

industry.50 Federal-Mogul’s *** the company’s U.S. production during the period of review, and its ratio

of *** to U.S. production increased in each year during the period except for ***.51 Federal-Mogul

claims, however, that ***.52 Although Federal-Mogul no longer supports the continuation of the order,

Federal-Mogul’s financial data suggest that it did not perform appreciably better over the period of review

due to ***.53 54 55 Therefore, we find that appropriate circumstances do not exist to exclude FederalMogul from the definition of the domestic industry.
 56 19 U.S.C. § 1675a(a).

 57 The SAA, H.R. Rep. No. 103-316, vol. I, at 883-84 (1994). The SAA states that “[t]he likelihood of injury

standard applies regardless of the nature of the Commission’s original determination (material injury, threat of

material injury, or material retardation of an industry). Likewise, the standard applies to suspended investigations

that were never completed.” SAA at 883. 

 58 While the SAA states that “a separate determination regarding current material injury is not necessary,” it

indicates that “the Commission may consider relevant factors such as current and likely continued depressed

shipment levels and current and likely continued [sic] prices for the domestic like product in the U.S. market in

making its determination of the likelihood of continuation or recurrence of material injury if the order is revoked.” 

SAA at 884.

11

In light of our domestic like product determination, we find that the domestic industry consists of

all domestic producers of aftermarket brake rotors during the review period, i.e., Affinia and FederalMogul.

III. NO LIKELIHOOD OF CONTINUATION OR RECURRENCE OF MATERIAL INJURY

IF THE ANTIDUMPING DUTY ORDER WERE REVOKED

For the reasons stated below, we determine that revocation of the antidumping duty order on

aftermarket brake rotors from China would not be likely to lead to continuation or recurrence of material

injury to the domestic industry producing aftermarket brake rotors within a reasonably foreseeable time.

A. Legal Standard In a Five-Year Review

In a five-year review conducted under section 751(c) of the Act, Commerce will revoke an

antidumping or countervailing duty order unless: (1) it makes a determination that dumping or

subsidization is likely to continue or recur; and (2) the Commission makes a determination that revocation

of the antidumping duty order or the countervailing duty order “would be likely to lead to continuation or

recurrence of material injury within a reasonably foreseeable time.”56 The Uruguay Round Agreements

Act (“URAA”), Statement of Administrative Action (“SAA”), states that “under the likelihood standard,

the Commission will engage in a counter-factual analysis; it must decide the likely impact in the

reasonably foreseeable future of an important change in the status quo – the revocation or termination of a

proceeding and the elimination of its restraining effects on volumes and prices of imports.”57 Thus, the

likelihood standard is prospective in nature.58 The U.S. Court of International Trade has found that
 59 See NMB Singapore Ltd. v. United States, 288 F. Supp. 2d 1306, 1352 (Ct. Int’l Trade 2003) (“‘likely’ means

probable within the context of 19 U.S.C. § 1675(c) and 19 U.S.C. § 1675a(a)”), aff’d without opinion, 140 Fed.

Appx. 268 (Fed. Cir. 2005); Nippon Steel Corp. v. United States, 26 CIT 1416, 1419 (2002) (same); Usinor

Industeel, S.A. v. United States, 26 CIT 14 02, 1404 nn. 3 & 6 (2002) (“more likely than not” standard is “consistent

with the court’s opinion”; “the court has not interpreted ‘likely’ to imply any particular degree of ‘certainty’”);

Indorama Chemicals (Thailand) Ltd. v. United States, 26 CIT 1059, 1070 (2002) (“standard is based on a likelihood

of continuation or recurrence of injury, not a certainty”); Usinor v. United States, 26 CIT 767, 794 (2002) (“‘likely’

is tantamount to ‘probable,’ not merely ‘possible’”).

 60 For a complete statement of Commissioner Okun’s interpretation of the likely standard, see Additional Views

of Vice Chairman Deanna Tanner Okun Concerning the “Likely” Standard in Certain Seamless Carbon and Alloy

Steel Standard, Line and Pressure Pipe from Argentina, Brazil, Germany, and Italy, Inv. Nos. 701-TA-362 (Review)

and 731-TA-707-710 (Review) (Remand), USITC Pub. 3754 (Feb. 2005).

 61 Commissioner Lane notes that, consistent with her views in Pressure Sensitive Plastic Tape from Italy, Inv. No.

AA1921-167 (Second Review), USITC Pub. 3698 (June 2004) at 15-17, she does not concur with the U.S. Court of

International Trade’s interpretation of “likely,” but she will apply the Court’s standard in this review and all

subsequent reviews until either Congress clarifies the meaning or the U.S. Court of Appeals for the Federal Circuit

addresses the issue.

 62 19 U.S.C. § 1675a(a)(5).

 63 SAA at 887. Among the factors that the Commission should consider in this regard are “the fungibility or

differentiation within the product in question, the level of substitutability between the imported and domestic

products, the channels of distribution used, the methods of contracting (such as spot sales or long-term contracts),

and lead times for delivery of goods, as well as other factors that may only manifest themselves in the longer term,

such as planned investment and the shifting of production facilities.” Id.

 64 19 U.S.C. § 1675a(a)(1).

 65 19 U.S.C. § 1675a(a)(1). Commerce has not made any duty absorption determinations with respect to the order

under review. CR at I-14, PR at I-12 to I-13. The statute further provides that the presence or absence of any factor

that the Commission is required to consider shall not necessarily give decisive guidance with respect to the

Commission’s determination. 19 U.S.C. § 1675a(a)(5). While the Commission must consider all factors, no one

factor is necessarily dispositive. SAA at 886.

12

“likely,” as used in the five-year review provisions of the Act, means “probable,” and the Commission

applies that standard in five-year reviews.59 60 61

The statute states that “the Commission shall consider that the effects of revocation or termination

may not be imminent, but may manifest themselves only over a longer period of time.”62 According to

the SAA, a “‘reasonably foreseeable time’ will vary from case-to-case, but normally will exceed the

‘imminent’ timeframe applicable in a threat of injury analysis in original investigations.”63

Although the standard in a five-year review is not the same as the standard applied in an original

antidumping or countervailing duty investigation, it contains some of the same fundamental elements. 

The statute provides that the Commission is to “consider the likely volume, price effect, and impact of

imports of the subject merchandise on the industry if the orders are revoked or the suspended

investigation is terminated.”64 It directs the Commission to take into account its prior injury

determination, whether any improvement in the state of the industry is related to the order or the

suspension agreement under review, whether the industry is vulnerable to material injury if the orders are

revoked or the suspension agreement is terminated, and any findings by Commerce regarding duty

absorption pursuant to 19 U.S.C. § 1675(a)(4).65

In this review, the Commission received questionnaire responses with usable data from various

market participants including Affinia, Federal-Mogul, 21 U.S. importers, and 13 Chinese
 66 Data collected by the Commission from U.S. aftermarket brake rotor producers represent 100 percent of total

U.S. aftermarket brake rotor shipments. CR/PR at III-1. Based on official Commerce statistics for U.S. imports of

brake rotors, Chinese industry coverage accounted for at least 73.6 percent of total U.S. imports of subject brake

rotors in 2007. CR at IV-13, PR at IV-7.

 67 19 U.S.C. § 1677e(a) authorizes the Commission to “use the facts otherwise available” in reaching a

determination when: (1) necessary information is not available on the record or (2) an interested party or other

person withholds information requested by the agency, fails to provide such information in the time, form, or manner

requested, significantly impedes a proceeding, or provides information that cannot be verified pursuant to section

782(i) of the Act. 19 U.S.C. § 1677e(a). The verification requirements in section 782(i) are applicable only to

Commerce. 19 U.S.C. § 1677m(i). See Titanium Metals Corp. v. United States, 25 CIT 648, 663, 155 F. Supp. 2d

750, 765 (2001) (“[T]he ITC correctly responds that Congress has not required the Commission to conduct

verification procedures for the evidence before it, or provided a minimum standard by which to measure the

thoroughness of a Commission investigation.”).

 68 Commissioner Okun notes that the statute authorizes the Commission to take adverse inferences in five-year

reviews, but such authorization does not relieve the Commission of its obligation to consider the record evidence as

a whole in making its determination. 19 U.S.C. § 1677e. She generally gives credence to the facts supplied by the

participating parties and certified by them as true, but bases her decision on the evidence as a whole, and does not

automatically accept participating parties’ suggested interpretations of the record evidence. Regardless of the level

of participation and the interpretations urged by participating parties, the Commission is obligated to consider all

evidence relating to each of the statutory factors and may not draw adverse inferences that render such analysis

superfluous. “In general, the Commission makes determinations by weighing all of the available evidence regarding

a multiplicity of factors relating to the domestic industry as a whole and by drawing reasonable inferences from the

evidence it finds most persuasive.” SAA at 869.

 69 19 U.S.C. § 1675a(a)(4). 

13

producers/exporters.66 Consequently, the record contains significant data for the period of review from

the domestic industry and the foreign industry producing the subject merchandise. In addition, Affinia,

Federal-Mogul, and the Chinese Respondents Group submitted case briefs to the Commission. 

Accordingly, we rely on available information when appropriate, which consists primarily of information

from the original investigation, the first five-year review, and this second five-year review.67 68

B. Conditions of Competition and the Business Cycle

In evaluating the likely impact of the subject imports on the domestic industry, the statute directs

the Commission to consider all relevant economic factors “within the context of the business cycle and

conditions of competition that are distinctive to the affected industry.”69 Given the stable demand created

by the use for aftermarket brake rotors, we do not find that the aftermarket brake rotor market is

characterized by a regular and measurable business cycle that might be characteristic of other industries. 

The following conditions of competition are relevant to our determination.
 70 See Hearing Transcript at 45-48 (Vander Schaaf) and Original Investigation, Pub. 3036 at 4 and 8-9. 

 71 See Hearing Transcript at 46-48 (Vander Schaaf).

 72 CR at I-25 to I-29, PR at I-21 to I-23.

 73 Hearing transcript at 39-40 (Wappelhorst).

 74 CR at I-25 to I-29, PR at I-21 to I-23.

 75 CR at I-25 to I-29, PR at I-21 to I-23.

 76 Hearing Transcript at 15-16 (Hughes).

 77 Chinese Respondents Group Posthearing Brief at Q-10 to Q-11.

 78 Affinia Response to Notice of Institution at 29.

 79 Federal-Mogul Posthearing Brief at 32-33.

14

1. Product Characteristics

The market for aftermarket brake rotors stands in contrast to the market for OEM brake rotors.

OEM brake rotors are made for use in new motor vehicles. Because purchasers of new motor vehicles

may associate any defects in quality or performance of the brake rotors with the maker of the motor

vehicle, and because the brake rotors are often sold under warranty, OEM brake rotors are made to much

tighter tolerances than are aftermarket brake rotors.70 In contrast, aftermarket brake rotors are made to

looser tolerances and compete for sales as replacement parts when OEM brake rotors wear out.71 

Despite being made to looser tolerances than OEM brake rotors, the vast majority of aftermarket

brake rotors were of the premium grade at the time of the original investigation.72 These premium-grade

aftermarket brake rotors were of sufficient quality and thickness that upon becoming worn, they generally

continued in use after being resurfaced in a repair garage.73 Since the original investigation, the domestic

industry has devoted the vast majority of its domestic production to premium-grade aftermarket brake

rotors.74

While premium-grade product predominated at the time of the original investigation, economy

grade aftermarket brake rotors have gained growing acceptance over time. Compared to the premium

grade, economy-grade aftermarket brake rotors are lighter, thinner, and made to looser tolerances. In

contrast to economy grade, the production of premium-grade aftermarket brake rotors requires more

sophisticated and expensive production machinery and labor, and the castings for premium-grade rotors

are subject to more exacting quality control standards and testing.75 Upon wearing out, economy grade

rotors are seldom resurfaced, but are considered disposable and replaceable.76 Economy grade rotors now

make up about 80 percent of domestic sales, with premium grade product making up only 15 to 20

percent.77 While the bulk of sales has shifted to the economy grade, the domestic production remains

concentrated in the premium grade.

2. Demand

The demand for aftermarket brake rotors is determined by a number of factors, including the

number of vehicles in use, the average age of vehicles, and the average number of miles driven in a year.78

As noted, aftermarket brake rotors are available in both economy grade and premium grade. Despite the

higher cost of the premium-grade aftermarket brake rotors, there remain customers for whom their quality

and durability is worth the higher price, such as safety-conscious consumers, owners of high-end

automobiles, and fleet operators.79 Domestic producers note that demand for aftermarket brake rotors

since the original investigation has shifted substantially to economy-grade rotors and that, because of the

lower cost of this type of brake rotor, the market has shifted toward replacement of the rotor rather than
 80 Affinia Response to Notice of Institution at 29.

 81 Original Determination, USITC Pub. 3035 at 11-12.

 82 First Five-Year Review, USITC Pub. 3528 at 8.

 83 CR/PR at Table I-10. 

 84 See CR/PR at Table I-5 and Figure I-1.

 85 Seven of these firms were Brake Parts, Excel, Iroquois, ITT Automotive, Kinetic, Overseas Auto, and Wagner. 

The eighth firm, Airtex, ceased its minimal production of aftermarket brake rotors during 1993-95. A ninth firm,

AlliedSignal, produced a small amount of aftermarket rotors, but predominately manufactured OEM product. OEM

brake rotors were not part of the subject merchandise and were determined by the Commission at that time not to be

part of the domestic like product. The Commission ultimately excluded AlliedSignal from the domestic industry as a

related party in the original investigation.

 86 Federal-Mogul Prehearing Brief at 4.

 87 Original Determination, USITC Pub. 3035 at 18-19.

 88 Original Determination, USITC Pub. 3035 at 19.

 89 First Five-Year Review, USITC Pub. 3528 at 13.

15

resurfacing.80 Aftermarket brake rotors are generally sold to automotive parts distributors, retail outlets,

and end users. 

In the original investigation, the Commission found that U.S. demand for aftermarket brake rotors

had increased during the period of investigation and was likely to continue increasing due to the growing

number of vehicles on the road, the greater proportion of new automobiles with disc brakes on all four

wheels, and the decreased life span of OEM rotors. It also found that apparent domestic consumption of

aftermarket brake rotors, when measured by quantity, had increased 40.6 percent from 1993 to 1995,

while apparent consumption measured by value had increased 25.3 percent during the same period.81

In the first five-year review, based on facts available, the Commission estimated that apparent

U.S. consumption had increased since the original investigation and found that U.S. demand for

aftermarket brake rotors would continue to increase annually through 2005.82

In this second five-year review, U.S. apparent consumption increased *** percent over the period

of review, by quantity, from *** brake rotors in 2002 to *** brake rotors in 2007.83 

3. Supply

The domestic aftermarket brake rotor industry has undergone major restructuring since the

Commission’s original investigation. Bankruptcies, consolidations, reorganizations, and closures have

changed the composition of the domestic industry. Some domestic producers closed their operations

permanently, while others were initially acquired out of bankruptcy and continued to operate for a time. 

The major changes in the structure of the domestic industry from the original investigation to the present

review are detailed in the Report.84

In the original investigation, there were eight domestic producers of finished aftermarket brake

rotors.85 The largest U.S. producers produced their own castings in the United States and machined them

into finished aftermarket brake rotors.86 The Commission noted that U.S. producers’ production capacity

fluctuated, but increased overall.87 U.S. producers’ average capacity and production increased in the

beginning of the period of investigation, but declined in 1995.88

By the time of the first five-year review, only six known U.S. producers remained. The

Commission found that the domestic industry’s production decreased from 1995 to 2001 even though

U.S. demand had grown during the same period.89
 90 Hearing Transcript at 15 (Hughes).

 91 See Affinia Posthearing Brief at 9; E-mail from ***; and Coalition Response to Notice of Institution at 6.

 92 CR/PR at Table IV-7; E-mail from ***. A significant number of Chinese producers and exporters have zero or

de minimis cash deposit rates under the antidumping duty order on aftermarket brake rotors from China. See CR/PR

at Table I-2.

 93 CR/PR at Table I-1. Seven Chinese producer/exporter combinations were excluded from the antidumping duty

order on aftermarket brake rotors from China. See CR/PR at Table I-2, n.1.

 94 CR at III-24, PR at III-7. 

 95 CR at III-24, PR at III-7. The *** percent figure may be somewhat overstated given that some subject Chinese

producers did not respond to the Commission’s questionnaires.

 96 CR/PR at Table I-1. The U.S. producers’ share of U.S. apparent consumption, by value, declined over the

period of review from *** percent in 2002 to *** percent in 2007. Id.

 97 CR/PR at Table I-1. The Chinese subject producers’ share of U.S. apparent consumption, by value, increased

over the period of review from *** percent in 2002 to *** percent in 2007. Id. 

 98 CR/PR at Table I-1. The share of U.S. apparent consumption, by value, held by imports of nonsubject Chinese

aftermarket brake rotors fluctuated over the period of review, but increased overall from *** percent in 2002 to ***

percent in 2007. Id. 

 99 CR/PR at Table I-1. The share of U.S. apparent consumption, by value, held by imports of nonsubject

aftermarket brake rotors from other sources decreased from *** percent in 2002 to *** percent in 2007. Id.

 100 CR/PR at Table I-1. The share of U.S. apparent consumption, by value, of total imports of aftermarket brake

rotors from all sources increased from *** percent in 2002 to *** percent in 2007. Id.

 101 CR at V-14, PR at V-6; see also *** Questionnaire Response at III-2 and E-mail from ***. ***. Affinia

Posthearing Brief at 9 and Prehearing Brief at Exhibit 1 (Affinia 10-K Report).

16

 At the institution of this second five-year review, Affinia and Federal-Mogul were the only

remaining U.S. producers of the domestic like product. Since the institution, however, Federal-Mogul has

ceased domestic production of aftermarket brake rotors.90 Moreover, Affinia has announced that ***.91

According to foreign producer questionnaire responses submitted in this review, Chinese subject

economy-grade exports to the United States have increased over the period of review.92 Nonsubject

aftermarket brake rotors, both Chinese origin and from other sources, were a significant presence in the

U.S. market during the period of review.93 Notably, Affinia’s *** of subject imports, as a percentage of

total imports, accounted for *** percent of reported exports of subject merchandise from China in 2007,

and Federal-Mogul’s *** imports of subject rotors accounted for *** percent of subject exports in 2007.94

Both firms combined accounted for *** percent of reported exports of subject rotors to the United States

in 2007.95

The U.S. producers’ share of U.S. apparent consumption, by quantity, declined over the period of

review from *** percent in 2002 to *** percent in 2007.96 The subject Chinese producers’ share of U.S.

apparent consumption, by quantity, increased over the period of review from *** percent in 2002 to ***

percent in 2007.97 The share of U.S. apparent consumption, by quantity, held by imports of nonsubject

Chinese aftermarket brake rotors fluctuated over the period of review, but increased overall from ***

percent in 2002 to *** percent in 2007.98 The share of U.S. apparent consumption, by quantity, held by

imports of nonsubject aftermarket brake rotors from other sources decreased from *** percent in 2002 to

*** percent in 2007.99 The share of U.S. apparent consumption, by quantity, of total imports of

aftermarket brake rotors from all sources increased from *** percent in 2002 to *** percent in 2007.100

Available information indicates that imports of Chinese aftermarket brake rotors are

predominantly lower priced, economy-grade brake rotors, whereas U.S.-produced aftermarket brake

rotors are predominantly higher priced, premium-grade brake rotors.101
 102 CR at II-15, PR at II-10; and CR/PR at Table II-6.

 103 CR at II-9, PR at II-6.

 104 CR at I-28 and II-9, PR at I-23 and II-6.

 105 CR at I-25 to I-26, PR at I-21 to I-22.

 106 Federal-Mogul Posthearing Brief at 32-33.

 107 Hearing Transcript at 16 (Hughes).

 108 CR/PR at Table V-5.

 109 Chinese Respondents Group Posthearing Brief at Q-23.

 110 CR/PR at Figure V-1. Over the period January 2002 to March 2008, prices for ferrous scrap rose from $68.46

per gross ton to $329.33 per gross ton.

17

4. Substitutability

In this second five-year review, responses from U.S. producers, importers, and purchasers

indicate that aftermarket brake rotors from both subject and nonsubject sources are generally

interchangeable with aftermarket brake rotors produced in the United States.102 The degree of substitution

between domestic and imported aftermarket brake rotors depends, however, upon such factors as relative

prices, quality, and conditions of sale (e.g., availability, price discounts/rebates, delivery, payment terms,

product services, etc.).103 In particular, this degree of substitutability is limited by the grades of

aftermarket brake rotors available from the domestic producer and from Chinese suppliers. As noted,

aftermarket brake rotors are available in both premium grade and economy grade. Available information

shows that, while there is some overlap because both the domestic producer and Chinese suppliers offer

both grades, Chinese brake rotors are primarily economy grade whereas U.S.-produced rotors are

primarily premium grade.104 According to hearing testimony, there are differences in the production of

premium brake rotors and economy brake rotors that result in higher costs to manufacture premium brake

rotors.105 Federal-Mogul noted that, while there is some degree of interchangeability, each grade has a

unique product segment, with premium-grade brake rotors being sold to purchasers willing to pay the

substantially higher price, including safety-conscious users, owners of high-end vehicles, and operators of

motor vehicle fleet sales.106

According to hearing testimony, differences in production and production costs between

premium-grade and economy-grade aftermarket brake rotors have resulted in limited price competition

between the grades, with sales of the two types in different segments of the U.S. market to different

customers at different prices.107 The record shows significant differences in product pricing between

premium-grade and economy-grade aftermarket brake rotors.108 The Chinese Respondents Group claims

that premium-grade aftermarket brake rotors are priced *** to *** percent higher than economy-grade

brake rotors in the U.S. market.109 Although there is a low to moderate degree of substitution between the

subject imports and the domestic like product, we find that there are significant differences between the

subject economy-grade imports and the domestic premium-grade brake rotors.

5. Costs

The primary raw material used in the production of brake rotors is gray iron. Available data

indicate that while prices paid for ferrous scrap have fluctuated since 2002, they have increased

substantially during 2007.110 U.S. producers and all of the responding importers reported that raw
 111 CR/PR at V-1. *** also reported increased costs for transportation while *** reported increases in energy

costs. Id.

 112 19 U.S.C. § 1675a(a)(2).

 113 19 U.S.C. § 1675a(a)(2)(A)-(D).

 114 Original Determination, USITC Pub. 3035 at 16.

 115 Original Determination, USITC Pub. 3035 at 16.

 116 Original Determination, USITC Pub. 3035 at 25-26.

18

material costs have increased dramatically in 2007, both in the United States and in China, and they

expect this trend to continue as the Chinese economy grows.111

Based on the evidence in the record of this second five-year review, we find that conditions of

competition in the aftermarket brake rotor market are not likely to change significantly in the reasonably

foreseeable future. Accordingly, we find that current conditions in the market provide us with a

reasonable basis on which to assess the likely effects of revocation of the orders in the reasonably

foreseeable future.

C. Likely Volume of Subject Imports

In evaluating the likely volume of imports of subject merchandise if the antidumping duty order

were revoked, the Commission is directed to consider whether the likely volume of imports would be

significant either in absolute terms or relative to production or consumption in the United States.112 In

doing so, the Commission must consider “all relevant economic factors,” including four enumerated

factors: (1) any likely increase in production capacity or existing unused production capacity in the

exporting country; (2) existing inventories of the subject merchandise, or likely increases in inventories;

(3) the existence of barriers to the importation of the subject merchandise into countries other than the

United States; and (4) the potential for product shifting if production facilities in the foreign country,

which can be used to produce the subject merchandise, are currently being used to produce other

products.113

In the original investigation, the Commission found that the volume of subject brake rotor

imports, as measured by quantity and value, increased by 221.5 percent and 237.5 percent, respectively,

from 1993 to 1995. The Commission also found that the share of U.S. consumption, in terms of quantity,

held by subject imports increased from 8.0 percent in 1993 to 18.3 percent in 1995.114 The Commission

found that the increase in subject imports’ market share came at the expense of the domestic industry,

whose market share, in quantity terms, declined from 40.5 percent in 1993 to 35.0 percent in 1995.115

The Chinese aftermarket brake rotor industry’s production and production capacity

approximately doubled during the same period, while its capacity utilization declined from 93.0 percent

in 1993 to 85.4 percent in 1995. Aftermarket brake rotor exports increased in each year investigated, both

in absolute terms and as a percentage of total shipments, and the United States was the Chinese industry’s

primary export market.116 Finally, the Commission found that the Chinese aftermarket brake rotor

industry was one of China’s fastest growing industries, with expansion expected to continue through the

next decade.

In the first five-year review, the record contained no data on the volume of subject imports and

only limited data on the market share of the domestic industry since the original investigation. No

respondent interested party responded to the Commission’s notice of institution. Therefore, the

Commission made its conclusions with respect to the likely effects that revocation of the order would

have on the subject import volumes on the facts available, derived largely from the record of the original

investigation and from information submitted by Dana, Federal-Mogul, and Waupaca in the review.
 117 First Five-Year Review, USITC Pub. 3528 at 10.

 118 First Five-Year Review, USITC Pub. 3528 at 10-11.

 119 First Five-Year Review, USITC Pub. 3528 at 11.

 120 CR/PR at Table C-1.

 121 CR/PR at Table C-1.

 122 CR/PR at Table C-1.

 123 CR/PR at Tables IV-6 and IV-7. Chinese producers’ capacity increased from 13.7 million subject rotors in

2002 to 39.8 million subject rotors in 2007, and production increased from 9.1 million subject rotors in 2002 to 35.6

million subject rotors in 2007. CR/PR at Table IV-7.

 124 CR at IV-20, PR at IV-11. 

19

The Commission found that total imports of aftermarket brake rotors from China approximately

tripled since 1995, increasing from 6.4 million units in 1995 to 18.9 million units in 2001, although these

totals included brake rotor imports from both subject and nonsubject producers.117 The Commission

concluded that the data indicated that the imposition of the order in April 1997 did not appear to have

appreciably slowed the increase in overall imports from China, although data were not available to

indicate to what extent the increase was attributable to brake rotors that were not subject to the order.118

The Commission also found that the number of Chinese firms manufacturing brake rotors increased from

1999 to 2001, while capacity utilization declined. In sum, the Commission concluded that the likely

volume of subject imports would be significant absent the order, given the subject imports’ increases in

volume and market share, and the expansion and export orientation of the Chinese industry.119

In this second five-year review, the volume of subject brake rotor imports, as measured by

quantity and value, increased by 329.4 percent and 442.7 percent, respectively, from 2002 to 2007.120

The share of U.S. consumption, in terms of quantity, held by subject imports increased from *** percent

in 2002 to *** percent in 2007.121 The increase in market share for the subject imports came at the

expense of both the domestic industry and nonsubject imports, each of which declined in market share.122

While subject imports have achieved a substantial presence in the U.S. market even with the

discipline of the order, for the purposes of this review, we consider the significance of the volume of

subject imports in the context of the U.S. market conditions that are likely to prevail in the reasonably

foreseeable future. First, as noted above, the U.S. producers, ***, accounted for *** of the subject

imports – *** percent in 2007. Moreover, U.S. production and subject imports primarily serve different

market sectors, with most U.S. production directed to the premium sector and most subject imports

serving the economy sector. In addition, although subject imports of premium-grade aftermarket brake

rotors appear to have increased in 2007 over 2006, the information available to the Commission shows

that *** accounted for *** imports of subject premium-grade aftermarket brake rotors through direct

importation or purchase.

Although the Chinese aftermarket brake rotor industry’s production virtually quadrupled and its

capacity increased by 189.5 percent during the period of review, its capacity utilization also increased

from 66.3 percent in 2002 to 89.7 percent in 2007.123 Shipments of aftermarket brake rotors to the home

market by Chinese producers steadily increased from 2002 to 2006, although such shipments declined

considerably in 2007.124 While the Chinese industry is export-oriented and the United States is the
 125 CR/PR at Table IV-7. Chinese exports of subject rotors to the United States increased from 7.7 million rotors

in 2002 to 33.1 million rotors in 2007. Chinese end-of-period inventories fluctuated over the period of review, but

were higher at 744,000 subject rotors in 2007, up from 506,000 subject rotors in 2002. Id. Chinese inventory levels,

as a percentage of production, however, declined from 9.3 percent in 2005 to 2.1 percent in 2007. CR/PR at Table

IV-7.

 126 CR/PR at Tables IV-6 and IV-7. There were no trade barriers in countries other than the United States, and

none of the responding Chinese producers reported that they produced other products using the same equipment and

machinery or using the same production employees as in the production of aftermarket brake rotors. CR at IV-21,

PR at IV-12.

 127 CR at IV-21 to IV-22, PR at IV-12 to IV-13. The ability of producers in China to shift sales between the U.S.

market and alternative country markets may be moderated by existing relationships with current customers. Eleven

of the 13 responding producers in China reported in their foreign producer questionnaire responses that they have

long-term contracts or relationships with existing customers which make it difficult to shift sales of aftermarket

brake rotors between the U.S. market and alternative country markets. In addition, two Chinese producers noted that

it is difficult to shift sales between the U.S. market and alternative country markets due to the different rotor models

required in the different country markets (i.e., any particular aftermarket brake rotor model can only be sold in

countries where vehicles using that model are in use). Id. 

 128 CR/PR at Table I-9.

 129 CR/PR at Table I-10. The share of U.S. apparent consumption held by nonsubject Chinese imports of

aftermarket brake rotors, by value, increased from *** percent in 2002 to *** percent in 2007. Id.

 130 Seven Chinese exporter/producer combinations have never been subject to the antidumping duty order on

aftermarket brake rotors from China: China National Automotive Industry Import & Export Corp. and Shandong

Laizhou CAPCO Industry (“Laizhou CAPCO”); Laizhou CAPCO; Shenyang Honbase Machinery Co., Ltd.;

Shenyang and Laizhou Luyuan Automobile Fittings Co., Ltd.; Luyuan; Luyan and Shenyang; and China National

Machinery and Equipment Import & Export (Xinjiang) Corp., Ltd., and Zibo Botai Manufacturing Co. (“Zibo

Botai”). See Chinese Respondents Group Prehearing Brief at 32-33. Nonsubject producer Laizhou CAPCO

reportedly considers itself the largest producer of aftermarket brake rotors in China, with an annual casting capacity

of 40,000 tons. Id. at 32. *** reported annual production capacity of *** aftermarket brake rotors. ***.

 131 CR at V-14, PR at V-6; see also *** Questionnaire Response at III-2 and E-mail from ***.

20

Chinese industry’s primary export market,125 its excess capacity, as noted, has decreased.126 Finally, the

record indicates that the ability of Chinese producers to shift shipments to the U.S. market is limited due

to long-term contracts, existing customer relationships, differences in specifications, product mix, and

marketing in different country markets.127

Moreover, there have been substantial volumes of nonsubject aftermarket brake rotors from

China in the U.S. market during the period of review. Although imports of nonsubject aftermarket brake

rotors from China have fluctuated, the volume of nonsubject imports from China increased overall from

5.5 million rotors in 2002 to 13.5 million rotors in 2007.128 Notably, the share of U.S. apparent

consumption held by nonsubject Chinese imports of aftermarket brake rotors, by volume, increased from

*** percent in 2002 to *** percent in 2007.129 Thus, a substantial volume of nonsubject imports of

aftermarket brake rotors is likely to be present in the U.S. market in the reasonably foreseeable future

irrespective of the antidumping duty order.130

We thus find a number of mitigating factors with respect to the likely volume of subject imports

in the U.S. market in the absence of the order: (1) the domestic industry’s ***, accounted for *** of

subject imports in 2007; (2) the fact that the subject imports are predominantly economy-grade

aftermarket brake rotors, whereas the U.S. industry’s current and projected predominant product in the

U.S. market is premium-grade aftermarket brake rotors;131 (3) the high capacity utilization rates of the
 132 Affinia Posthearing Brief at 14-15. Affinia reported that it serves military contractors (i.e., Hummer

aftermarket brake rotors) whose “Buy American” policy requires continued domestic production. Id.

 133 19 U.S.C. § 1675a(a)(3). The SAA states that “[c]onsistent with its practice in investigations, in considering

the likely price effects of imports in the event of revocation and termination, the Commission may rely on

circumstantial, as well as direct, evidence of the adverse effects of unfairly traded imports on domestic prices.” SAA

at 886.

 134 Original Determination, USITC Pub. 3035 at 16-17.

 135 First Five-Year Review, USITC Pub. 3528 at 11-12.

 136 First Five-Year Review, USITC Pub. 3528 at 12.

 137 CR at V-16, PR at V-8.

 138 CR at V-16, PR at V-8.

21

Chinese producers and their limited excess capacity; (4) Affinia’s military “Buy American” sales;132 and

(5) the substantial volumes of nonsubject imports from China in the U.S. market throughout the period of

review.

For all of these reasons, and taking into consideration our findings above concerning the

conditions of competition that are distinctive to this industry, including the limited competition between 

economy-grade and premium-grade aftermarket brake rotor market segments in the U.S. market described

previously, we find that the likely volume of subject imports from China would not increase significantly

and its impact would be mitigated by the factors described above.

D. Likely Price Effects of Subject Imports

In evaluating the likely price effects of subject imports if the antidumping duty order were

revoked, the Commission is directed to consider whether there is likely to be significant underselling by

the subject imports as compared to the domestic like product and whether the subject imports are likely to

enter the United States at prices that otherwise would have a significant depressing or suppressing effect

on the price of the domestic like product.133

In the original investigation, the Commission found that the subject imports and domestically

produced aftermarket brake rotors competed on the basis of price. The Commission collected pricing data

on two domestically produced aftermarket brake rotor products and determined that the U.S. producers’

prices for both products had declined over the period of investigation, while prices for the subject imports

fluctuated irregularly over the same period. The Commission also found, however, that the subject

imports undersold the domestic aftermarket brake rotors by margins exceeding 20 percent in nearly every

quarterly pricing comparison during the period examined.134

In the first five-year review, the Commission found that the limited record in that expedited

review showed a decline in the average unit values for the subject imports even with the antidumping

duty order in place.135 In addition, the average unit values for U.S. commercial shipments of domestically

produced brake rotors declined over the period of review. The Commission concluded that, given the

price sensitivity of the U.S. market for aftermarket brake rotors, the subject imports would likely

significantly undersell the domestic like product to gain market share and have significant depressing or

suppressing effects on the domestic like product within a reasonably foreseeable time in the absence of

the orders.136

In this second five-year review, imports of subject economy-grade brake rotors continued to

undersell the domestically produced aftermarket brake rotors over the period of review even with the

antidumping duty order in place.137 Subject imports undersold domestic aftermarket brake rotors in all

possible quarterly comparisons for which data were collected for the review.138 Pricing information on

Chinese aftermarket brake rotors shows underselling on sales of products 1 through 4 in all 96 possible
 139 CR/PR at Tables V-1 through V-4.

 140 CR at V-16, PR at V-8.

 141 CR at V-14, PR at V-6; see also *** Questionnaire Response at III-2 and E-mail from ***.

 142 Available data indicates ***. Table Supplement A.

 143 CR/PR at Table V-5.

 144 CR/PR at Table I-9.

 145 We are cognizant that average unit values are affected by product mix. As noted, the vast majority of subject

aftermarket brake rotors imported during the period of review were of the economy grade, although a growing share

were premium grade, starting in 2006. CR at II-9, PR at II-6. Likewise, the vast majority of nonsubject aftermarket

brake rotors from China were also economy grade. CR at I-28, PR at I-23; Table Supplement A. Nevertheless, there

may be differences in product mix even within the economy grade.

 146 CR/PR at Table I-9. The average unit values for the domestic brake rotors fluctuated over the period, but were

*** lower at $*** per unit in 2007 than the $*** per unit reported for 2002. Id.

 147 CR/PR at Table I-9.

 148 CR at V-14, PR at V-6. Prices for domestic premium-grade aftermarket brake rotors were generally down for

Products 1, 2, and 4, but Product 3 demonstrated some increases. Prices of subject imports from China fluctuated

over the period, but generally declined. CR at V-16, PR at V-8. 

22

comparisons from 2002 through 2007.139 The margins of underselling range from 50.3 percent to 86.5

percent for the four selected products.140

While these data nominally indicate consistent underselling, the pricing data as reported did not

differentiate between premium-grade and economy-grade brake rotors for the specified products. As

noted above, subject imports during the period of review were principally economy-grade brake rotors

while domestically produced aftermarket brake rotors were principally premium-grade aftermarket brake

rotors, with limited competition between the grades in the U.S. market.141 The Commission has limited

data for U.S. prices of imported premium-grade aftermarket brake rotors.142 When the prices of subject

premium-grade aftermarket brake rotors are compared to domestically produced premium-grade

aftermarket brake rotors, however, the subject premium-grade brake rotors oversold the premium-grade

U.S. brake rotors in all 9 possible comparisons during the last three quarters of 2007, the only period for

which data were available.143

Although we lack data on prices for nonsubject imports, the average unit values for nonsubject

imports of aftermarket brake rotors from China were lower during the period of review than the average

unit values for both the subject imports from China and the domestically produced product.144 We

consider data for average unit values with caution,145 but examine them here in the absence of pricing data

for comparable products. The average unit values for nonsubject imports of aftermarket brake rotors from

China fluctuated over the period, but were higher at $7.45 per unit in 2007 than the $5.91 per unit

reported for 2002. The average unit values for subject imports of aftermarket brake rotors from China

fluctuated over the period, but were also higher at $8.58 per unit in 2007 than the $6.79 per unit reported

for 2002.146 Notably, the average unit values for nonsubject imports from China were lower than average

unit values for the subject imports from China in each year examined.147 These data and the limited

competition between the subject imports and domestic aftermarket brake rotors during the period of

review suggest that the subject imports have not had significant price suppressing or depressing effects

and are not likely to have such effects in the reasonably foreseeable future.

We have also considered movements in aftermarket brake rotor prices over the period examined. 

Prices of U.S.-produced premium-grade aftermarket brake rotors generally decreased for most products

over the period of review.148 Although domestic prices for premium-grade aftermarket brake rotors

generally declined over the period of review, there is no evidence of underselling of subject premium-
 149 CR/PR at Table V-5.

 150 ***.

 151 Table Supplement A.

 152 CR/PR at Table V-5.

 153 CR at V-14, PR at V-6. 

 154 CR/PR at Table C-1. Rising costs during the period of review are primarily attributed to the cost of raw

materials. Affinia Posthearing Brief at 11-12. 

 155 CR/PR at Table C-1.

 156 To the extent that imports of subject premium-grade brake rotors have increased in 2007, we again note that

Affinia is a significant purchaser of subject premium-grade aftermarket brake rotors ***. Table Supplement A.

 157 In various past investigations and reviews, respondents have argued that sales made by the domestic industry

under Buy American conditions were effectively shielded from competition with subject imports. Often, however,

we placed relatively little weight on Buy American sales, particularly where the domestic industry indicated that the

volume of such sales was small, and no other record evidence established the volume and importance of such sales. 

The circumstances are different in the current review. Here, the domestic industry is so small in relation to the

overall market that even a relatively limited volume of Buy American sales would represent a substantial market for

(continued...)

23

grade imports when compared to domestically produced premium-grade rotors.149 We do not find that

subject imports are likely to have significant price depressing effects if the order is revoked. As noted

above, subject imports are predominantly focused on the economy-grade segment of the U.S. market,

while the domestic industry is focused on the premium-grade segment ***.150 Further, the information

available to the Commission shows that Affinia accounted for *** in 2006 and 2007.151 Affinia would

have no incentive to *** that would adversely affect prices for its domestically produced aftermarket

brake rotors, and in fact all available comparisons show that subject premium-grade aftermarket brake

rotors oversold the domestic premium-grade aftermarket brake rotors.152

Despite some increases in price during the period of review,153 the domestic industry’s cost of

goods sold (“COGS”) as a share of net sales increased over the period of review from *** percent in 2002

to *** percent in 2007, indicating that any price increases did not keep pace with rising costs.154 Unit

COGS also increased from $*** per rotor in 2002 to $*** per rotor in 2007.155 Given the limited

competition between subject economy-grade imports and domestic premium-grade rotors and the absence

of underselling by the subject imports in the premium-grade segment of the U.S. market in 2006 and

2007, however, we do not attribute these unfavorable cost-price indicators in significant part to pricebased competition from the subject imports.

Based on the information available in this review, including the information from the original

investigation and the first five-year review, we find that the subject imports are unlikely to have

significant adverse price effects if the antidumping duty order is revoked, given the limited competition

between the subject imports and the domestically produced product and the significant presence of lowpriced, nonsubject imports of aftermarket brake rotors from China. Subject imports, which are primarily

economy-grade aftermarket brake rotors, would not likely gain market share by underselling the domestic

like product because demand in the U.S. market is primarily for economy-grade aftermarket brake rotors

and Affinia reportedly ***.156 With respect to U.S. demand for premium-grade aftermarket brake rotors,

the available data indicate that there is no underselling by the subject imports and that Affinia, the sole

remaining domestic producer, *** portion of premium-grade subject brake rotor imports from China. 

Therefore, the subject imports of premium-grade aftermarket brake rotors would not be likely to be sold

at competitive prices and, therefore, would not be likely to have significant depressing or suppressing

effects on prices of the domestic like product. Nor would subject imports be likely to have a significant

adverse effect on prices for aftermarket brake rotors sold under Buy American conditions.157
 157 (...continued)

its production. See CR/PR at Table C-1 (domestic industry representing a *** percent market share in 2007). 

Moreover, when responding to the assertion that it was likely to discontinue aftermarket brake rotor production in

the United States in the near future, Affinia itself cited its Buy American sales as evidence that it would continue

production. Affinia Posthearing brief at 13-15. Under these unusual circumstances, we give Buy American sales

more weight in this review than in other reviews, although we would have reached the same conclusion as to likely

price effects even in their absence.

 158 19 U.S.C. § 1675a(a)(4).

 159 19 U.S.C. § 1675a(a)(4). Section 752(a)(6) of the Act states that “the Commission may consider the

magnitude of the margin of dumping or the magnitude of the net countervailable subsidy” in making its

determination in a five-year review. 19 U.S.C. § 1675a(a)(6). The statute defines the “magnitude of the margin of

dumping” to be used by the Commission in five-year reviews as “the dumping margin or margins determined by the

administering authority under section 1675a(c)(3) of this title.” 19 U.S.C. § 1677(35)(C)(iv). See also SAA at 887.

Commerce expedited its sunset review of the antidumping duty order on brake rotors from China and found

that revocation would be likely to lead to continuation or recurrence of dumping. Commerce found dumping

margins of 8.51 percent for Hebei Metals and Minerals Import/Export Corporation, Shandong Jiuyang Enterprise

Corporation, Longjing Walking Tractor Works and Foreign Trade I/E, Jilin Provincial Machinery & Equipment I/E

Corporation, Qingdao Metals, Minerals, and Machinery Import & Export Corporation, Shanxi Machinery and

Equipment Import & Export Corporation, Xianghe Zichen Casting Co., Ltd., and Yenhere Corp.; a margin of 16.07

percent for Southwest Technical Import and Export Corporation; a margin of 3.56 percent for Yantai Import and

Export Corporation; and a 43.32 percent margin for the PRC-Wide Entity. Brake Rotors from the People’s Republic

of China: Notice of Final Results of Expedited Second Sunset Review of Antidumping Duty Order, 73 Fed. Reg. at

1321.

 160 19 U.S.C. § 1675a(a)(1)(C). The SAA states that in assessing whether the domestic industry is vulnerable to

injury if the order is revoked, the Commission “considers, in addition to imports, other factors that may be

contributing to overall injury. While these factors, in some cases, may account for the injury to the domestic

industry, they may also demonstrate that an industry is facing difficulties from a variety of sources and is vulnerable

to dumped or subsidized imports.” SAA at 885.

24

Given the likely small volume of additional subject imports from China in the event of revocation

and taking into consideration our findings above concerning the conditions of competition that are

distinctive to this industry, we find that revocation of the antidumping duty order on the subject

imports of aftermarket brake rotors from China would not be likely to lead to significant underselling or

significant price depression or suppression within a reasonably foreseeable time.

E. Likely Impact of Subject Imports

In evaluating the likely impact of imports of subject merchandise if the antidumping duty order

were revoked, the Commission is directed to consider all relevant economic factors that are likely to have

a bearing on the state of the industry in the United States, including, but not limited to, the following: (1)

likely declines in output, sales, market share, profits, productivity, return on investments, and utilization

of capacity; (2) likely negative effects on cash flow, inventories, employment, wages, growth, ability to

raise capital, and investment; and (3) likely negative effects on the existing development and production

efforts of the industry, including efforts to develop a derivative or more advanced version of the domestic

like product.158 All relevant economic factors are to be considered within the context of the business

cycle and the conditions of competition that are distinctive to the industry.159 As instructed by the statute,

we have considered the extent to which any improvement in the state of the domestic industry is related to

the order at issue and whether the industry is vulnerable to material injury if the order is revoked.160

In the original investigation, the Commission found that the domestic industry’s production and

shipments increased over the period of investigation, but that these increases were commensurate with

growth in the U.S. market for aftermarket brake rotors. The Commission also found that the dumped
 161 Original Investigation, USITC Pub. 3035 at 18.

 162 First Five-Year Review, USITC Pub. 3528 at 13.

 163 First Five-Year Review, USITC Pub. 3528 at 14.

 164 CR/PR at Table C-1.

 165 See CR/PR at Table I-1. The U.S. industry’s market share in terms of U.S. apparent consumption decreased

*** overall during the period, from *** percent in 2002 to *** percent in 2007.

 166 CR/PR at Table I-1. The industry’s capacity utilization decreased from *** percent in 2001 to *** percent in

2007. Id. Total capacity also decreased from *** rotors in 2002 to *** rotors in 2007. Id.

 167 CR/PR at Table III-8. The industry’s productivity declined *** over the period of review from *** rotors per

hour in 2002 to *** rotors per hour in 2007. CR/PR at Table I-1; CR/PR at Table III-7. *** research and

development expenses. Capital expenditures were ***. CR/PR at Table III-11.

 168 CR/PR at Table III-9.

 169 19 U.S.C. §1675a(a)(1)(c). See also SAA at 885.

 170 E-mail from *** and Coalition Response to Notice of Institution at 6.

 171 E-mail from ***. ***. Id. See also Federal-Mogul Final Comments at 1.

25

subject imports captured market share at the expense of the domestic industry and prevented the domestic

industry from attaining the full benefit of its increased capacity. Finally, the Commission found that the

price suppressing and depressing effects of the surging dumped subject imports caused the domestic

industry’s profit margin and operating income to decline *** during the period investigated, despite

increases in the industry’s sales revenue.161

In the first five-year review, despite the limited information available concerning the condition of

the domestic industry, the Commission estimated that the domestic industry’s production decreased

during the period of review, even as U.S. demand increased during the same period.162 Although the

Commission could not conclude, based on the limited record, that the domestic industry was vulnerable to

material injury if the order were revoked, it found that underselling by the subject imports continued

concurrent with an increase in the volume of subject imports during the period of review. The

Commission further found that these conditions would only worsen in the absence of the order. 

Accordingly, the Commission concluded that revocation of the order would be likely to have a significant

impact on the domestic industry within a reasonably foreseeable time.163

In this second five-year review, the domestic industry demonstrated that its revenues, shipments,

and sales declined over the period of review.164 The domestic industry’s market share declined

throughout the period.165 Its capacity utilization also declined during the period, as Affinia restructured

and Federal-Mogul ceased aftermarket brake rotor production.166 Employment in the industry declined

over the period of review from *** workers in 2002 to *** workers in 2007, and wages trended

downward over the majority of the period.167 The U.S. industry reported *** declining operating income

margins from 2002 through 2007.168 Given these unfavorable indicators, we find that the domestic

industry is in a vulnerable state.169 As described above, while the domestic industry has devoted the vast

majority of its production to premium-grade aftermarket brake rotors, the market for that product has

declined substantially as many consumers now prefer the economy grade. As its market declined, the

domestic industry declined along with it.

Notwithstanding the domestic industry’s vulnerable state, Affinia currently produces ***.170 As

we found above, competition in the U.S. market between these products and the subject imports likely

will be limited. Moreover, even with the antidumping duty order in place, the domestic producers, ***,

have accounted for *** of the subject imports, particularly ***, and Affinia ***,171 has made *** research

and development investments during the period of review, and has made *** capital expenditures during
 172 CR/PR at Table III-11. *** research and development expenses. Although brake rotor production is highly

capital intensive, Affinia’s capital expenditures were *** over the period of review and were *** for 2006 and 2007. 

Id.

26

that same period.172 Therefore, despite the domestic industry’s vulnerable state, we find that subject

imports are not likely to adversely impact the U.S. aftermarket brake rotor industry if the antidumping

duty order were revoked. 

We have found above that the revocation of the antidumping duty order would not likely lead to

either significant additional volumes of subject imports or significant price effects given the limited

competition between the subject imports and the domestically produced product and other factors,

described above, that mitigate the impact of subject import volumes on the U.S. industry. These findings

in turn indicate that the subject imports are not likely to have a significant adverse impact on the domestic

industry in the reasonably foreseeable future if the antidumping order is revoked.

 

CONCLUSION

For the foregoing reasons, we determine that revocation of the antidumping duty order on

aftermarket brake rotors from China would not be likely to lead to continuation or recurrence of material

injury to an industry in the United States within a reasonably foreseeable time.
 1

 19 U.S.C. 1675(c).

 2

 The terms “aftermarket brake rotors,” “brake rotors,” “certain brake rotors,” “aftermarket rotors,” and “rotors”

used in this report all refer to the aftermarket brake rotors as described in Commerce’s scope of the subject

merchandise, unless otherwise specified.

 3 72 FR 36037, July 2, 2007. All interested parties were requested to respond to this notice by submitting the

information requested by the Commission. The Commission’s notice of institution is presented in app. A.

 4

 In accordance with section 751(c) of the Act, the U.S. Department of Commerce (“Commerce”) published a

notice of initiation of a five-year review of the subject antidumping duty order concurrently with the Commission’s

notice of institution. 72 FR 35968, July 2, 2007.

 5

 On August 21, 2007, the Commission received one domestic interested party submission in response to its

notice of institution for the subject review. It was filed on behalf of the Coalition for the Preservation of American

Brake Drum and Rotor Aftermarket Manufacturers (“Coalition”), which was, at that time, an unincorporated

association of two domestic producers of brake rotors, Federal-Mogul, Inc. (“Federal-Mogul”) and Affinia Group,

Inc. (“Affinia”). The Coalition, represented by the law firm of Porter, Wright, Morris and Arthur, LLC, indicated in

its response to the Commission’s notice of institution in this review that its then members, Affinia and FederalMogul, were the only U.S. producers of the domestic like product at that time. Response of Coalition, August 21,

2007, pp. 20 and 21. The membership of the Coalition changed after it submitted its response to the Commission’s

notice of institution. On January 11, 2008, the law firm of Mayer Brown LLP filed an entry of appearance with the

Commission on behalf of Federal-Mogul and, on February 8, 2008, the Commission was notified that Federal-Mogul

had withdrawn from the Coalition. Letter to The Honorable Marilyn R. Abbott from Mayer Brown LLP, January 11,

2008; Letter to Marilyn R. Abbott from Porter, Wright, Morris and Arthur, LLC, February 8, 2008.

 6

 The Commission received one Chinese interested party submission in response to its notice of institution for the

subject review. It was filed by counsel Bryan Cave LLP on behalf of the following firms: Qingdao Meita

Automotive Industry Co., Ltd. (“Qingdao Meita”); Longkou Jinzheng Machinery Co., Ltd. (“Longkou Jinzheng”);

Longkou Haimeng Machinery Co., Ltd. (“Longkou Haimeng”); Longkou TLC Machinery Co., Ltd. (“Longkou

TLC”); Laizhou Hongda Auto Replacement Parts Co., Ltd. (“Laizhou Hongda”); World Known Precision Industry

(Fuzhou) Co., Ltd. (“Fuzhou”); Shandong Huanri Group Co., Ltd. (“Shandong Huanri”); Shanxi Zhongding Auto

Parts Co., Ltd. (“Zhongdin”); Laizhou Wally Automobile Co., Ltd. (“Laizhou Wally”); Laizhou City Luqi

Machinery Co., Ltd. (“Laizhou City Luqi”); Yantai Winhere Auto-Part Manufacturing Co., Ltd. (“Yantai Winhere”);

Qingdao Gren (Group) Co. (“Qingdao Gren”); CWD, LLC dba Centric Parts (“CWD”); Gren Automotive, Inc.

(“Gren Automotive”); IAP West, Inc. (“IAP”); Qualis Automotive LLC (“Qualis”); Best Brakes; and Ziway, Inc.

(“Ziway”) (collectively referred to herein as “Chinese respondents”). Chinese respondents Qingdao Meita, Longkou

Jinzheng, Longkou Haimeng, Longkou TLC, Laizhou Hongda, Fuzhou, Shandong Huanri, Zhongdin, Laizhou

Wally, Laizhou City Luqi, Yantai Winhere, and Qingdao Gren are Chinese producers and/or exporters of the subject

merchandise, which in the aggregate, accounted for the majority of the total volume of exports of subject

merchandise to the United States in 2006. Chinese respondents CWD, Gren Automotive, and Ziway are U.S.

importers of subject merchandise from China and Best Brakes, IAP, and Qualis are purchasers and/or consignees for

(continued...)

I-1

PART I: INTRODUCTION AND OVERVIEW

BACKGROUND

On July 2, 2007, the U.S. International Trade Commission (“Commission” or “USITC”) gave

notice, pursuant to section 751(c) of the Tariff Act of 1930, as amended (“the Act”),1

 that it had instituted

a review to determine whether revocation of the antidumping duty order on aftermarket brake rotors2

 from

China would likely lead to the continuation or recurrence of material injury to a domestic 

industry.3 4

 On October 5, 2007, the Commission found that the domestic interested party group response

to its notice of institution was adequate5

 and that the respondent interested party group response with

respect to China was adequate.6

 Accordingly, the Commission unanimously determined that it would
 6

 (...continued)

imports by others of subject merchandise from China. Response of Chinese respondents, August 21, 2007, pp. 2 and

7, and exhs. 2 and 3; and Supplemental Response of Chinese respondents, September 5, 2007, pp. 2 and 3.

 7

 72 FR 59111, October 18, 2007. The Commission’s notice to conduct a full review appears in app. A.

 8

 The Commission’s notice of institution, notice to conduct a full review, scheduling notice, and statement on

adequacy appear in app. A and may also be found at the Commission’s web site (internet address www.usitc.gov). 

Commissioners’ votes on whether to conduct an expedited or full review may also be found at the web site. 

Commerce’s notice of final results of its expedited review also appears in app. A. The list of witnesses that appeared

at the Commission’s hearing is presented in App. B. No witnesses appeared at the Commission’s hearing in support

of the continuation of the antidumping duty order. Counsel for the Coalition (i.e., Affinia) filed a letter advising the

Commission that “due to various financial and personnel limitations” it would not be filing a prehearing brief nor

would it be present to provide testimony at the Commission’s hearing. Letter from Leslie Alan Glick, Porter Wright

Morris & Arthur LLP, April 3, 2008.

 9

 The members of the Coalition at that time were Brake Parts, Inc. (“Brake Parts”); Kinetic Parts Manufacturing

Inc. (“Kinetic”); Iroquois Tool Systems, Inc. (“Iroquois”); and Wagner Brake Corp. (“Wagner”). Certain Brake

Drums and Rotors From China: Investigation No. 731-TA-744 (Final), USITC Publication 3035, April 1997, p. I-1.

 10 Commerce also made a determination that “critical circumstances” existed with respect to all companies subject

to the China-wide rate for brake rotors. 62 FR 9160, February 28, 1997.

 11 The Commission also made a negative determination regarding critical circumstances with respect to subject

rotors. The original investigation concerned both brake drums and rotors from China; however, the Commission

determined that an industry in the United States was not materially injured or threatened with material injury, and the

(continued...)

I-2

conduct a full review with respect to brake rotors from China pursuant to section 751(c)(5) of the Act.7

Selected information relating to the schedule of the current five-year review is presented below:8

Effective date Action

July 2, 2007 Commission’s institution of second five-year review (72 FR 36037)

July 2, 2007 Commerce’s initiation of second five-year review (72 FR 35968)

October 5, 2007 Commission’s determination to conduct a full review (72 FR 59111, October 18, 2007)

November 19, 2007 Commission’s scheduling of the review (72 FR 66187, November 27, 2007)

January 8, 2008 Commerce’s final results of expedited five-year review (73 FR 1319)

April 15, 2008 Commission’s hearing

May 29, 2008 Date of the Commission’s vote

June 11, 2008 Commission’s determination transmitted to Commerce 

The Original Investigation and the Expedited First Five-Year Review

The original investigation resulted from a petition filed on March 7, 1996, by counsel on behalf

of the Coalition.9

 On February 28, 1997, Commerce made a final affirmative determination of sales at

less than fair value (“LTFV”) with respect to brake rotors from China.10 The Commission completed the

original investigation in April 1997, determining that an industry in the United States was materially

injured by reason of imports of brake rotors from China that Commerce determined to be sold at LTFV.11
 11 (...continued)

establishment of an industry in the United States was not materially retarded, by reason of imports from China of

certain brake drums that had been found by Commerce to be sold in the United States at LTFV. Certain Brake

Drums and Rotors From China: Investigation No. 731-TA-744 (Final), USITC Publication 3035, April 1997, p. 1.

 12 Excluded from the antidumping duty order were the following seven exporter and producer combinations: 

(1) exporter China National Automotive Industry Import & Export Corp. and producer Shandong Laizhou CAPCO

Industry (“CAPCO”), (2) exporter and producer CAPCO, (3) exporter and producer Shenyang Honbase Machinery

Co., Ltd. (“Shenyang Honbase”), (4) exporter Shenyang Honbase and producer Laizhou Luyuan Automobile Fittings

Co., Ltd. (“Laizhou Luyuan”), (5) exporter and producer Laizhou Luyuan, (6) exporter Laizhou Luyuan and

producer Shenyang Honbase, and (7) exporter China National Machinery and Equipment I&E (Xinjiang) Corp., Ltd.

and producer Zibo Botai Manufacturing Co., Ltd. (“Zibo Botai”). 62 FR 9160, February 28, 1997; 62 FR 15655,

April 2, 1997; 62 FR 18740, April 17, 1997; and Issues and Decision Memorandum for the Final Results in the

Expedited Second Sunset Review of the Antidumping Duty Order on Brake Rotors from the People’s Republic of

China, International Trade Administration, Department of Commerce, December 31, 2007, pp. 2-3.

 13 67 FR 9462, March 1, 2002.

 14 The Commission received one submission in response to its notice of institution for the subject review. It was

filed on behalf of the Coalition, whose membership at that time was comprised of the following three domestic

producers: Dana Corp., Brake and Chassis Division (“Dana”), Federal-Mogul, and Waupaca Foundry, Inc.

(“Waupaca”). The members of the coalition were together believed to represent from *** to *** percent of total

U.S. production of aftermarket brake rotors in 2001. The Commission did not receive any responses to its notice of

institution from respondent interested parties with respect to China during the first review. In the first five-year

review, the Commission determined that the domestic interested party responses to its notice of institution were

adequate and that the respondent interested party responses were inadequate. It found no other circumstances that

would warrant conducting a full review. Staff Report, June 28, 2002 (INV-Z-099), p. I-3.

 15 67 FR 45458, July 9, 2002.

 16 67 FR 50459, August 2, 2002; Brake Rotors from China: Investigation No. 731-TA-744 (Review), USITC

Publication 3528, July 2002, p. 1.

 17 67 FR 52933, August 14, 2002.

I-3

After receipt of the Commission’s determination, Commerce issued an antidumping duty order on imports

of brake rotors from China.12

On March 1, 2002, the Commission instituted the first five-year review of the antidumping duty

order13 and, on June 4, 2002, the Commission determined that it would proceed to an expedited review.14

On July 9, 2002, Commerce found that revocation of the antidumping duty order on brake rotors from

China would likely lead to continuation or recurrence of dumping.15 In July 2002, the Commission

completed its expedited first five-year review of the subject order and determined that revocation of the

order on brake rotors from China would be likely to lead to continuation or recurrence of material injury

to an industry in the United States within a reasonably foreseeable time.16 Subsequently, Commerce

issued a continuation of the subject antidumping duty order.17
 18 Because of the paucity of data available in the Commission’s expedited first five-year review, data from the

Commission’s 421 investigation are presented instead for calendar years 1998-2001. 

 19 The Commission’s questionnaires in this current five-year review requested data for calendar years 2002-07. 

Unless otherwise noted, all references to the “review period” in this report are for this period of time for which data

were collected.

 20 The membership of the Coalition at that time consisted of Dana, Federal-Mogul, and Waupaca.

 21 19 U.S.C. § 2451(b).

 22 68 FR 35702, June 16, 2003.

 23 The scope definition of aftermarket brake rotors examined in the section 421 investigation is the same as the

scope in the current review. Ibid.

 24 68 FR 48938, August 15, 2003.

 25 Also consistent with its previous findings, the Commission found that domestic original equipment manufactrer

(“OEM”) brake drums and rotors were not like or directly competitive with the imported subject Chinese product

and that there was a clear dividing line between OEM brake drums and rotors and aftermarket brake drums and

rotors. OEM brake drums and rotors were not included in the scope of the investigations and there were no known

imports of the OEM product from China during the period examined in the section 421 investigation. Certain Brake

Drums and Rotors From China: Investigation No. TA-421-3, USITC Publication 3622, August 2003, pp. 7-14; and

Brake Rotors From China: Investigation No. 731-TA-744 (Review), USITC Publication 3528, July 2002, pp. 4-6. 

The Chinese respondents in this current review indicated that the facts concerning OEM and aftermarket brake rotors

remain the same today. Posthearing brief of Chinese respondents, pp. Q-6-Q-7.

I-4

Summary Data

Table I-1 presents a summary of data from the original investigation, the Section 421

investigation (for further information, see section entitled “Related Investigation” that follows),18 and the

current (second) full five-year review.19

RELATED INVESTIGATION

Following receipt of a petition, as amended, on June 6, 2003, on behalf of the Coalition,20 the

Commission instituted investigation No. TA-421-3, Certain Brake Drums and Rotors from China, under

section 421(b) of the Trade Act of 1974.21 22 The Commission completed its section 421 investigation in

August 2003, finding that certain (aftermarket) brake drums and certain (aftermarket) brake rotors23 from

China were not being imported into the United States in such increased quantities or under such

conditions as to cause or threaten to cause market disruption to the domestic producers of like or directly

competitive products.24 Consistent with its previous findings in the underlying Title VII investigation and

first five-year review concerning the antidumping duty order on Brake Rotors From China, the

Commission found that aftermarket brake drums and aftermarket brake rotors were two distinct like or

directly competitive products and that there were two separate domestic industries consisting of the U.S.

producers of aftermarket brake drums and the U.S. producers of aftermarket brake rotors.25
Table I-1

Brake rotors: Summary data from the original investigation, the Section 421 investigation,1 and the current (second) full five-ye

1998-2007

(Quantity=1,000 units; value=1,000 dollars; unit values, unit labor costs, and unit financial data are per unit)

Item 1993 1994 1995 1998 1999 2000 2001 2002 2003 2004 2

U.S. consumption quantity: Amount 19,909 25,209 27,998 *** *** *** *** *** *** ***  Producers’ share2 40.5 37.1 35.0 *** *** *** *** *** *** *** 

 Importer’s share:2

 China (subject) 8.0 16.0 18.3 (3) (3) (3) (3) *** *** *** 

 China (nonsubject) 3.2 4.4 4.6 (3) (3) (3) (3) *** *** ***  Total, China 11.2 20.4 22.9 *** *** *** *** *** *** ***  Other countries 48.2 42.5 42.1 *** *** *** *** *** *** ***  Total imports 59.5 62.9 65.0 *** *** *** *** *** *** *** U.S. consumption value: Amount 268,286 317,973 336,166 *** *** *** *** *** *** ***  Producers’ share2 48.0 46.7 45.8 *** *** *** *** *** *** *** 

 Importer’s share:2

 China (subject) 4.2 9.2 11.3 (3) (3) (3) (3) *** *** *** 

 China (nonsubject) 1.6 2.3 2.8 (3) (3) (3) (3) *** *** ***  Total, China 5.8 11.5 14.2 *** *** *** *** *** *** ***  Other countries 46.2 41.7 40.0 *** *** *** *** *** *** ***  Total imports 52.0 53.3 54.2 *** *** *** *** *** *** *** 

Table continued on following page.

I-5
Table I-1--Continued

Brake rotors: Summary data from the original investigation, the Section 421 investigation,1 and the current (second) full five-ye

1998-2007

(Quantity=1,000 units; value=1,000 dollars; unit values, unit labor costs, and unit financial data are per unit)

Item 1993 1994 1995 1998 1999 2000 2001 2002 2003 2004 2

U.S. imports from-- China (subject):  Quantity 1,594 4,025 5,125 (3) (3) (3) (3) 7,703 12,882 14,961 

 Value 11,277 29,232 38,057 (3) (3) (3) (3) 52,315 93,412 117,655 1 Unit value $7.07 $7.26 $7.43 (3) (3) (3) (3) $6.79 $7.25 $7.86  Ending inventory quantity 739 1,159 1,366 (3) (3) (3) (3) 694 1,271 1,447  China (nonsubject): Quantity 641 1,107 1,282 (3) (3) (3) (2) 5,549 6,951 3,809  Value 4,237 7,446 9,556 (3) (3) (3) (2) 32,822 44,162 26,952  Unit value $6.61 $6.73 $7.45 (3) (3) (3) (3) $5.91 $6.35 $7.08  Ending inventory quantity 51 125 51 (3) (3) (3) (3) *** *** ***  Total, China: Quantity 2,235 5,132 6,407 11,202 16,440 20,569 23,322 13,252 19,833 18,770  Value 15,513 36,677 47,613 75,334 107,673 138,905 148,698 85,137 137,574 144,607 1 Unit value $6.94 $7.15 $7.43 $6.73 $6.55 $6.75 $6.38 $6.42 $6.94 $7.70  Ending inventory quantity 790 1,284 1,417 *** *** *** *** *** *** ***  All other countries: Quantity 9,608 10,719 11,791 10,601 12,129 11,318 11,166 42,300 38,075 32,259  Value 123,903 132,864 134,528 112,925 135,554 146,174 138,649 592,580 565,743 523,590 4 Unit value $12.90 $12.40 $11.41 $10.65 $11.18 $12.92 $12.42 $14.01 $14.86 $16.23  Ending inventory quantity (3) (3) (3) *** *** *** *** 197 283 379 

Table continued on following page.

I-6
Table I-1--Continued

Brake rotors: Summary data from the original investigation, the Section 421 investigation,1 and the current (second) full five-ye

1998-2007

(Quantity=1,000 units; value=1,000 dollars; unit values, unit labor costs, and unit financial data are per unit)

Item 1993 1994 1995 1998 1999 2000 2001 2002 2003 2004 2

U.S. imports from-- All countries:  Quantity 11,843 15,851 18,198 21,803 28,569 31,888 34,488 55,551 57,908 51,030  Value 139,416 169,541 182,141 188,259 243,227 285,079 287,347 677,717 703,317 668,197 6 Unit value $11.77 $10.70 $10.01 $8.63 $8.51 $8.94 $8.33 $12.20 $12.15 $13.09  Ending inventory quantity (3) (3) (3) *** *** *** *** *** *** *** 

U.S. producers’-- Capacity quantity 9,514 12,416 13,005 *** *** *** *** *** *** ***  Production quantity 9,159 10,905 10,726 *** *** *** *** *** *** ***  Capacity utilization2 96.3 87.8 82.5 *** *** *** *** *** *** *** 

 U.S. shipments: Quantity 8,066 9,358 9,800 *** *** *** *** *** *** ***  Value 128,870 148,432 154,025 *** *** *** *** *** *** ***  Unit value $15.98 $15.86 $15.72 *** *** *** *** *** *** ***  Export shipments: Quantity 979 783 734 *** *** *** *** *** *** ***  Value 15,858 11,692 10,890 *** *** *** *** *** *** ***  Unit value $16.20 $14.93 $14.84 *** *** *** *** *** *** ***  Ending inventory quantity 1,319 1,762 2,227 *** *** *** *** *** *** ***  Inventories/total shipments2 14.6 17.4 21.1 *** *** *** *** *** *** *** 

Table continued on following page.

I-7
Table I-1--Continued

Brake rotors: Summary data from the original investigation, the Section 421 investigation,1 and the current (second) full five-ye

1998-2007

(Quantity=1,000 units; value=1,000 dollars; unit values, unit labor costs, and unit financial data are per unit)

Item 1993 1994 1995 1998 1999 2000 2001 2002 2003 2004 2

U.S. producers’-- Production workers 814 934 931 *** *** *** *** *** *** ***  Hours worked (1,000 hours) 1,728 1,976 1,938 *** *** *** *** *** *** ***  Wages paid (1,000 dollars) 24,081 26,812 26,775 *** *** *** *** *** *** ***  Hourly wages $13.94 $13.57 $13.82 *** *** *** *** *** *** ***  Productivity (units/hr) 5.3 5.5 5.5 *** *** *** *** *** *** ***  Unit labor costs $2.63 $2.46 $2.50 *** *** *** *** *** *** ***  Net sales: Quantity 9,483 10,730 11,373 *** *** *** *** *** *** ***  Value 152,459 169,965 182,086 *** *** *** *** *** *** ***  Unit value $16.08 $15.84 $16.01 *** *** *** *** *** *** ***  Cost of goods sold (“COGS”) 110,593 130,807 139,611 *** *** *** *** *** *** ***  Gross profit or (loss) 41,866 39,158 42,475 *** *** *** *** *** *** ***  SG&A expenses 28,563 30,651 32,631 *** *** *** *** *** *** ***  Operating income or (loss) 13,303 8,507 9,844 *** *** *** *** *** *** ***  Capital expenditures 4,178 8,493 2,513 *** *** *** *** *** *** ***  Unit COGS $11.66 $12.19 $12.28 *** *** *** *** *** *** ***  Unit SG&A expenses $3.01 $2.86 $2.87 *** *** *** *** *** *** ***  Unit operating income or (loss) $1.40 $0.79 $0.87 *** *** *** *** *** *** *** 

Table continued on following page.

I-8
Table I-1--Continued

Brake rotors: Summary data from the original investigation, the Section 421 investigation,1 and the current (second) full five-ye

1998-2007

(Quantity=1,000 units; value=1,000 dollars; unit values, unit labor costs, and unit financial data are per unit)

Item 1993 1994 1995 1998 1999 2000 2001 2002 2003 2004 2

U.S. producers’-- COGS/sales2 72.5 77.0 76.7 *** *** *** *** *** *** *** 

 Operating income or (loss)/sales2 8.7 5.0 5.4 *** *** *** *** *** *** *** 

1 Because of the paucity of data available in the Commission’s expedited first five-year review, data from the Commission’s 421 investigation are presented instead for calendar years 

presented in the Commission’s 421 investigation for 1998-2001 are derived official Commerce statistics and were adjusted by staff, whereas import data presented for the current review 

questionnaires for “China (subject)” and from unadjusted official Commerce statistics for “China (nonsubject)” and “all other countries.”

2 In percent.3 Not applicable or not available.

Source: Staff Report, March 18, 1997 (INV-U-020), tables III-4, III-6, III-7, IV-1, IV-4, C-2 (as revised on March 27, 1997 (INV-U-030)), for 1993-95 data; Staff Report, July 29, 2003 (INV-

and C-2, for 1998-2001 data. Data for 2002-07 were compiled in response to Commission questionnaires and from official Commerce statistics.

I-9
I-10

STATUTORY CRITERIA AND ORGANIZATION OF THE REPORT

Statutory Criteria

Section 751(c) of the Act requires Commerce and the Commission to conduct a review no later

than five years after the issuance of an antidumping or countervailing duty order or the suspension of an

investigation to determine whether revocation of the order or termination of the suspended investigation

“would be likely to lead to continuation or recurrence of dumping or a countervailable subsidy (as the

case may be) and of material injury.” 

Section 752(a) of the Act provides that in making its determination of likelihood of continuation

or recurrence of material injury–

(1) IN GENERAL.-- . . . the Commission shall determine whether revocation of

an order, or termination of a suspended investigation, would be likely to lead to

continuation or recurrence of material injury within a reasonably foreseeable time. The

Commission shall consider the likely volume, price effect, and impact of imports of the

subject merchandise on the industry if the order is revoked or the suspended investigation

is terminated. The Commission shall take into account--

(A) its prior injury determinations, including the volume, price

effect, and impact of imports of the subject merchandise on the industry

before the order was issued or the suspension agreement was accepted, 

(B) whether any improvement in the state of the industry is

related to the order or the suspension agreement, 

(C) whether the industry is vulnerable to material injury if the

order is revoked or the suspension agreement is terminated, and 

(D) in an antidumping proceeding . . ., (Commerce’s findings)

regarding duty absorption . . .

(2) VOLUME.--In evaluating the likely volume of imports of the subject

merchandise if the order is revoked or the suspended investigation is terminated, the

Commission shall consider whether the likely volume of imports of the subject

merchandise would be significant if the order is revoked or the suspended investigation is

terminated, either in absolute terms or relative to production or consumption in the

United States. In so doing, the Commission shall consider all relevant economic factors,

including--

(A) any likely increase in production capacity or existing unused

production capacity in the exporting country, 

(B) existing inventories of the subject merchandise, or likely

increases in inventories, 

(C) the existence of barriers to the importation of such

merchandise into countries other than the United States, and 

(D) the potential for product-shifting if production facilities in

the foreign country, which can be used to produce the subject

merchandise, are currently being used to produce other products.
 26 In addition, Waupaca, a domestic foundry that produces raw castings for a variety of products, including

aftermarket brake rotors, provided a response to the Commission’s producer questionnaire in this review. Also,

Power Performance Group (“PPG”) (aka Power Slot)/StopTech, a specialized finisher for the “high performance”

rotor market, provided a producer questionnaire response. CWD acquired StopTech in April 2006 and Power

Performance Group (aka Power Slot) in October 2007. Information provided by Waupaca and CWD are presented

separately throughout this report, where appropriate. As discussed in greater detail later in this report, the parties to

this review have argued that foundries and producers of specialized rotors for the “high performance” market are not

part of the domestic industry in this review.

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(3) PRICE.--In evaluating the likely price effects of imports of the subject

merchandise if the order is revoked or the suspended investigation is terminated, the

Commission shall consider whether–

(A) there is likely to be significant price underselling by imports

of the subject merchandise as compared to domestic like products, and 

(B) imports of the subject merchandise are likely to enter the

United States at prices that otherwise would have a significant

depressing or suppressing effect on the price of domestic like products.

(4) IMPACT ON THE INDUSTRY.--In evaluating the likely impact of imports of

the subject merchandise on the industry if the order is revoked or the suspended

investigation is terminated, the Commission shall consider all relevant economic factors

which are likely to have a bearing on the state of the industry in the United States,

including, but not limited to--

(A) likely declines in output, sales, market share, profits,

productivity, return on investments, and utilization of capacity, 

(B) likely negative effects on cash flow, inventories, employment,

wages, growth, ability to raise capital, and investment, and 

(C) likely negative effects on the existing development and

production efforts of the industry, including efforts to develop a

derivative or more advanced version of the domestic like product.

The Commission shall evaluate all such relevant economic factors . . . within the context

of the business cycle and the conditions of competition that are distinctive to the affected

industry.

Section 752(a)(6) of the Act states further that in making its determination, “the Commission may

consider the magnitude of the margin of dumping or the magnitude of the net countervailable subsidy.”

Organization of the Report

Information obtained during the course of the review that relates to the statutory criteria is

presented throughout this report. A summary of trade and financial data for the aftermarket brake rotor

markets as collected in the review is presented in appendix C at table C-1. U.S. industry data are based

on the questionnaire responses of two U.S. producers that were reported by parties to this review to have

accounted for all domestic production of aftermarket brake rotors in 2007.26 Because of the relatively
 27 The Commission received questionnaire responses from 21 U.S. importers of aftermarket brake rotors. Based

on official Commerce statistics for imports of brake rotors, importers’ questionnaire data accounted for 36.3 percent

of total U.S. imports during 2007 and 57.5 percent of total imports from China in 2007. The coverage figures are

somewhat understated to the extent that official Commerce statistics include merchandise that falls outside the

definition of aftermarket brake rotors (e.g., OEM brake rotors). Based on export data provided in foreign producer

questionnaire responses, the subject import data obtained through importer questionnaires accounted for 67.6 percent

of reported exports of subject merchandise to the United States from China in 2007. The subject import data

presented in the body of this report are understated to the extent that some Chinese producers subject to the

antidumping duty order did not respond to the Commission’s questionnaire.

 28 The HTS statistical reporting number specific to rotors was created in July 2004; however, this narrower HTS

category is still a broader product grouping than the subject merchandise in that it includes OEM brake rotors and

other rotors that fall outside the defined physical parameters. Prior to July 2004, the HTS number also included

brake drums. Therefore, the nonsubject import data presented in the body of this report are overstated to the extent

that the official statistics include merchandise that does not meet Commerce’s scope description of aftermarket brake

rotors. Regardless, the Coalition indicated in its response to the Commission’s notice of institution in this review

that it believes that the large majority of imports entering the United States under this HTS number are for

aftermarket rotors because, until recently, OEMs would generally not buy rotors produced in China. Response of

Coalition, August 21, 2007, p. 8.

 29 The 2007 coverage figure presented is somewhat understated. As noted previously, the HTS category under

which the subject merchandise is categorized for 2007 is a broader product grouping, including OEM brake rotors

and other rotors that fall outside the defined physical parameters.

 30 For previously reviewed or investigated companies not included in an administrative review, the cash deposit

rate continues to be the company-specific rate published for the most recent period.

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low response rate by U.S. importers to the Commission’s questionnaire, the quantity of exports to the

United States as reported in foreign producer questionnaire responses is used as a proxy for the subject

import quantity data presented in the body of this report; the import value data presented for the subject

merchandise were constructed using the unit value data provided in the U.S. importer questionnaire

responses.27 Import data presented for nonsubject rotors are based on official Commerce statistics.28

Official Commerce import statistics are also presented in their entirety separately in appendix C at table

C-2. Foreign industry data and related information are based on the questionnaire responses of 13 subject

producers of aftermarket brake rotors in China. Based on official Commerce statistics for U.S. imports of

brake rotors, as adjusted to exclude fairly traded rotors from China, these Chinese producers’ exports to

the United States accounted for at least 73.6 percent of total U.S. imports of subject brake rotors from

China.29 Responses by U.S. producers, importers, purchasers, and foreign producers of aftermarket brake

rotors to a series of questions concerning the significance of the existing antidumping duty order and the

likely effects of revocation are presented in appendix D.

COMMERCE’S REVIEWS

Since the issuance of the antidumping duty order on brake rotors from China, Commerce has

completed nine administrative reviews, three changed circumstance reviews, 15 new shipper reviews, and

two five-year reviews. The results of these reviews are presented in table I-2.30 Commerce is currently

conducting the 2006-07 administrative review in conjunction with the 16th new shipper review.
 31 On February 5, 2008, Commerce published the preliminary results of its 2006-07 administrative review of the

order. Commerce preliminarily determined that the following 14 Chinese companies received zero-percent margins: 

Qingdao Meita; Laizhou Auto Brake Equipment Co., Ltd. (“Laizhou Auto Brake”); Yantai Winhere; Laizhou

Hongda; Laizhou City Luqi; Laizhou Wally; Zibo Luzhou Automobile Parts Co., Ltd. (“Zibo Luzhou”); Zibo

Golden Harvest Machinery Ltd. Co. (“Zibo Golden Harvest”); Longkou TLC; Longkou Jinzheng; Qingdao Gren;

Shenyang Yinghao Machinery Co. (“Shenyang Yinghao”); Longkou Dixion Brake System Ltd. (“Dixion Brake”);

and Shanghai Tylon Co., Ltd. (new shipper review margin). In addition, a fifteenth Chinese firm, Longkou

Haimeng, preliminarily received a 0.03 percent (de minimis) margin. The China-wide rate was 43.32 percent. 73

FR 6700, February 5, 2008.

 32 In its scope ruling, Commerce found that brake rotors produced by Federal-Mogul in China that include the

Ford-Motocraft logo in the casting and certified by the Ford Motor Co. are not within the scope of the antidumping

duty order. 72 FR 23802, May 1, 2007.

 33 Letter to Mr. Robert Carpenter from Wendy J. Frankel, Office Director, AD/CVD Operations, Office 8, Import

Administration, U.S. Department of Commerce, August 21, 2007.

 34 73 FR 1319, January 8, 2008. Commerce’s final results of its expedited review are presented in app. A.

 35 Commerce explained that it “normally . . . will select a margin from the final determination in the investigation

because that is the only calculated rate that reflects the behavior of exporters without the discipline of an order or

suspension agreement in place.” Commerce also explained that although it has completed nine administrative

reviews and multiple new shipper reviews since the issuance of the antidumping duty order, it does not find any

indication that the margins calculated in the administrative reviews or new shipper reviews are more probative of the

behavior of manufacturers, producers, and exporters without the discipline of the order. Issues and Decision

Memorandum for the Final Results of the Expedited Second Sunset Review of the Antidumping Duty Order on Brake

Rotors from the People’s Republic of China, International Trade Administration, Department of Commerce,

December 31, 2007, pp. 15-16. 

 36 Section 754 of the Tariff Act of 1930, as amended (19 U.S.C. § 1675(c)).

 37 19 CFR 159.64 (g).

I-13

Commerce indicated that it will issue its final results no later than June 4, 2008.31 Commerce has not

conducted any duty-absorption investigations with respect to this order; however, one scope ruling has

been issued by Commerce with respect to brake rotors from China.32

On August 21, 2007, Commerce notified the Commission that it was conducting an expedited

review with respect to brake rotors from China because it did not receive an adequate substantive

response to its notice of initiation from the respondent interested parties.33 It published the final results of

its review based on the facts available on January 8, 2008.34 In its final results, Commerce found that

revocation of the antidumping duty order on brake rotors from China would likely lead to continuation or

recurrence of dumping at margins determined in its original final determination (see table I-2).35

DISTRIBUTION OF CONTINUED DUMPING AND SUBSIDY OFFSET ACT FUNDS

The Continued Dumping and Subsidy Offset Act of 2000 (“CDSOA”) (also known as the Byrd

Amendment) provides that assessed duties received pursuant to antidumping or countervailing duty

orders must be distributed to affected domestic producers for certain qualifying expenditures that these

producers incur after the issuance of such orders.36 During the review period, qualified U.S. producers of

brake rotors were eligible to receive disbursements from the U.S. Customs and Border Protection

(“Customs”) under CDSOA relating to the antidumping duty order on the subject product beginning in

Federal fiscal year 2001.37 Table I-3 presents CDSOA disbursements and claims for Federal fiscal years

(October 1-September 30) 2001-07 by firm.
Table I-2

Brake rotors: Commerce’s reviews of the antidumping duty order

Firm 04/971 03/99 11/99 10/00 05/01 08/01 07/022 08/02 10/02 05/03 08/03 07/04 08/04 11/05 01/06 11/06 China National Industrial MachineryImport & Export Corp. 0.00 0.084 0.174 0.284 8.90 

Dixion Brake 8.15Hebei Metals and Minerals Import &Export 8.51 8.512 

Hongfa Machinery (Dalian) Co., Ltd. 0.00 0.00 0.00 0.00 13.59Jilin Provincial Machinery & EquipmentImport & Export Corp. 8.51 0.00 0.00 8.512 Laizhou Automobile Brake EquipmentCo.5 0.00 0.00 0.224 0.014 0.094 8.90 

Laizhou City Luqi 0.00 8.90 Laizhou Hongda 0.00 0.00 0.00 0.044 8.90 Laizhou Wally 0.00Longjing Walking Tractor WorksForeign Trade import & Export Corp. 8.51 0.00 8.512 

Longkou Haimeng 0.00 0.104 0.054 0.014 0.204 5.29 

Longkou Jinzheng 0.00 Table continued on next page.

I-14
Table I-2–Continued

Brake rotors: Commerce’s reviews of the antidumping duty order

Firm 04/971 03/99 11/99 10/00 05/01 08/01 07/022 08/02 10/02 05/03 08/03 07/04 08/04 11/05 01/06 11/06 

Longkou Qizheng Auto Parts Co. Longkou TLC 0.00 0.024 0.104 8.90 

Qingdao Golrich Autoparts Co. Qingdao Gren Co. 0.00 0.69 0.024 0.064 0.044 0.324 8.90 Qingdao Meita 0.00 0.094 0.144 0.00 0.034 

Qingdao Metals, Minerals & MachineryImports & Exports 8.51 8.512 

Shandong Huanri 0.00 0.00 Shandong Jiuyang Enterprise Corp. 8.51 0.00 8.512 Shandong Laizhou Huanri GroupGeneral Co. 0.00Shanxi Fengkun Foundry Ltd. 1.43Shanxi Fengkun Metallurgical Ltd. Co. 0.00 1.43 8.90Shanxi Machinery and EquipmentImport & Export 8.51 8.512 Shanxi Zhonding Auto Parts Shenyang Yinghao 0.00 8.90 Southwest Technical Import & Export,Yangtze Machinery Corp, MMBInternational 16.07 16.072 Xiangfen Hengtai Brake System Co.,Ltd. 0.00 0.00 43.32Xianghe Xumingyuan Auto Parts Co.,Ltd. 0.00Table continued on next page.

I-15
Table I-2–Continued

Brake rotors: Commerce’s reviews of the antidumping duty order Firm 04/971 03/99 11/99 10/00 05/01 08/01 07/022 08/02 10/02 05/03 08/03 07/04 08/04 11/05 01/06 11/06 Xianghe Zichen Casting Co., Ltd. 8.51 0.00 8.512 Yantai Import & Export Corp. 3.56 0.00 0.064 3.562 Yantai Winhere 0.00 0.00 0.00 0.024 0.314 0.014 Yenhere Corp. 8.51 0.00 0.00 8.512 Zibo Botai 0.00Zibo Golden Harvest 0.00 0.00 8.90 Zibo Luzhou 0.00 0.144 0.00 0.174 8.90 

China-wide rate 43.32 43.322 

1 Antidumping duty order, as amended. Excluded from the antidumping duty order were the following seven exporter and producer combinations: (1) exporter China National Automotive In

producer Shandong Laizhou CAPCO Industry (“CAPCO”), (2) exporter and producer CAPCO, (3) exporter and producer Shenyang Honbase Machinery Co., Ltd. (“Shenyang Honbase”), (4) ex

producer Laizhou Luyuan Automobile Fittings Co., Ltd. (“Laizhou Luyuan”), (5) exporter and producer Laizhou Luyuan, (6) exporter Laizhou Luyuan and producer Shenyang Honbase, and (7) Machinery and Equipment I&E (Xinjiang) Corp., Ltd. and producer Zibo Botai Manufacturing Co., Ltd. (“Zibo Botai”). 

2 Final results of first expedited five-year review.3 Final results of second expedited five-year review.4 De minimis.5 Successor in interest to Laizhou Auto Brake Equipment Factory. 66 FR 37211, July 17, 2001.

Note 1.–The shaded columns indicate new shipper reviews.Note 2.–On February 5, 2008, Commerce published the preliminary results of its 2006-07 administrative review of the order (73 FR 6700, February 5, 2008). Commerce preliminarily determin

companies received zero-percent margins: Qingdao Meita; Laizhou Auto Brake; Yantai Winhere; Laizhou Hongda; Laizhou City Luqi; Laizhou Wally; Zibo Luzhou; Zibo Golden Harvest; Longk

Qingdao Gren; Shenyang Yinghao; Dixion Brake; and Shanghai Tylon Co., Ltd. (new shipper review margin). In addition, a fifteenth Chinese firm, Longkou Haimeng, preliminarily received a 0

Commerce indicated that it will issue its final results no later than June 4, 2008.Source: Antidumping duty order, 62 FR 18740, April 17, 1997; 64 FR 9972, March 1, 1999 (review period 4/1/97 - 9/30/97); 64 FR 61581, November 12, 1999 (review period 10/10/96 - 3/31/92000 (review period 4/1/98 - 3/31/99); 66 FR 27063, May 16, 2001 (review period 4/1/99 - 3/31/00); 66 FR 44331, August 23, 2001 (review period 4/1/00 - 9/30/00); final results of first expediteJuly 9, 2002; 67 FR 53913, August 20, 2002 (review period 4/1/01 - 9/30/01); 67 FR 65779, October 28,2002 (review period 4/1/00 - 3/31/01); 68 FR 25861, May 14, 2003 (review period 4/1/0

21, 2003 (review period 4/1/02 - 9/30/02); 69 FR 42039, July 13, 2004 (review period 4/1/02 - 3/31/03); 69 FR 52228, August 25, 2004 (review period 4/1/03 - 9/30/03); 70 FR 69937, Novembe

3/31/04); 71 FR 4112, January 25, 2006 (review period 4/1/04 - 9/30/04); 71 FR 66304, November 14, 2006 (review period 4/1/04 - 3/31/05); 72 FR 42386, August 2, 2007 (review period 4/1/0

November 28, 2007 (review period 4/1/06 - 10/31/06); and final results of second expedited sunset review, 73 FR 1319, January 8, 2008.

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I-17

Table I-3

Brake rotors: CDSOA disbursements, by firm, and total claims, Federal fiscal years 2001-07

Item

Federal fiscal year

2001 2002 2003 2004 2005 2006 2007

Disbursements (dollars)

Brake Parts1 607,059 2,252,166 0 0 172,533 57,050 0

Federal-Mogul 0 0 0 0 38,000 0 0

Kelsey Hayes2 0 844,903 47,7780000

Wagner Brake3 107,478 1,165,86900000

 Total 714,538 4,262,938 47,778 0 210,532 57,050 0

Claims (1,000 dollars)

 Total 847,121 433,996 84,179 0 1,741,260 1,601,510 0

 1 Affinia is the successor firm to Brake Parts.

 2

 Kelsey Hayes was the legal corporate umbrella for TRW Automotive, whose successor firm is PowerStop. 

PowerStop is no longer a domestic producer of “commodity” aftermarket brake rotors. It produces specialized

rotors for the “high performance” market.

 3

 Federal-Mogul is the successor firm to Wagner Brake.

Source: U.S. Customs and Border Protection’s CDSOA Annual Reports. Retrieved from

www.cbp.gov/xp/cgov/import/add_cvd.

THE SUBJECT MERCHANDISE

Commerce’s Scope

The imported product subject to the antidumping duty order under review, as defined by

Commerce in its original and continuation orders, is

. . . brake rotors made of gray cast iron, whether finished, semifinished, or unfinished, ranging in

diameter from 8 to 16 inches (20.32 to 40.64 centimeters) and in weight from 8 to 45 pounds

(3.63 to 20.41 kilograms). The size parameters (weight and dimension) of the brake rotors limit

their use to the following types of motor vehicles: automobiles, all-terrain vehicles, vans and

recreational vehicles under “one ton and a half,” and light trucks designated as “one ton and a

half.” Finished brake rotors are those that are ready for sale and installation without any further

operations. Semi-finished rotors are those on which the surface is not entirely smooth, and have

undergone some drilling. Unfinished rotors are those which have undergone some grinding or

turning. These brake rotors are for motor vehicles, and do not contain in the casting a logo of an

original equipment manufacturer (“OEM”) which produces vehicles sold in the United States

(e.g., General Motors, Ford, Chrysler, Honda, Toyota, Volvo). Brake rotors covered in the order

are not certified by OEM producers of vehicles sold in the United States. The scope also includes

composite brake rotors that are made of gray cast iron, which contain a steel plate, but otherwise

meet the above criteria. Excluded from the scope of the order are brake rotors made of gray cast

iron, whether finished, semifinished, or unfinished, with a diameter less than 8 inches or greater

than 16 inches (less than 20.32 centimeters or greater than 40.64 centimeters) and a weight less
 38 67 FR 52933, August 14, 2002.

 39 ***.

 40 ***.

 41 Posthearing brief of Chinese respondents, pp. Q-24-Q-25. 

 42 The Coalition indicated in its response to the Commission’s notice of institution in this review that it believes

that the large majority of imports entering the United States under this HTS number are for aftermarket rotors

because, until recently, OEMs would generally not buy rotors produced in China. Response of Coalition, August 21,

2007, p. 8.

 43 Presidential Proclamation 8097 of Dec. 27, 2006 (72 FR 453), implementing provisions set forth in USITC

Publication 3898, effective February 3, 2007.

I-18

than 8 pounds or greater than 45 pounds (less than 3.63 kilograms or greater than 20.41

kilograms).38

As is clearly apparent from Commerce’s definition, OEM brake rotors are specifically excluded

and brake drums are not covered by the scope. In addition, evidence on the record in this current review

indicates that raw castings for aftermarket brake rotors are also not covered in Commerce’s definition of

the scope of the subject merchandise.39 In fact, various industry participants indicated that they believe

that raw castings for aftermarket brake rotors are simply not imported from China.40 Although it is not

clear whether or not specialized aftermarket brake rotors for the “high performance” industry are covered

by Commerce’s scope language, the Chinese respondents in this review indicated that these products,

which require advanced metallurgy and much higher quality standards, are not imported from China

because the Chinese producers are not capable of producing the highly specialized rotors for the “high

performance” market.41

Tariff Treatment

The subject merchandise is currently imported under statistical reporting number 8708.30.5030 of

the HTS at the column 1-general duty rate of 2.5 percent ad valorem, applicable to China.

 Prior to July 2004, aftermarket brake rotors were imported into the United States under HTS

statistical reporting number 8708.39.5010, a category that included not only the subject merchandise, but

also merchandise that was outside Commerce’s scope (e.g., OEM brake rotors, aftermarket and OEM

brake drums; products not of gray cast iron (namely, aluminum); and products which do not meet the

scope’s specified size parameters (including such parts for use in larger-sized vehicles)). Further, this

provision included castings, unfinished, and semifinished products that were shipped into the United

States for final processing, provided they were identifiable as parts of brakes at entry. The HTS statistical

reporting number specific to rotors, HTS 8708.39.5030 (brake rotors (discs) for motor vehicles), was

created in July 2004. This HTS category included both aftermarket and OEM brake rotors for motor

vehicles (other than agricultural tractors) of headings 8701 to 8705, which was a broader product

grouping than the subject merchandise.42 With the HTS nomenclature revision in 2007,43 U.S. imports of

the subject brake rotors are currently classified in HTS subheading 8708.30.50 (statistical reporting

number 8708.30.5030).
 44 Staff Report, March 18, 1997 (INV-U-020), pp. I-4-I-12, II-1, and V-1-V-4.

 45 Brake rotors can be and have also been manufactured from aluminum. The advantage of an aluminum brake

rotor lies in its light weight.

 46 Staff Report, March 18, 1997 (INV-U-020), pp. I-4-I-12, II-1, and V-1-V-4.

 47 The Coalition submitted that “[t]he highest investment in the brake industry relates to pollution control - which

burdens U.S. producers much more than Chinese producers that have lower environmental standards.” Response of

Coalition, August 21, 2007, p. 9.

 48 There is no standard industry concept of the terms “unfinished” and “semifinished” brake rotors. These

products are not traded in significant quantities, and are not suitable for any other use.

 49 Staff Report, March 18, 1997 (INV-U-020), pp. I-4-I-12, II-1, and V-1-V-4.

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THE PRODUCT

Description and Uses

Brake rotors are part of disc brake assemblies, commonly used on front-wheel-drive vehicles,

where braking action is created by two brake pads squeezing a rotor. The rotor is a circular rotational

component attached to the wheel hub. A hydraulic caliper and disc brake pads are mounted on an adapter

that straddles the rotor. When the brake pedal is applied, hydraulic pressure at the wheel cylinder 

increases, which allows the hydraulic caliper to force the braking pads against the rotating disc in a 

clamping action to slow or stop the vehicle.44

Manufacturing Process

Brake rotors are generally produced from gray iron,45 which has high wear resistance, excellent

machinability, a relatively high coefficient of friction, and vibration absorption. This metal is also easily

cast into rather complex shapes at a relatively low cost. The casting process involves pouring liquid metal

into a mold of the final product and allowing the metal to solidify.46 The Coalition indicated in its

response to the Commission’s notice of institution in this current review that

{r}otors are produced by casting, which does not require significant investment or technology at

production level - an ideal scenario for the Chinese industry that emphasizes labor-intensive

industries over technology-intensive industries.47 

After the raw casting is formed, the article undergoes machining, such as grinding and drilling, to

reach the finished product. Unfinished brake rotors have undergone some grinding but are not functional

as brake system products. Semifinished brake rotors have also undergone initial grinding and have been

drilled or pierced. Such parts still require additional finish grinding and boring to be considered

serviceable.48 Finished brake rotors are ready for installation and meet fit and function criteria. Specific

rotors have individual design and functional characteristics that limit their use to specific models of motor

vehicles.49 The Chinese producers indicated in their responses to the Commission’s questionnaire in this

review that there have been no significant changes in the production technology since the time of the

original investigation.

Testimony at the Commission’s conference in the preliminary phase of the original investigation

indicated that aftermarket brake rotors usually appear as replacements within 2 years after the
 50 Ibid., p. I-8.

 51 Hearing transcript, pp. 118-119 (Fudalla).

 52 Staff Report, March 18, 1997 (INV-U-020), p. I-8.

 53 The ultimate customer is usually unaware of the origin of the brake rotor when it is installed at a retail brake

outlet. Staff Report, March 18, 1997 (INV-U-020), p. I-10.

 54 Universal’s Form 10-K for FY 2001, p. 2.

 55 Companies such as Pep Boys, Carquest, AutoZone, and Firestone. Hearing transcript, p. 47 (Fudalla). 

I-20

introduction of new motor vehicle platforms and the corresponding change in brake rotor models.50

However, testimony at the hearing held in connection with the current five-year review suggests that

currently the interval is considerably shorter. Mr. Marvin Fudalla, President and CEO of Qualis

Automotive LLC, a U.S. purchaser of aftermarket brake rotors imported from China, testified that his

customers request that aftermarket brake rotors be available six months after the introduction of a new

motor vehicle.51 During that interval, aftermarket producers reverse-engineer the new brake rotor models

and complete the retooling necessary for production. As a result, the availability of aftermarket products

generally coincides with the initial demand for replacement parts for the originally installed OEM brake

rotors.52

Channels of Distribution and Marketing Considerations

The aftermarket for brake rotors is characterized by several layers of distribution between the

producer and the final consumer. The system had traditionally been dominated by two main distribution

channels, namely (1) professional service outlets consisting of warehouse distributors, jobbers, and

service station/independent garages and (2) retail outlets. Aftermarket parts sold through warehouse

distributors were first supplied to jobbers who then wholesaled the parts to service stations and garages

that installed the subject brake rotors. Retail outlets such as automotive supply chains sold brake rotors

for installation by the consumer.53 The distinctions between the channels, however, had diminished by

the time of the original investigation. Further, as stated in the 2001 10-K form of a U.S. producer of

brake rotors (Universal), “(w}e believe that in recent years there has been an industry shift away from the

traditional channels of distribution toward alternative distribution channels, including manufacturers who

sell parts to mass market retailers who serve do-it-yourself customers, and manufacturers who sell parts to

warehouse distributors, who sell directly to installers that provide repair and installation service.”54 

Inventories are held throughout the distribution chain, with frequent deliveries required.

Many warehouse distributors55 and jobbers have banded together under a common promotional

banner called Program Distribution Groups (“PDGs”). PDGs receive price proposals from producers and

importers and then certify manufacturers as approved vendors based on price criteria, at which point

member companies can make individual arrangements to purchase from any of the approved vendors at

the group price. Buying groups serve a similar function for independent retail outlets that purchase large

quantities at discount prices.

U.S. firms manufacturing brake rotors for the aftermarket generally sell to warehouse distributors,

retail brake service outlets, and large automotive supply chains. The subject imported products were

reported during the original investigation to enter the U.S. market at the warehouse distributor level,

where U.S. manufacturers and importing “agents” competed for sales among PDGs and buying groups. 

Once approved by these groups, the imported products were marketed in the same professional service

and retail outlets as domestic aftermarket parts.

A producer or importer may sell under different labels and some firms have arrangements with

different distribution chains to produce parts under the chains’ labels. Sometimes a U.S. producer or
 56 Hearing transcript, p. 14 (Hughes).

 57 Ibid., p. 37 (Wappelhorst).

 58 Ibid., p. 16 (Hughes).

 59 Ibid.

 60 Ibid., p. 67 (Hughes).

 61 Ibid., p. 66 (Hughes).

 62 Ibid., p. 123 (Wappelhorst).

I-21

importer will carry two product lines. The large number of different models required makes it difficult

for one manufacturer to produce every model. As a result, co-manufacturing arrangements exist, and

there is trade among producers and importers. In addition, unfinished and semifinished Chinese brake

rotors are purchased from distributors by U.S. aftermarket manufacturers for finishing and then marketed

through the U.S. manufacturers’ distribution chain.

Information collected in response to Commission questionnaires in the current review

summarizing the commercial channels of distribution for domestic and imported aftermarket brake rotors

is presented in table I-4. As the data indicate, *** U.S. commercial shipments of finished aftermarket

brake rotors made by domestic producers Affinia and Federal-Mogul were made to auto parts distributors

and *** U.S. commercial shipments of aftermarket brake rotors made by U.S. importers were made to

distributors. Of the 21 responding U.S. importers of record, 13 reported that they were also the consignee

for the merchandise that they imported and 7 reported that they took title to the goods.

According to hearing testimony, brake rotors have recently become “more disposable and it has

become easier and less costly to replace the brake rotors rather than to resurface them.” In addition, brake

rotors today are “a lot thinner and have essentially become discardable, throw-away parts.”56 This trend is

attributable, in part, to “[e]ngineering advances and reductions in vehicle weight {that} have increased

demand for lighter, thinner rotors versus the heavier, thicker rotors.”57

Table I-4

Brake rotors: Channels of distribution for domestic product and U.S. imports sold in the U.S.

market, 2002-07

* * * * * * *

Premium and Economy Aftermarket Brake Rotors

According to hearing testimony, the production of premium aftermarket brake rotors requires

“very sophisticated and expensive machinery and extra labor.”58 Economy-grade rotors, on the other

hand, are produced using “a very unsophisticated process.”59 In addition, not only are premium rotors

subject to greater quality control than economy rotors,60 they also are “produced by manufacturers that

have extensive equipment to manufacture high quality rotors and they do have metallurgy tests where

they actually take a proof out of every single batch and they use a gas spectrometer to test the

metallurgy,” unlike economy rotors.61 Premium rotors are typically produced on a “very expensive

automated line, and that’s always going to require a much higher price. Plus, the machining portion of

the premium rotor also is much more refined in the balancing at significant costs” than that of the

economy rotor.62

Information on the record in this review indicates that there are differences between premium and

economy rotors in terms of raw castings and finished tolerances. Federal-Mogul stated that for the
 63 Ibid., p. 67 (Wappelhorst).

 64 Ibid., p. 48 (Wappelhorst).

 65 Posthearing brief of Chinese respondents, pp. Q-10-Q-11.

 66 Ibid., pp. Q-11 and Q-23.

 67 Response of Coalition, August 21, 2007, pp. 5-6.

 68 Posthearing brief of Chinese respondents, p. Q-11.

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economy-grade rotors, it accepts a wider range of chemistry, a lower tensile strength, and a wider range of

hardness than for the premium-grade rotors.63 Moreover, Federal-Mogul indicated that 

[w]hen we machine those braking surfaces we are always much finer and a lot closer

tolerance on the braking surface for the premium as compared to the economy. The

castings we used were better as far as from a balance standpoint on the premium, so you

would expect better life from that. Also, from the better braking surface you would

expect better life not only from the rotor itself but from the friction pad that rides on the

part.64 

The Chinese respondents claimed in their posthearing brief that the premium rotors represented

roughly 80 percent of the rotors sold in the U.S. market at the time of the original investigation, but that

this share dropped to its current range of 15-20 percent.65 They argued that currently all U.S. production

of aftermarket brake rotors constitutes premium product, whereas the Chinese products are primarily

economy-grade rotors.66 In their response to the Commission’s notice of institution in this review, the

Coalition stated the following concerning the domestic and Chinese premium and economy lines of

aftermarket brake rotors:

The Chinese industry produces premium and economy lines of rotors. The premium line

tends to be more focused on trucks, APVs, SUVs and premium passenger cars

applications. The economy line concentrates on high volume applications. However,

there is cross competition between the two lines - many applications have an economy

and a premium rotor available. For example, Aimco 55036 rotor model is made both for

the premium and economy lines by the Chinese and for the premium line by the domestic

industry, all of which compete. At one point, around 2001, the domestic industry was

producing similar volumes of both economy and premium lines. However, over the past

few years, due to the lower prices of the Chinese product, the volume of the economy line

has grown to be higher than the volume of the premium line. With Chinese producers

concentrating their exports on high volume rotor models, the domestic industry, in an

effort to maintain and hopefully increase market share, is continuing to introduce new

premium models for all but the very bottom end low-priced vehicles.67

The Chinese respondents, however, claimed that virtually no competition exists “between the bulk of the

subject imports and the domestic like product and any competition between subject imports and the

domestic like product would continue to be attenuated after the antidumping duty order is revoked.”68 

In its posthearing brief, Federal-Mogul claimed that “there has always been two market segments

in the aftermarket rotor market – premium and economy grade.” The firm noted that Chinese rotors are

predominately economy grade, whereas the U.S. product is largely premium grade. Federal-Mogul went

on to note that “while these products have always been interchangeable to a degree, each grade is a

unique product segment . . . Premium rotors are sold to safety-conscious users, for high-end vehicle
 69 Posthearing brief of Federal-Mogul, pp. 32-33.

 70 Hearing transcript, p. 16 (Hughes).

 71 Posthearing brief of Chinese respondents, p. Q-23.

 72 Affinia indicated ***. Likewise, Federal-Mogul reported ***.

 73 Affinia reported ***.

 74 Federal-Mogul reported ***. Federal-Mogul added that “***.”

 75 Federal-Mogul reported ***.

 76 The Commission stated in its views for the original investigation (final phase) that “{t}wo principal domestic

like product issues exist in this investigation phase: (1) whether brake rotors and drums are distinct domestic like

products; and (2) whether the domestic like product(s) should be limited, as is the scope, to non-OEM products, or

should encompass OEM products as well.” The Commission determined that the record in the final phase of the

original investigation concerning the distinctions between rotors and drums was the same as that in the preliminary

phase, namely, that “rotors and drums do not operate in the same manner, are physically different, are not

interchangeable, and are perceived differently by producers,” and, accordingly, found brake rotors and brake drums

to be separate domestic like products.” The Commission also determined that the OEM rotors (and drums) and

aftermarket rotors (and drums) are “different products made by different manufacturers serving different markets,

notwithstanding their physical similarities.” Further, “{a}lthough the physical distinctions between OEM {rotors}

and their aftermarket counterparts are minimal, and all brake {rotors} are devoted to essentially the same end use,

any overlap that exists between the OEM and aftermarket products at issue is quite small in other respects pertinent

to domestic like product analysis. Aftermarket and OEM {rotors} are not interchangeable for use on original

equipment or for warranty work and appear to compete only minimally for use in nonwarranty work. Channels of

distribution are overwhelmingly distinct. Production processes and facilities are, except in isolated exceptions,

different. The evidence indicates that producers and their immediate customers perceive distinctions between OEM

and aftermarket products.” Finally, the Commission included unfinished and semifinished rotors in the same like

product as the finished product. Certain Brake Drums and Rotors from China: Investigation No. 731-TA-744

(continued...)

I-23

applications, and for fleet sales.”69 According to hearing testimony, the price differential between

premium and economy rotors has resulted in “very limited competition” between the grades, with sales of

the two types in different segments of the U.S. market to different customers at different prices.70 In

terms of differences in product pricing between premium and economy aftermarket brake rotors, the

Chinese respondents claimed that premium aftermarket rotors are priced *** to *** percent higher than

economy rotors in the U.S. market, pointing to a lack of “any price competition between premium and

economy-grade rotors.”71 For more information concerning pricing data collected on premium and

economy aftermarket brake rotors, see Part V of this report.

In response to a supplemental data request concerning premium and economy rotors, domestic

producers Affinia and Federal-Mogul indicated that during the period examined in this five-year review,

*** of their U.S. production was of the ***-grade rotors.72 Affinia also reported that *** were of ***

grade during the six-year period examined in this review73 and that *** were of the ***-grade rotors

during 2002-07. Likewise, during the same period, Federal-Mogul reported that *** were of the ***-

grade rotors74 and that *** were of the *** grade.75 In response to a similar supplemental request of the

12 Chinese producers that are parties to this review concerning their exports of premium and economy

brake rotors to the United States, they indicated that during the six-year period examined in this review,

*** of their exports of subject merchandise to the United States were of the economy-grade rotors.

Domestic Like Product Issues

In its original determination and its expedited five-year review determination, the Commission

defined the domestic like product as all aftermarket brake rotors, coextensive with Commerce’s scope,76
 76 (...continued)

(Final), USITC Publication 3035, April 1997, pp. 4 and 8-9. In its views for the expedited first five-year review of

the antidumping duty order, the Commission stated that “{n}o new facts have been presented in this review to

warrant a conclusion different from that reached by the Commission in the original investigation.” Brake Rotors

from China: Investigation No. 731-TA-744 (Review), USITC Publication 3528, July 2002, p. 5.

 77 AlliedSignal was excluded from the domestic aftermarket rotor industry on the grounds that it imported subject

rotors from China during the period of investigation and that its primary interest was in importation. One other firm

(Kinetic) also imported subject rotors from China and another firm (ITT Automotive) was also a related party

because it ***. The Commission did not exclude either ITT Automotive or Kinetic from the aftermarket rotor

industry, however, since “importation is a common practice in the domestic aftermarket rotor industry, and each firm

also maintains a significant domestic production presence.” The Commission also indicated that, “{m}oreover, ITT

{Automotive} and Kinetic’s importation activities did not cause their financial performance on their domestic

production to benefit vis a vis the domestic rotor producers that did not import subject rotors from China.” Certain

Brake Drums and Rotors from China: Investigation No. 731-TA-744 (Final), USITC Publication 3035, April 1997,

pp. 14-15.

 78 Certain Brake Drums and Rotors from China: Investigation No. 731-TA-744 (Final), USITC Publication 3035,

April 1997, pp. 3-15; and Brake Rotors from China: Investigation No. 731-TA-744 (Review), USITC Publication

3528, July 2002, pp. 4-6. As previously noted, the Commission’s domestic like product and domestic industry

findings in the Section 421 investigation concerning Certain Brake Drums and Rotors From China were consistent

with its previous findings in the underlying Title VII investigation and the first five-year review. Certain Brake

Drums and Rotors From China: Investigation No. TA-421-3, USITC Publication 3622, August 2003, 

pp. 7-14.

 79 72 FR 36037, July 2, 2007.

 80 Response of Coalition, August 21, 2007, p. 32.

 81 Response of Chinese respondents, August 21, 2007, p. 20.

 82 Posthearing brief of Chinese respondents, p. Q-7.

I-24

and it defined the domestic industry as all producers of aftermarket brake rotors. The Commission also

determined in its original determination that appropriate circumstances existed to exclude AlliedSignal

Automotive (“AlliedSignal”) from the domestic aftermarket rotor industry as a related party;77 however,

in its expedited first five-year review determination, the Commission noted that there was no information

on the record that would indicate that appropriate circumstances existed to exclude any producer from the

domestic industry.78

In its notice of institution in this current five-year review, the Commission solicited comments

from interested parties regarding the appropriate domestic like product and domestic industry.79 In its

response to the notice of institution, the Coalition (then consisting of both domestic producers, Affinia

and Federal-Mogul) indicated that it agreed with the Commission’s definition of the domestic like

product and domestic industry.80 The Chinese respondents, on the other hand, argued in their response

that it was impossible to take a position on the issue of the domestic like product or domestic industry at

that time. The respondents added that “were it not for the fact that no other entities exist to comprise a

domestic industry, it would be appropriate to exclude Affinia and Federal-Mogul from the domestic

industry as related parties due to their significant imports and shipments of subject merchandise from

China.”81 In their posthearing brief, the Chinese respondents argued definitively that “the Commission

should define the domestic like product in the same manner as in the original investigation and the first

review and coextensive with the scope of the order.”82 In fact, no party requested that the Commission
 83 The Chinese respondents were the only party to provide the Commission with comments on the draft

questionnaires in this review. Although the Coalition did not provide any comments on the draft questionnaires, it

provided the Commission with two pricing items to include in the pricing sections of the questionnaires.

 84 Posthearing brief of Chinese respondents, pp. Q-7 and Q-19.

 85 Posthearing brief of Federal-Mogul, pp. 10-18.

 86 In addition, Waupaca stated that OES rotors should be treated as aftermarket rotors since they are also service

parts. 

 87 Posthearing brief of Federal-Mogul, p. 27.

 88 Ibid., p. 28.

 89 Ibid.

 90 Ibid., p. 29.

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collect information regarding alternate domestic like products or domestic industries in their comments on

the Commission’s draft questionnaires.83

In response to a Commission request concerning the next most similar domestic like product to

aftermarket brake rotors, the Chinese respondents identified four alternative domestic like products most

similar to the article subject to the review (i.e., high performance brake rotors, OEM brake rotors, drums,

and raw castings) and Federal-Mogul identified three alternatives (i.e., raw castings, original equipment

service (“OES”)/OEM brake rotors, and high performance rotors). Concerning these alternative products,

the Chinese respondents argued that “[e]ach and all of these products are sold in different segments of the

U.S. market than subject aftermarket brake rotors from China, and overlap is virtually nonexistent. They

may have similar physical characteristics, but they are sold through different channels of distribution, to

different end uses, and are perceived to be different products by the consumer.”84 Federal-Mogul’s

statements concerning these alternative products were similar to those of the Chinese respondents but

added that when considering physical characteristics and customer perception, a closer comparison to

aftermarket brake rotors can be made with the OEM rotors.85 Further information concerning these four

alternative products are discussed below.86

Raw Castings

According to Federal-Mogul, castings producers (i.e., foundries, such as Waupaca) “are hired to

produce a mold and to pour the liquid material into the mold . . . ***’s entire expertise is in knowing how

to produce a mold and in understanding how to pour gray iron into the mold so that it produces a high

quality casting . . . the company’s technology and investment is not specific to the rotor industry.”87

Federal-Mogul asserted that it essentially “provided *** with a ‘recipe’ for producing a casting, and ***

charged Federal-Mogul for each input used to ‘prepare’ the casting, as well as for the final product.”88

According to Federal-Mogul, “*** does not have expertise in the rotor industry, or knowledge of how to

produce rotors.”89 Federal-Mogul went on to note that aftermarket brake rotor producers have equipment

and personnel dedicated to the production of such rotors, whereas casting producers such as *** do not

invest in any of this type of equipment, presenting “a clear dividing line between a casting and

unfinished, semi-finished and finished brake rotors.”90 

Although castings producers (foundries) manufacture a wide variety of raw castings for different

end-use applications, a raw casting for the production of aftermarket brake rotors has the essential

characteristic of an aftermarket brake rotor and is dedicated to that end use. The Chinese respondents

noted that “raw castings are essentially a component or ‘semi-finished’ articles that has to be further
 91 Posthearing brief of Chinese respondents, p. Q-9.

 92 Ibid., pp. Q-9-Q-10.

 93 Prehearing brief of Federal-Mogul, p. 6; Posthearing brief of Federal-Mogul, p. 31.

 94 Rotors often are made with ventilating fins between the two rotor surfaces to improve rotor cooling.

 95 Staff Report, March 18, 1997 (INV-U-020), p. I-5-I-6.

 96 Certain Brake Drums and Rotors From China: Investigation No. 731-TA-744 (Final), USITC Publication

3035, April 1997, p. 1. 

 97 Ibid., pp. 4 and 8-9; and Brake Rotors From China: Investigation No. 731-TA-744 (Review), USITC

Publication 3528, July 2002, p. 5. 

I-26

processed to be sold to an end-user.”91 Such processing includes machining, drilling of holes, the addition

of ABS sensors, and other finishing work, according to respondents. They also stated that the production

of brake rotors from raw castings “involves significant costs and sophistica[ted] machining,” and that “the

value of the final product can be as much as 50 percent higher than the value of the raw casting used as

input.”92 Federal-Mogul reported that the raw casting, in addition to other raw materials, represents about

*** percent of the total cost of manufacturing an aftermarket brake rotor but that the cost of the raw

casting is primarily a function of the raw materials used to produce them.93

Brake Drums

A different vehicle braking system uses brake drums where the braking action is created by a

brake shoe being forced outward against the inside of a rotating drum. Brake drums are found primarily

on the rear wheels of motor vehicles whereas brake rotors are usually used on the front wheels. Because

the braking unit of rotors is not enclosed, disc brakes are generally more efficient in transferring the heat

resulting from braking action.94 This fact is particularly important for front-wheel-drive vehicles where

the greater portion of vehicle weight and braking pressure is applied to the front wheel brake assemblies. 

The increased number of front-wheel-drive motor vehicles on the roads in the United States has

contributed to greater demand for rotors, as has a design shift to a disc braking system using four, rather

than two, rotors.95

The Commission’s original investigation concerned both brake drums and rotors from China;

however, the Commission determined that an industry in the United States was not materially injured or

threatened with material injury, and the establishment of an industry in the United States was not

materially retarded, by reason of imports from China of certain brake drums that had been found by

Commerce to be sold in the United States at LTFV.96 The Commission determined in the original

investigation and first five-year review that “rotors and drums do not operate in the same manner, are

physically different, are not interchangeable, and are perceived differently by producers,” and,

accordingly, found brake rotors and brake drums to be separate domestic like products.97

OEM Brake Rotors

The only brake rotors that are subject to the antidumping duty order are those for the aftermarket,

i.e., those that do not contain in the casting a logo of an OEM which produces vehicles sold in the United

States. The Chinese respondents noted in their posthearing brief that they “understand there to be clear

dividing lines between OEM and aftermarket brake rotors” and indicated that earlier Commission

findings regarding differences between aftermarket and OEM brake rotors in terms of products,
 98 Posthearing brief of Chinese respondents, pp. Q-5-Q-6.

 99 Ibid., p. Q-7.

 100 Includes those rotors sold to OE manufacturers and car dealers. Posthearing brief of Federal-Mogul, p. 13.

 101 Posthearing brief of Federal-Mogul, pp. 12-15.

 102 Ibid., p. 17.

 103 Certain Brake Drums and Rotors from China: Investigation No. 731-TA-744 (Final), USITC Publication 3035,

April 1997, p. I-9.

 104 Ibid., p. I-12. 

 105 Hearing transcript, p. 52 (Wappelhorst).

 106 Ibid., p. 68 (Wappelhorst).

 107 ThyssenKrupp Waupaca, written submission, April 24, 2008, p. 3.

I-27

manufacturers, and markets “continue to be the case.”98 With no apparent “overlap between OEM and

aftermarket brake rotors in the U.S. market,” they argued that the appropriate definition of domestic like

product should remain limited to aftermarket brake rotors.99

Federal-Mogul noted that OE brake rotors100 are not at all similar to aftermarket brake rotors; 

they are not interchangeable with aftermarket rotors, they are sold through different channels, they are

produced at separate facilities, and they are much more expensive than aftermarket brake rotors. FederalMogul claimed that substantial differences also exist in terms of product characteristics and customer

perception. OE brake rotors have “unique physical characteristics” that differ from aftermarket rotors (as

well as high performance rotors) and customers perceive aftermarket rotors differently than OE brake

rotors.101 Federal-Mogul claimed that, as a result, there is “no substitutability between the original like

product (aftermarket brake rotors) and the next most similar domestic like product (OE brake rotors).”102

Original equipment brake rotors sold in the aftermarket are designated original equipment service

(“OES”) parts, and are essentially the same as the OEM-certified parts. OES parts are generally supplied

through licensed parts distributors and approved motor vehicle dealers. However, OES brake drums and

rotors can be sold through traditional outlets such as service stations and repair shops. This scenario

occurs when an end-user specifies the use of an OES replacement part to an installer or repair shop, which

then purchases the OES brake drum or rotor from a licensed parts distributor or dealer.103

OES brake drums and rotors are generally produced in large quantities on the same transfer lines

used to produce OEM parts, and then dispersed to approved parts and distributors and dealers from

inventory. In instances where a part is no longer available from inventory or an OEM supplier, the part

can be outsourced from a non-OEM manufacturer.104

With respect to OES rotors, Federal-Mogul indicated that “. . . the specifications *** were the

same because we got to work with the OEM engineers in Detroit and had to meet their specifications for

the OES product.”105 The castings used in the production of OEM and OES brake rotors are the same as

well.106 ThyssenKrupp Waupaca, however, argues that OES rotors should be included as aftermarket

parts because they are service parts.107

High Performance Brake Rotors

High performance brake rotors are domestically manufactured for sale to the high

performance/racing segment of the industry. Domestic firms that produce these rotors purchase raw

castings, unfinished, semi-finished, or finished rotors and “perform extensive machining operations” in
 108 Posthearing brief of Chinese respondents, p. Q-24; Telephone interview with ***.

 109 Posthearing brief of Chinese respondents, p. Q-24.

 110 Ibid., pp. Q-24-Q-25.

 111 The Chinese respondents indicated that the Chinese producers are not currently capable of producing these

highly specialized rotors for the high performance market. Posthearing brief of Chinese respondents, 

p. Q-25. In fact, *** indicated *** that “[f]oundries producing the advanced metallurgy and higher quality standards

required by the performance industry are typically not found in China.”

 112 Posthearing brief of Chinese respondents, p. Q-24.

 113 Hearing transcript, p. 108 (Woo).

 114 Posthearing brief of Federal-Mogul, pp. 12-15.

 115 ITT Automotive, which accounted for *** percent of total 1995 reported U.S. production of aftermarket brake

rotors, *** in the original investigation.

I-28

the United States, adding value such as slots, drilled holes, aluminum adapters, and plating.108 Such value

added by these specialized producers “can double the final price of the brake rotor.”109 The raw castings

used to manufacture these rotors are produced from very specialized alloys or iron mixtures, and are

significantly more expensive than raw castings used for even premium aftermarket brake rotors.110

Furthermore, tolerances for these high performance rotors are equivalent to or higher than even those for

OEM brake rotors.111 As a result, these high performance rotors are sold through “a completely different

channel in the high performance segment of the U.S. market.”112 In fact, the high performance rotors

produced for the racing market are “highly customized” and are not considered a direct replacement part

for the average passenger vehicle.113

CWD, the successor firm to PPG (aka Power Slot and StopTech), indicated *** that 

* * * * * * *

Moreover, Federal-Mogul noted that, not unlike the comparison of OE rotors and aftermarket brake

rotors, there are distinct differences in high performance rotors and the aftermarket brake rotors. High

performance rotors are not interchangeable with aftermarket brake rotors, they are sold through different

channels of distribution, they are produced at separate facilities from aftermarket rotors, and they are

much more expensive than aftermarket brake rotors. As was the case with OE rotors, Federal-Mogul

claimed that there are substantial differences in product characteristics and customer perception between

high performance rotors and aftermarket brake rotors. High performance rotors have “unique physical

characteristics” that are different than aftermarket rotors and the customers of these highly specialized

products clearly perceive aftermarket rotors differently than the high performance product.114

U.S. MARKET PARTICIPANTS

U.S. Producers

During the Commission’s original Title VII investigation, brake rotors were manufactured in the

United States by seven firms whose sales were directed primarily to the automotive aftermarket. These

seven firms were Brake Parts, Inc. (“Brake Parts”); Excel; Iroquois Tool Systems, Inc. (“Iroquois”); ITT

Automotive, Inc. (“ITT Automotive”);115 Kinetic Parts Manufacturing, Inc. (“Kinetic”); Overseas Auto

Parts, Inc. (“Overseas”); and Wagner Brake Corp. (“Wagner”). All seven firms supplied the Commission

with information on their U.S. operations with respect to aftermarket brake rotors during the original

investigation. An eighth firm, Airtex, ceased its minimal production of aftermarket brake rotors during
 116 The Commission excluded AlliedSignal from the domestic industry as a related party in the original

investigation.

 117 OEM brake rotors were not part of the subject merchandise and were determined by the Commission at that

time not to be part of the domestic like product.

 118 Staff Report, March 18, 1997 (INV-U-020), p. II-3.

 119 Ibid., pp. III-1 - III-3.

 120 Prehearing brief of Federal-Mogul, p. 4.

 121 Waupaca, a subsidiary of the Budd Co./Thyssen Krupp Automotive, was an independent foundry that

produced raw castings, some of which it sold to *** for finishing. At the time of the Commission’s first review of

the order, the firm was in the process of expanding production at a sixth plant in Etowah, TN that was slated to

produce mostly gray iron castings (including brake drums and rotors and other components for cars and a range of

truck sizes) to be shipped to other companies (including OEMs) for finishing. The new plant was not fully

operational as of December 2001. Staff Report, June 28, 2002 (INV-Z-099), p. I-13. Note that the Commission’s

original staff report identified Waupaca as a producer of “unfinished rotors.” In this current review, Waupaca ***

does not perform any finishing on the raw castings it produces. ***.

 122 Universal, which was incorporated in January 1994, manufactured over 700,000 brake rotors annually at the

time of the Commission’s first review. The firm primarily purchased the raw iron castings from Waupaca and

sourced over 3 million brake rotors and drums from overseas manufacturing partners to complement its internally

manufactured product lines (from public information cited in Staff Report, June 28, 2002 (INV-Z-099), p. I-14).

 123 Staff Report, June 28, 2002 (INV-Z-099), pp. I-12-I-13.

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1993-95 and a ninth firm, AlliedSignal,116 produced a small amount of aftermarket rotors but

predominately manufactured original equipment manufacturer (“OEM”) product.117 The Commission’s

staff report in the original investigation also indicated that independent foundries were not part of the

Commission’s data set but that the petitioning firms’ postconference brief contained letters from four

foundries (***) stating that they had significant additional capacity.118 The members of the Coalition on

whose behalf the petition was filed consisted of the following four domestic producers of brake rotors: 

Brake Parts, Kinetic, Iroquois, and Wagner. These four firms together accounted for *** percent of

reported U.S. production of brake rotors during 1995.119 During the original investigation, the largest

U.S. producers produced their own castings in the United States and machined them into finished

aftermarket brake rotors. Domestic production accounted for *** percent of apparent U.S. consumption

in 1995.120

During the Commission’s first review of the antidumping duty order, the Coalition identified the

following six firms as producers of brake rotors in the United States: Dana, Federal-Mogul, Waupaca,121

TRW, Universal,122 and Honeywell (formerly AlliedSignal). The members of the Coalition during the

Commission’s first review were Dana, Federal-Mogul, and Waupaca. These three firms together were

believed to have represented from *** to *** percent of total U.S. production of aftermarket brake rotors

in 2001.123

The Coalition indicated in its response to the Commission’s notice of institution in the current

review that Affinia and Federal-Mogul were the only remaining U.S. producers of the domestic like
 124 The Coalition added that there are several small, low-volume, niche-market producers of specialty products in

the United States, such as for the racing industry. Three of these companies include PowerStop, Wilwood

Engineering (“Wilwood”), and PPG. The Coalition argued, however, that these firms do not produce brake rotors

and are not part of the domestic industry that services the general automobile and light truck aftermarket. The

Coalition explained that these firms simply purchase imported or domestically produced rotors and perform

specialized machining on them. Response of Coalition, August 21, 2007, pp. 20-21. In fact, Wilwood *** was not a

producer of aftermarket brake rotors. CWD, the successor firm to PPG and StopTech, provided a response to the

Commission’s producer questionnaire. In its response, CWD indicated that it ***. *** the price of the final

specialized rotor it markets. The Chinese respondents reported that these types of companies perform extensive

machining operations to transform the rotors into “high performance” rotors. In fact, they indicated that the value

added to these “high performance” rotors can often double the final price of the brake rotor. Moreover, the final

product is sold through a different channel in the high performance segment of the U.S. market. These rotors also

use castings produced from very specialized alloys or iron mixtures and are significantly more expensive than those

used for aftermarket brake rotors. They added that the Chinese producers are not capable of making rotors for this

market segment. Posthearing brief of respondents, pp. Q-24-Q-25.

 125 Only firms identified as domestic producers in the Commission’s staff reports in the original investigation and

first review are shown in table I-5 and figure I-1. Firms identified as possible domestic producers in this second

five-year review (such as those for the specialty “high performance” aftermarket) are not identified in table I-5 and

figure I-1 but are discussed throughout this report, as appropriate.

 126 CWD acquired StopTech in April 2006 and PPG (aka Power Slot) in October 2007. These producing firms

are collectively referred to as “CWD” in the remainder of this report, unless otherwise specified.

 127 Staff sent the Commission’s producer questionnaire to six of these eight additional firms on two separate

occasions (by overnight courier and by fax) in an attempt to solicit a response. The Commission also sent producer

questionnaires to Coleman Machine and Performance Friction after counsel for the Chinese interested parties

identified these two additional firms as possible domestic producers of aftermarket brake rotors by letter dated

March 19, 2008.

 128 ***. Posthearing brief of Federal-Mogul, pp. 24-25.

I-30

product during 2006.124 However, Federal-Mogul indicated *** in this current review that it permanently

ceased domestic production of aftermarket brake rotors in September 2007.

As indicated above, the domestic aftermarket brake rotor industry has undergone major

restructuring since the Commission’s original investigation. Bankruptcies, consolidations,

reorganizations, and closures have changed the composition of the domestic industry. Some domestic

producers closed their operations permanently, while others were initially acquired out of bankruptcy and

continued to operate for a time. Major changes in the structure of the domestic industry from the original

investigation to the present review are detailed in table I-5 and are illustrated in figure I-1.125

In this second five-year review, the Commission mailed U.S. producer questionnaires to Affinia

and Federal-Mogul, known domestic producers of the aftermarket brake rotors. The Commission also

sent U.S. producer questionnaires to Brembo; Coleman Machine; Honeywell International Inc.

(“Honeywell”); CWD;126 Performance Friction; PowerStop; ThyssenKrupp Waupaca (“Waupaca”); and

Wilwood.127 Domestic producers Affinia and Federal-Mogul provided information concerning their 

aftermarket brake rotors operations in response to the Commission’s producer questionnaire. Waupaca,

an independent foundry that produces raw castings in the United States, and CWD, a specialized finisher

for the “high performance” rotor market, also provided certain information in response to the

Commission’s producer questionnaire. Wilwood, on the other hand, responded to the Commission’s

request for information by indicating that ***.128 Although it did not provide a response to the 
I-31

Table I-5

Brake rotors: Changes in the structure of the U.S. industry

Firm Event

Airtex Airtex ceased its minimal production of aftermarket brake rotors during 1993-95.

Allied

Signal

Honeywell, a leader in diversified technology and manufacturing, merged with AlliedSignal in

December 1999. At the time of the Commission’s first review, AlliedSignal’s Bendix brand rotors

were being manufactured and sold under the Honeywell name for both the OEM and aftermarket. 

Honeywell indicated in its questionnaire response in the Commission’s 421 investigation that it ***.

Brake

Parts

Echlin, the parent company of Brake Parts, was acquired by Dana Corp. in July 1998. At the time of

the Commission’s first review, Brake Parts was known as the Brake and Chassis Division of Dana

Corp. (“Dana”). Dana’s Aftermarket Automotive Group was purchased by Affinia, a division of the

Cypress Group, in 2004.

Excel Excel ceased production in early 1996 and filed for bankruptcy. On Sept. 17, 1996, Excel was

adjudicated as a chapter 7 debtor. In its preliminary questionnaire for the original investigation,

Excel stated that ***.

Iroquois Iroquois was purchased in December 1996 by Echlin (the parent company of Brake Parts), which,

subsequently merged with Dana. Dana’s Aftermarket Automotive Group was purchased by Affinia

in 2004.

ITT

Automotive

ITT Automotive’s aftermarket rotor business (sold under the brand name AIMCO) was acquired by

Echlin, the parent company of Brake Parts, in 1997; Echlin subsequently merged with Dana in late

1998. Affinia purchased Dana’s Aftermarket Automotive Group in 2004.

Kinetic Kinetic’s name was changed to Autospecialty Co. and the firm was sold to Lucas Industries

Group/Lucas Varity PLC (“Lucas”) in February 1997; Lucas, in turn, was purchased by TRW

Aftermarket/TRW Automotive/ TRW Group (“TRW”) in March 1999. TRW was then purchased by

Northrop-Grumman in December 2002. Northrop-Grumman retained the defense business but sold

off the automotive section to The Blackstone Group in February 2003. In January 2004, the brake

rotor facilities were sold to Universal, which filed for Chapter 11 bankruptcy in 2005. Power Stop, a

domestic producer of high performance rotors, purchased Universal’s assets in September 2005. 

Universal’s production equipment for the “commodity” aftermarket brake rotors had been

permanently dismantled and disposed of prior to PowerStop’s acquisition of the company.

Overseas Overseas, with the exception of one minor shipment of rotors to Dana in mid-2002, stopped

manufacturing brake rotors for the aftermarket in mid-1998.

Wagner Wagner’s parent company, Cooper, was acquired by Federal-Mogul in October 1998. FederalMogul filed voluntary Chapter 11 petitions for reorganization in the U.S. Bankruptcy Court for the

District of Delaware on October 1, 2001. The restructuring proceedings were initiated in response

to a sharply increasing number of asbestos-related claims and their demand on the company’s cash

flows and liquidity. Federal-Mogul permanently closed its U.S. production facilities in September

2007. Federal-Mogul’s emergence from bankruptcy became effective on December 27, 2007, with

its reorganization plan. 

Waupaca Waupaca, a subsidiary of the Budd Co./Thyssen Krupp Automotive, is an independent foundry that

produces raw castings for aftermarket brake rotors.

Source: Staff Report, March 18, 1997 (INV-U-020), pp. III-1 - III-3; Staff Report, June 28, 2002 (INV-Z-099), 

pp. I-12 - I-14; Staff Report, July 29, 2003 (INV-AA-107), pp. I-3, I-18, and I-19; Response of Coalition, August 21,

2007, pp. 20-21; Cypress Group Acquiring Dana's Automotive Aftermarket Group, The eBearing News, 

http://www.ebearing.com/news2004/072001.htm, July 20, 2004, retrieved on July 16, 2007; News Release: Rapid

Response Team Activated to Aid Universal Automotive Industries Employees, Missouri Department of Economic

Development, https://edis.usitc.gov/hvweb/hvweb.dll?displaydocument&283097, November 1, 2002, retrieved on

July 16, 2007; Universal Automotive Acquires Certain Assets of TRW Automotive’s Kelsey-Hayes Subsidiary, Universal Automotive, Inc. Press Release, January 12, 2004, http://www.secinfo.com/dsvRm.132.d.htm, retrieved

on September 20, 2007; Universal Automotive Seeks Chapter 11 Protection, Universal Automotive, Inc. Press

Release, May 25, 2005, http://www.secinfo.com/dsvRm.z6nj.c.htm, retrieved on July 16, 2007; PowerStop, LLC

Acquires the PowerStop and Other Business Assets from Universal Automotive Industries, Power Stop Company

History, September 13, 2005, http://www.universalbrake.com/html/company_history.html, retrieved on July 16,

2007; Welcome to the Federal-Mogul Corporation Reorganization Web Site, Federal-Mogul,

http://www.fmoplan.com/, retrieved on March 13, 2008; Federal-Mogul Corp. Form 10-K, Fiscal Year Ended

December 31, 2006, p. 4; telephone interview with Jim Guerino, PowerStop, April 30, 2008..
I-32

Figure I-1

Brake rotors: The composition of the U.S. industry, 1995, 2001, 2003, and 2007

U.S. producers in 1995

(original investigation)

U.S. producers in 2001

(first review)

U.S. producers in 2003

(421 investigation)

U.S. producers in 2007

(second review)

AlliedSignal Honeywell (ceased

production)

Kinetic TRW TRW

PowerStop

(finisher of

specialized rotors

for the “high

performance”

Universal market)

Universal

(production

equipment for

“commodity” brake

rotors permanently

shut down)

Waupaca 

(foundry)

Waupaca 

(foundry)

Waupaca 

(foundry)

Waupaca 

(foundry)

Overseas (ceased

production in 1998)

Excel (ceased

production in 1996)

Wagner Federal-Mogul Federal-Mogul

Federal-Mogul

(permanently

closed production

facility in

September 2007)

Airtex (ceased

production during

1993-95)

Brake Parts

Iroquois Dana Dana Affinia

ITT Automotive

Source: Compiled from information submitted in response to Commission questionnaires; Staff Report, March 18,

1997 (INV-U-020), pp. III-1 - III-3; Staff Report, June 28, 2002 (INV-Z-099), pp. I-12 - I-14; Staff Report, July 29,

2003 (INV-AA-107), pp. I-3, I-18, and I-19; and table I-5, infra.
 129 Letters to Marilyn R. Abbott from Michael J. Mlotkowski, Roberts Mlotkowski & Hobbes, April 14, 2008 and

April 24, 2008.

 130 The domestic interested parties indicated in their response to the Commission’s notice of institution in this

review that Brembo is no longer manufacturing rotors in the United States. Response of Coalition, August 21, 2007,

p. 21. In fact, according to the company website, Brembo’s only production location in North America is in Mexico. 

http://www.brembo.com/ENG/AboutBrembo/CompanyOverview/BremboGroup/BremboNA, retrieved on

September 19, 2007. Although it did not provide a response to the Commission’s producer questionnaire,

Honeywell *** does not produce aftermarket brake rotors in the United States.

 131 As indicated earlier, CWD acquired PPG (aka Power Slot) in October 2007 and StopTech in April 2006.

 132 Response of Coalition, August 21, 2007, pp. 20-21.

 133 Posthearing brief of Chinese respondents, p. Q-10; Posthearing brief of Federal-Mogul, pp. 25-32.

 134 Letter to the Honorable Marilyn R. Abbott from Kris Pfaehler, ThyssenKrupp Waupaca, April 24, 2008.

 135 At the time of the Coalition’s filing of the response to the Commission’s notice of institution, both FederalMogul and Affinia were members of the Coalition in support of the continuation of the antidumping duty order. 

Response of Coalition, August 21, 2007, p. 4. Federal-Mogul permanently ceased domestic production of

aftermarket brake rotors and subsequently withdrew from the Coalition. Letter to Marilyn R. Abbott from Porter,

Wright, Morris and Arthur, LLC, February 8, 2008.

I-33

Commission’s producer questionnaire, counsel for Performance Friction filed public letters on two

separate occasions with the Commission stating the following:

Performance Friction would like to correct the record by stating that it is a U.S. producer

of domestic like product, with 100 percent of its brake calipers, rotors and pads produced

in its state of the art production plant located in Clover, South Carolina. This 200,000

square foot plant employs over 200 employees and supplies Original Equipment Truck

Manufacturers, hundreds of major fleets, major automotive retailers, thousands of brake

installers and automotive manufacturers in the domestic and international markets. In

addition to servicing the general automobile, truck, and light truck aftermarket,

Performance Friction also provides domestically produced brake calipers, rotors and pads

for the racing industry globally.129

Evidence indicates that Brembo and Honeywell no longer produce brake rotors in the United States.130

No responses to the Commission’s U.S. producer questionnaire were received from Coleman Machine

and PowerStop. The Coalition indicated in its response to the Commission’s notice of institution in this

review that PowerStop, PPG,131 and Wilwood were small, low-volume, niche-market producers of

specialty products for the racing industry and that they do not actually produce the rotors they market but

simply perform specialized machining on purchased or imported rotors. The Coalition indicated that it

does not believe that these types of companies are part of the domestic industry.132 Likewise, the Chinese

respondents and Federal-Mogul argued that foundries producing only raw castings and other nichemarket producers of specialty rotors should not be deemed part of the aftermarket brake rotor industry in

this review.133 Waupaca responded as follows: “We do not finish the castings so we cannot argue against

this narrow definition of producer as given in this investigation but all U.S. foundries are essential to the

domestic production of aftermarket brake rotors.”134

Affinia indicated in its questionnaire response ***. Federal-Mogul, however, indicated in its

questionnaire response ***.135 Independent foundry Waupaca indicated in its questionnaire response ***. 

CWD, a finisher of “high performance” rotors, indicated in its questionnaire response ***. In public

correspondence filed with the Commission by Performance Friction, the company noted only that it “is a

domestic producer of brake calipers, rotors and pads impacted by the practices subject to the instant
I-34

review” but it did not indicate its position on the antidumping duty order. Details regarding each

responding firm’s production location(s), share of 2007 production, parent company, and position on the

order are presented in table I-6.

Table I-6 

Brake rotors: U.S. producers, locations, parent companies, positions on the order, and shares of 2007

production

Firm Product Production location(s) Parent company

Position

on order

Share of

2007

production

(percent)

Affinia

Aftermarket

brake rotors

McHenry, IL1

North East, PA1

Litchfield, IL

Waupaca, WI

Cypress Corp. (New

York, NY) Support ***

FederalMogulAftermarket

brake rotors St. Louis, MO2 None Oppose ***

Waupaca

Raw castings

for aftermarket

brake rotors Waupaca, WI

ThyssenKrupp

Technologies Inc.

(Germany) Support (3

)

CWD

High

performance

brake rotors

Carson, CA (Centric Parts)

Compton, CA (StopTech)

Chatsworth, CA (PPG/aka

Power Slot)

CWD 

(Carson, CA) *** (4

)

 1

 Affinia permanently shut down its production operations at its McHenry facility ***. ***. Affinia permanently

closed its North East facility ***. ***.

 2

 Federal-Mogul’s Century Plant in St. Louis, MO, was engaged in the production of aftermarket brake rotors

until it closed in September 2007. In the absence of any domestic production facilities, the company listed its

corporate office in Southfield, MI, as its company location.

 3

 Waupaca supplied a total of *** raw castings (valued at $***) to domestic aftermarket brake rotor producers

***. Waupaca’s U.S. shipments of raw castings accounted for *** percent of *** domestic production of finished

aftermarket brake rotors during 2007.

 4

 CWD ***. During 2007, CWD shipped *** of its “high performance” rotors to the specialty market. CWD’s total

shipments of “high performance” rotors accounted for *** percent of *** domestic production of finished aftermarket

brake rotors during 2007.

Source: Compiled from information submitted in response to Commission questionnaires and Response of

Coalition, August 21, 2007, p. 3.

Although both Affinia and Federal-Mogul reported that they are U.S. importers of aftermarket

brake rotors, neither indicated *** that they have any other related firms, either domestic or foreign,

which are engaged in importing aftermarket brake rotors from any country into the United States or

which are engaged in exporting aftermarket brake rotors from any country to the United States. 

However, both firms *** have certain business affiliations with firms in China, and Affinia *** produces

aftermarket brake rotors in countries other than China and the United States. 

*** Affinia *** produces aftermarket brake rotors in Argentina (Armetal Brakes) and Venezuela

(Affinia Venezuela). In addition, in the Coalition’s response to the Commission’s notice of institution in

this review, Affinia indicated that it has several business affiliations with firms in China. It reported that,

***, it entered into a joint venture agreement with MAT Holdings, Inc. (“MAT Holdings”), which is

owned by Mr. Steve Wang, ***. Affinia also reported that Mr. Steve Wang, MAT Holdings’ owner, has

an ownership interest in four firms in China from which Affinia purchases significant quantities of
 136 These four firms are: Laizhou Luyuan Automobile Fitting Co. (“Laizhou Luyuan”); Shenyang Honbase

Machinery Co. Ltd. (“Shenyang”); MAT Automotive, Inc. (“MAT Automotive”); and GRI Engineering &

Development (“GRI”). Laizhou Luyuan and Shenyang are Chinese exporters of brake rotors to the United States

and MAT Automotive and GRI are U.S. importers of subject merchandise from China. Supplemental Response of

Coalition, September 6, 2007.

 137 Affinia provided the following information as it relates to brake rotors (from China or any other country): 

“***.” Supplemental Response of Coalition, September 6, 2007.

 138 Supplemental Response of Coalition, September 6, 2007.

 139 ***.

 140 Staff Report, March 18, 1997 (INV-U-020), pp. IV-1-IV-2.

 141 Staff Report, June 28, 2002 (INV-Z-099), p. I-20.

 142 Response of Coalition, August 21, 2007, pp. 21-24; and Response of Chinese respondents, August 21, 2007, p.

15. 

 143 Response of Chinese respondents, August 21, 2007, p. 20.

I-35

aftermarket Chinese brake rotors.136 Affinia indicated, however, that its purchases of brake rotors from

these four suppliers ***.137

Federal-Mogul indicated in the Coalition’s response to the Commission’ notice of institution in

this review that it owns, directly or indirectly, *** of five entities in China which produce automotive

parts other than brake rotors for the aftermarket ***. It identified the following five entities: (1) FederalMogul (Shanghai) Automotive Co. Ltd., a distribution and engineering business; (2) Federal-Mogul

Qingdao Automotive Co. Ltd., a manufacturing facility ***; (3) Federal-Mogul Sealing Systems Co., a

manufacturer of sealing products for vehicles; (4) Federal-Mogul Friction Products Co. Ltd., a

manufacturer of friction materials for vehicles; and (5) Federal-Mogul Champion Spark Plug

(Guangzhou) Co. Ltd., a producer of ignition products. Federal-Mogul also reported that it has *** in the

following three Chinese entities: (1) Federal-Mogul Shanghai Bearings Co. Ltd., a producer of engine

bearings; (2) Federal-Mogul Qingdao Piston Co. Ltd., a producer of pistons; and (3) Anqing TP Goetze

Piston Ring Co. Ltd., ***. Federal-Mogul reported that it has no other ownership interests or joint

ventures in China and that none of the entities listed above produces and/or exports aftermarket brake

rotors to the United States.138

Waupaca indicated in its questionnaire response that ***. CWD indicated in ***. 

U.S. Importers

In the original investigation, 26 firms (including 2 U.S. producers),139 accounting for nearly all of

subject imports, reported data to the Commission on their imports of brake rotors from China. Six firms

(***) were responsible for *** of subject brake rotor imports from China in 1995. Most of the reporting

firms were independently owned importer brokers and/or distributors, although several were related to

Chinese exporters or manufacturers. ***.140

In its response to the Commission’s notice of institution in the first review, the Coalition

identified 43 firms that imported subject brake rotors from China into the United States.141 The domestic

interested parties in this second five-year review identified 50 companies that imported subject rotors into

the United States from China and the Chinese respondents listed 36 companies as U.S. importers of brake

rotors from China.142 The Chinese respondents reported in their response to the Commission’s notice of

institution in this review that, in 2007, Affinia and Federal-Mogul were among the largest importers of

subject merchandise in the U.S. market.143

In this current review, 21 U.S. importers responded to the Commission’s request for information

by supplying usable import data. As indicated earlier, based on official Commerce statistics for imports
 144 The coverage figures presented are somewhat understated because the HTS category under which the subject

merchandise is classified is a much broader category.

 145 ***.

 146 ***.

I-36

of brake rotors (both OEM and aftermarket), importers’ questionnaire data accounted for 36.3 percent of

total U.S. imports during 2007 and 57.5 percent of total imports from China in 2007.144 Based on export

data provided in foreign producer questionnaire responses, the subject import data obtained through

importer questionnaires accounted for 67.6 percent of reported exports of subject merchandise to the

United States from China in 2007. Twenty of the reporting U.S. importers of aftermarket brake rotors are

located in four major geographic areas in the United States: the Illinois and Michigan area; the Virginia,

Tennessee, and South Carolina area; the Connecticut, Massachusetts, New Jersey, and New York area;

and California. One reporting U.S. importer of record is located in Toronto, Canada. Table I-7 presents a

summary of information regarding the 21 reporting U.S. importers of aftermarket brake rotors.

Table I-7

Brake rotors: Reporting U.S. importers, parent companies, locations, sources of imports, and

shares of reported U.S. imports, 2007

* * * * * * *

As indicated in table I-7, reported U.S. imports of aftermarket brake rotors were concentrated

among a few firms during 2007. The largest importer, ***, accounted for *** of total reported imports

during 2007. The top five importers accounted for more than three-fourths of total reported imports

during 2007,145 and the next largest three importers accounted for 17 percent of reported imports in that

year,146 yielding a total of 95 percent of total reported imports in 2007 handled by eight importers. All but

one of the importers that responded to the Commission’s questionnaire reported imports of subject

aftermarket brake rotors from China; 11 of these imported aftermarket brake rotors from both subject and

nonsubject sources and nine imported only subject merchandise from China. *** reported that its direct

imports were from only nonsubject sources in ***.

In its questionnaire, the Commission requested U.S. importers to indicate whether they have any

other related firms, either domestic or foreign, which are engaged in (1) importing aftermarket brake

rotors from any country into the United States, (2) exporting aftermarket brake rotors from any country to

the United States, and/or (3) producing aftermarket brake rotors in any country, domestic or foreign. Four

responding U.S. importers (***) identified such relationships; the remaining 17 U.S. importers

responding to the Commission’s importer questionnaire indicated that they have no such relationships

with importers, exporters, or producers. ***. ***. Importer Uquality Automotive Parts Corp.

(“Uquality”) reported ***.

U.S. Purchasers

Purchasers’ questionnaires were sent to 37 firms identified as purchasers of aftermarket brake

rotors. Responding purchasers, locations, sources of purchases, and the type of firm are presented in table

I-8.
 147 Response of the Coalition, August 21, 2007, p. 29.

 148 Ibid., p. 16.

 149 Ibid., pp. 29-30.

 150 Response of Chinese respondents, August 21, 2007, pp. 9 and 19.

 151 Ibid.

I-37

Table I-8

Brake rotors: Purchasers, locations, sources of purchases, and type of firm

* * * * * * *

APPARENT U.S. CONSUMPTION AND MARKET SHARES

Citing the Frost & Sullivan Report in its response to the Commission’s notice of institution in this

current review, the Coalition indicated that “{d}emand for brake rotors is driven by a number of factors,

such as the quantity of vehicles in use, average miles driven per year, average age of vehicles and the

driving behavior of the population.”147 The Coalition further reported that the Frost & Sullivan Report

shows the aftermarket for the brake rotor industry increasing at a rate of about 2.2 percent per year.148

The domestic interested parties also reported that although the U.S. aftermarket brake rotor industry has

shifted substantially to economy rotors, which has resulted in higher replacement rates for brake rotors, a

potential restraint on the market is forecast in the future in view of the higher prices of gasoline. They

explained that the average miles driven per year is expected to diminish in the future with the gradual

change in the driving behavior of the population, which will translate into the longer life of rotors and

fewer replacements.149 The Chinese respondents, on the other hand, indicated that the demand for

aftermarket brake rotors is expected to increase “on a steady basis” in the United States in the future and

that the demand for aftermarket brake rotors in China and other markets, especially Asia, is expected to

increase “exponentially.”150 It explained that the expected growth in the demand for aftermarket brake

rotors in China “will follow the phenomenal growth in the number of automobiles sold in China.”151

Table I-9 presents U.S. shipments of domestic and imported aftermarket brake rotors and

apparent U.S. consumption for 2002-07, as obtained through Commission questionnaire responses in this

review and from official import statistics. Table I-10 presents total U.S. consumption and market shares

for the same period. Apparent U.S. consumption (on the basis of quantity) was *** percent higher in

2007 than in 2002, increasing in each year except for 2004. The share of domestic consumption (on the

basis of quantity) held by U.S. producers of aftermarket brake rotors declined by *** percentage points

from *** percent in 2002 to *** percent in 2007. Likewise, the share held by imports from countries

other than China fell by *** percentage points in the same period. On the other hand, the share of

domestic consumption (on the basis of quantity) held by subject imports from China increased overall by

*** percentage points from *** percent in 2002 to *** percent in 2007. The share (on the basis of

quantity) held by nonsubject imports produced by Chinese companies excluded from the order also

increased overall from 2002 to 2007 by *** percentage points.
I-38

Table I-9

Brake rotors: U.S. shipments of domestic product, U.S. imports, by sources, and apparent U.S.

consumption, 2002-07

Item 2002 2003 2004 2005 2006 2007

Quantity (1,000 rotors)

U.S. producers’ U.S. shipments *** *** *** *** *** ***

U.S. imports from--

 China (subject) 7,703 12,882 14,961 17,743 23,796 33,073

 China (nonsubject) 5,549 6,951 3,809 4,570 7,738 13,492

 Other sources 42,300 38,075 32,259 39,658 41,691 37,170

 Total sources 55,551 57,908 51,030 61,971 73,225 83,735

Total U.S. consumption *** *** *** *** *** ***

Value ($1,000)

1

U.S. producers’ U.S. shipments *** *** *** *** *** ***

U.S. imports from--

 China (subject) 52,315 93,412 117,655 158,994 202,200 283,907

 China (nonsubject) 32,822 44,162 26,952 32,027 51,310 100,468

 Other sources 592,580 565,743 523,590 472,382 538,848 507,633

 Total sources 677,717 703,317 668,197 663,403 792,358 892,009

Total U.S. consumption *** *** *** *** *** ***

Unit value (per rotor)

U.S. producers’ U.S. shipments $*** $*** $*** $*** $*** $***

U.S. imports from--

 China (subject) 6.79 7.25 7.86 8.96 8.50 8.58

 China (nonsubject) 5.91 6.35 7.08 7.01 6.63 7.45

 Other sources 14.01 14.86 16.23 11.91 12.92 13.66

 Total sources 12.20 12.15 13.09 10.71 10.82 10.65

Total U.S. consumption *** *** *** *** *** ***

 1 F.o.b. U.S. point of shipment for U.S. producers’ U.S. shipments and landed, duty-paid for imports.

Note.–Because of rounding, figures may not add to the totals shown.

Source: Compiled from data submitted in response to Commission questionnaires and from official Commerce

import statistics. The quantity of imports from China (subject) is the quantity of exports to the United States

compiled from foreign producer questionnaire responses. The value of imports from China (subject) is constructed

by multiplying the average unit value of U.S. shipments of imports of subject product calculated from importer

questionnaire responses by the quantity of exports to the United States. The quantity and value of U.S. imports

from China (nonsubject) and other sources are from official Commerce import statistics, including proprietary

statistics from U.S. Customs and Border Protection. 
I-39

Table I-10

Brake rotors: Total U.S. consumption and market shares, 2002-07

* * * * * * *
 
 1 Response of Coalition, August 21, 2007, p. 29.

 2

 Ibid.

II-1

PART II: CONDITIONS OF COMPETITION IN THE U.S. MARKET

MARKET CHARACTERISTICS/CHANNELS OF DISTRIBUTION

Aftermarket brake rotors are used in automobiles as replacement parts. The demand for

aftermarket brake rotors is determined by a number of factors, including the number of vehicles in use,

the average age of vehicles, and the average number of miles driven in a year.1

 Aftermarket brake rotors

are available in economy and premium grades. According to domestic producers, premium rotors are

heavier, more expensive, and tend to last longer. Domestic producers note that the aftermarket brake

rotor industry has shifted substantially to economy rotors and because of the lower cost of this type of

brake rotors, the market has shifted more towards replacement rather than resurfacing.2

 

Aftermarket brake rotors have generally been sold to automotive parts distributors, retail outlets,

and end users. U.S. producers reported that *** of their shipments of brake rotors during the period of

review were to automotive parts distributors. Importers of brake rotors from China reported selling to

both distributors and to end users. Data submitted in this review indicate that *** U.S. shipments of

imported Chinese brake rotors were to distributors. One importer, ***, reported some shipments to end

users; however, shipments to distributors accounted for *** percent of *** total shipments during the

period 2002-07.

*** reported shipping brake rotors nationwide and a number of importers (six firms) reported also

doing so (table II-1). Some of the responding importers reported that they served regional markets such

as the Northeast, Midwest, Southeast, and the Southwest.

Table II-1

Brake rotors: Geographic market areas in the United States served by domestic producers and

importers

Region Producers Importers1

National 2 7

Northeast 0 3

Mid-Atlantic 0 1

Midwest 0 6

Southeast 0 3

Southwest 0 1

Rocky Mountains 0 0

West Coast 0 2

Northwest 0 0

 1

 Importers’ responses in this table do not include the responses of firms that are also U.S. producers. Both U.S.

producers also imported brake rotors and their responses ***. In addition, some importers reported nationwide

sales and then also reported specific geographic market areas; their responses are only noted as nationwide as

that encompasses all other market areas.

Source: Compiled from data submitted in response to Commission questionnaires.
 3

 It is important to note that although available data indicate that there is unused capacity for ***, the overall level

of U.S. capacity to produce brake rotors was much lower in 2007 than it was during earlier years of the period of

review; thus, U.S. producers’ supply responsiveness is constrained by this *** level of capacity. 

 4

 As noted, overall capacity to produce brake rotors declined as Federal-Mogul permanently shut down its

domestic production facilities in September 2007 and Affinia permanently closed its McHenry, IL facility. FederalMogul stated that its “production facilities haven’t been mothballed, they are not temporarily shut down...the

facilities are gone” (hearing transcript, p. 35 (Mintzer). Thus, while there is unused capacity, the degree to which

U.S. producers could increase production is constrained by the *** level of existing overall capacity.

II-2

SUPPLY AND DEMAND CONSIDERATIONS

U.S. Supply

Domestic Production

Based on available information, staff believes that Affinia has the ability to respond to changes in

demand with small to moderate changes in shipments of U.S.-produced brake rotors to the U.S. market. 

Should demand increase, Affinia has some unused capacity and relatively *** with which it could

respond.3

 Should demand decrease, however, Affinia may be constrained in its ability to move product

into export markets or to switch resources into producing alternative products. 

Industry capacity

Overall, U.S. producers’ capacity for brake rotors was constant at *** units from 2002 to 2006;

however, in 2007, total capacity declined to *** brake rotors. During that time, production of brake

rotors declined steadily; thus, U.S. producers’ capacity utilization decreased during the period of review. 

Capacity utilization declined from *** percent in 2002 to *** percent in 2007. Based on these data, U.S.

producers have some available capacity which could be used to increase the production of brake rotors in

the event of a price increase.4

Alternative markets

Exports of brake rotors, as a share of total shipments, ranged from a low of *** percent in 2006,

to a high of *** percent in 2005, and was *** percent in 2007. These export shares suggest that U.S.

producers have some ability to shift sales to alternative markets in response to changes in demand. 

Questionnaire responses from the two U.S. producers indicate that they believe it would be ***,

particularly in the short-term. *** noted that, since ***. *** reported that the ability to shift between

different markets is “***.”

Inventory levels

U.S. producers’ inventories of aftermarket brake rotors, as a share of total shipments, ranged from

a low of *** percent in 2006 to a high of *** percent in 2007; other than the one-year low in 2006, U.S.

producers’ inventories (as a percent of total shipments) were greater than *** percent in all years. ***

inventories such as these could be used to respond quickly to an increase in demand for brake rotors.
 5

 Chinese brake rotor producers were asked to discuss how easily they could shift sales of aftermarket brake

rotors between the U.S. market and alternative country markets. Several firms noted that it would be difficult;

information from Chinese suppliers on the ease of shifting sales in discussed in Part IV of this report.

II-3

Production alternatives

*** reported that they do not have the ability to manufacture other products using the same

equipment, machinery, and workforce as are used in the production of aftermarket brake rotors. ***

reported that they do not produce other products on the same equipment and machinery and/or use the

same production and related workers as for aftermarket brake rotors. ***, however, did note that, in

addition to aftermarket brake rotors, they produce brake rotors for the OEM market. Affinia later

reported ***.

Subject Imports from China 

Based on information provided by 11 producers of brake rotors from China, suppliers of imports

of brake rotors from China have the ability to respond to changes in demand with moderate changes in the

quantity shipped to the U.S. market. Supply responsiveness is enhanced by some available capacity, but

is constrained by small non-U.S. export markets and a small home market and relatively low level of

existing inventories. 

Industry capacity

Reported capacity of the responding Chinese producers increased steadily from 13.7 million

brake rotors in 2002 to 39.8 million brake rotors in 2007. During that period, production of brake rotors

in China also increased steadily, rising from 9.1 million brake rotors in 2002 to 35.6 million brake rotors

in 2007. Since production generally rose faster than capacity, capacity utilization rates also increased

over the period of review. Capacity utilization for responding Chinese producers increased from 66.3

percent in 2002 to 89.7 percent in 2007. This level of available capacity indicates that responding

Chinese producers have a limited ability to increase production and shipments to the United States in

response to changes in price.

Alternative markets

Available data from the responding Chinese producers of brake rotors indicates that the U.S.

market has been the largest outlet for Chinese producers. Export shipments to the United States, as a

share of total shipments, accounted for between 79.8 and 92.2 percent during 2002 to 2007. Shipments of

brake rotors to the Chinese home market varied from a high of 12.4 percent of total shipments (in 2005)

to a low of 1.5 percent (in 2007). Exports to non-U.S. markets accounted for between 6.3 and 10.9

percent of total shipments during the period of review. The relatively small size of the Chinese home

market and non-U.S. export markets suggests that responding Chinese brake rotor producers may be

somewhat constrained in their ability to shift sales to the United States in response to changes in price.5

Inventory levels

Responding Chinese producers’ inventory levels, as a percentage of total production, fluctuated

from a low of 2.1 percent (in 2007) to a high of 9.3 percent (in 2005). The most recent annual data

suggest that Chinese producers have a limited ability to use available inventories to increase shipments to

the United States as a short-term response to changes in relative prices. 
 6 Response of Coalition, August 21, 2007, p. 29.

 7

 Ibid., p. 5.

 8

 Federal-Mogul noted that brake rotors today are a lot thinner and have essentially become discardable, throwaway parts and, as a result, the demand for aftermarket brake rotors has increased substantially (hearing transcript,

p. 14 (Hughes)).

 9

 One importer reported that demand was unchanged.

 10 The remaining purchaser reported that demand was unchanged.

 11 Producers and importers were asked to discuss demand in the United States and, if known, demand outside the

United States. None of the responding producers provided specific comments on demand outside of the U.S. market. 

(continued...)

II-4

Production alternatives

None of the responding producers of brake rotors from China reported that they produced other

products using the same equipment or machinery as is used in the production of aftermarket brake rotors. 

Furthermore, none of the responding Chinese producers reported being able to switch production between

aftermarket brake rotors and other products in response to a relative price change in aftermarket brake

rotors in the United States or elsewhere. 

U.S. Demand

Based on available information, consumers are likely to respond to changes in the price of

aftermarket brake rotors with relatively small changes in their purchases of aftermarket brake rotors. 

Demand Characteristics

The demand for brake rotors is driven by a number of factors, such as the quantity of vehicles in

use, average miles driven per year, average age of vehicles, and the driving behavior of the population.6

Aftermarket brake rotors are available in both premium and economy grades. According to domestic

producers, the premium line tends to be more focused on trucks, APVs, SUVs, and premium passenger

car applications, while the economy line tends to be concentrated in high-volume applications.7

 ***

stated that demand for brake rotors in the United States is up significantly as brake rotors have become

more of a “disposable commodity.”8

 According to ***, technicians have realized that it is now easier and

less costly to replace brake rotors than to resurface them. Available data indicate that apparent

consumption in the United States for brake rotors increased irregularly during 2002-07, rising *** percent

from *** brake rotors to *** brake rotors in that time.

When asked if U.S. demand for aftermarket brake rotors had changed since January 1, 2002, ***

reported that demand in the United States had increased. As noted above, *** stated that demand has

increased as more technicians and customers have shifted from resurfacing more expensive premium

grade brake rotors to replacing them with new lower-priced economy type brake rotors. Similarly, ***

reported that as the cost of new brake rotors decreased, fewer people reconditioned rotors by resurfacing

them on a lathe; rather, customers chose to replace brake rotors and as such new unit sales have increased. 

All but one of the responding importers *** stated that demand for brake rotors in the United States has

increased since 1997.9

 Many of these importers noted that there are more vehicles on the road and that

vehicles are lasting longer, thus, extending the service life. Of the 11 responding purchasers, 10 noted

that demand for brake rotors in the U.S. market has increased.10 These firms also noted the increased

number of vehicles on the road and the fact that vehicles are lasting longer as explanations for the

increase in demand.11
 11 (...continued)

One importer, ***, noted that “demand for rotors in emerging markets throughout the world will be especially high.” 

Purchasers were specifically asked to comment on demand for brake rotors outside of the United States. Eight of the

nine responding purchasers reported that they anticipated increases in demand outside the U.S. market; these firms

cited the same reasons as they did for anticipated growth in demand in the U.S. market (i.e., increased number of

vehicles and longer life of vehicles).

 12 One importer, ***, estimated that demand would grow by approximately 3 percent per year.

 13 One Chinese producer and exporter of aftermarket brake rotors stated that “the home market in China is

booming” (hearing transcript, p. 32 (Zhang). It also noted that while the Chinese market is still smaller than the

U.S. market for after market brake rotors, specialists believe that it is poised to become one of the world’s largest

automotive markets in the near future (hearing transcript, pp. 32-33 (Zhang)).

 14 At the hearing, CWD, a purchaser and importer of aftermarket brake rotors, noted that there are differences

between aftermarket and OEM brake rotors in that OEM product holds much tighter tolerances than anything used in

the aftermarket (hearing transcript, p. 46 (Hughes)). CWD also noted that “nobody in the after market uses the

exact OEM tolerances because it would raise the cost of the brake rotor substantially over what the market would

bear (Ibid.). Federal-Mogul also commented on OEM and aftermarket brake rotors at the hearing and it reported that

there are considerable differences in the specifications and the tolerances that are held on OEM products (hearing

transcript, pp. 47-48 (Wapplehorst)).

II-5

Producers, importers, and purchasers were also asked about anticipated future changes in

demand. *** stated that it did anticipate continued growth in demand for brake rotors, noting that supply

in China has increased substantially and will continue in order to meet the needs of customers who want

to replace (instead of resurface) brake rotors at a low cost. *** stated that it did not anticipate any

changes in demand. Importers were also mixed with regard to anticipated changes in demand. Eight of

the responding firms reported that they believed that demand would continue to grow as more new

vehicles enter the market and more vehicles last longer which increases service life.12 Six importers

stated that they did not anticipate any changes in demand for brake rotors. Purchasers were split on future

demand changes, with six reporting that they anticipated growth in demand and five stating that they did

not anticipate any changes. Several purchasers noted that continuation of development/growth in thirdworld countries would help increase global demand. 

Chinese brake rotor producers were also asked to discuss trends in demand in their home market,

the U.S. market, and other markets. While some firms reported that they did not know about demand in

the United States and other markets, all those that did reply noted that demand in the U.S. and other

markets has increased since 1997. All of the responding Chinese producers reported that demand for

brake rotors in the Chinese market had increased.13 These firms all noted the increase in vehicles in China

as an explanation for the increase in demand for brake rotors.

Substitute Products

Virtually all of the responding producers, importers, and purchasers reported that there are no

substitutes for aftermarket brakes. *** and one purchaser both listed OEM brake rotors as a potential

substitute for aftermarket brake rotors.14 In addition, one purchaser, ***, stated that brake drums could

replace brake rotors on some rear-wheel applications.
 15 *** (Posthearing brief of Coalition, p. 9).

 16 Hearing transcript, p. 16 (Hughes).

 17 Ibid.

 18 One purchaser/importer, CWD, reported that it buys all of its premium brake rotors from Italy, Taiwan, and

Brazil (hearing transcript, p. 17 (Hughes)).

II-6

Cost Share

There is one end-use application for aftermarket brake rotors--replacement of brakes in

automobiles. Producers and importers were asked to estimate the share of the total cost of end uses that is

accounted for by the cost of brake rotors. U.S. producers estimated that the cost of brake rotors accounted

for between *** and *** percent of the cost of a brake job. Importers reported a wider range, with eight

importers reporting that the cost of the brake rotors accounted for 100 percent of the cost of a brake job;

one importer estimated the percentage at 25 percent and another estimated 50 percent.

SUBSTITUTABILITY ISSUES

The degree of substitution between domestic and imported aftermarket brake rotors depends upon

such factors as relative prices, quality, and conditions of sale (e.g., availability, price discounts/rebates,

delivery, payment terms, product services, etc.). Based on available data, staff believes that there are

some differences between domestic brake rotors and brake rotors imported from China and that there

appears to be a relatively low to moderate degree of substitution between domestic and Chinese brake

rotors. 

As discussed in Parts I and III of this report, aftermarket brake rotors are available in both

premium grade and economy grade. Available information indicates that Chinese rotors are primarily

economy grade whereas U.S.-produced rotors are primarily premium grade.15 Federal-Mogul reported

that there is very limited competition between premium and economy grade rotors.16 It further noted that

the two products are sold in different segments of the U.S. market with different prices to different

customers.17 According to respondents, it is estimated that sales of premium brake rotors account for

approximately 15 to 20 percent of total sales of aftermarket brake rotors in the U.S. market.18

Factors Affecting Purchasing Decisions

Purchasers were asked to identify the three major factors considered by their firm in deciding

from whom to purchase brake rotors (table II-2). As is seen in the table, purchasers of brake rotors most

frequently reported that quality was the most important factor in their purchasing decision, with seven

firms ranking it as the number one factor; in addition, three other purchasers reported that it was the

second most important factor. Two purchasers reported that price was the most important factor in

purchasing decisions for aftermarket brake rotors, three ranked it second, and five ranked it third. Other

factors listed as one of the top three most important factors include, availability, product range, and

traditional supplier.

Purchasers were asked what characteristics determine the quality of aftermarket brake rotors. 

Factors listed by responding purchasers include meeting or exceeding the OEM standards/specifications,

brand, manufacturer/supplier, good management of supplier, meeting G3000 metallurgical specifications,

disc thickness variation, finish, packaging, surface finish, and historical defect rates. To better assess

quality issues, purchasers were also asked how often domestically produced and Chinese aftermarket 

brake rotors meet minimum quality specifications. Six of eight responding purchasers reported that the 
II-7

Table II-2

Brake rotors: Most important factors in selecting a supplier, as reported by purchasers

Factor First Second Third

Quality 7 3 0

Price 2 3 5

Availability 1 2 4

Product range 1 0 2

Traditional supplier 0 1 0

Source: Compiled from data submitted in response to Commission questionnaires.

U.S. product “always” meets minimum specifications, while the remaining two purchasers reported that

the U.S. product “usually” meets minimum specifications. With regard to Chinese brake rotors, more

than one half (6 of 11 purchasers) reported that the Chinese product “always” meets minimum

specifications while the other half reported that the Chinese product “usually” meets these specifications.

Purchasers were asked if they always, usually, sometimes, or never purchased the lowest priced

brake rotors. Of the responding purchasers, none reported that they always buy the lowest priced product,

two reported that they usually do, seven reported sometimes, and two reported never. Purchasers were

also asked if they purchased brake rotors from one source although a comparable product was available at

a lower price from another source. Eight purchasers reported that they had purchased brake rotors from a

certain source when a comparable product was available at a lower price. Reasons given include

availability, desire to single source, delivery time, order fill time, product certification, product range,

quality, reliability, traditional supplier, and warranty.

Purchasers were asked to rate the importance of 15 factors in their purchasing decisions for brake

rotors (table II-3). All 11 responding purchasers reported that availability and product consistency were

very important in their purchasing decisions for aftermarket brake rotors. Other factors ranked as very

important by a majority of purchasers were delivery terms, delivery time, discounts offered, price, quality

meeting industry standards, quality exceeding industry standards, product range, reliability, and technical

support/service.

Purchasers were asked for a country-by-country comparison of U.S.-produced brake rotors

compared to brake rotors from China and relevant nonsubject countries on the same 15 factors. Results

are shown in table II-4. In general, most responding purchasers found the domestic and Chinese products

to be comparable with regard to availability, delivery terms, extension of credit, lower U.S. transportation

costs, minimum quantity requirements, packaging, product consistency, product range, quality that meets

industry standards, and reliability of supply. The factors where purchasers found some differences and

reported that the U.S. product was superior were delivery time and technical support/service. A couple 

of purchasers found the U.S. product to be superior with regard to delivery terms, transportation costs,

minimum quantity requirements, and quality that exceeds industry standards, and three purchasers found

the Chinese product to be superior with regard to discounts offered. Four of the five responding

purchasers reported that the Chinese product had a lower price.

Purchasers, U.S. producers, and importers were asked if certain grades, types, or sizes of

aftermarket brake rotors were available from a single source. Eight of 10 responding purchasers stated

that there were not certain grades/types/sizes of brake rotors available from a single source. The two

remaining purchasers replied “yes” and noted the availability of premium grades of brake rotors from

Brazil, Japan, and Italy. In addition, purchasers were also asked if they or their customers ever 
II-8

Table II-3

Brake rotors: Importance of purchase factors, as reported by U.S. purchasers

Factor

Very important

Somewhat

important Not important

Number of firms responding

Availability 11 0 0

Delivery terms 6 4 1

Delivery time 7 3 0

Discounts offered 5 2 3

Extension of credit 4 5 1

Minimum quantity requirements 2 3 5

Packaging 3 7 0

Price 7 4 0

Product consistency 11 0 0

Quality meets industry standards 10 1 0

Quality exceeds industry standards 5 1 3

Product range 6 3 1

Reliability of supply 9 2 0

Supplier is a related entity 0 1 10

Technical support/service 5 2 4

U.S. transportation costs 4 2 5

Note.--Not all purchasers responded for each factor.

Source: Compiled from data submitted in response to Commission questionnaires.

specifically order aftermarket brakes from one country in particular over other possible sources of supply. 

Most purchasers (8 of 10) reported “no;” however, two firms replied “yes,” with one noting ordering

European brake rotors for European cars and the other stating that it purchases from any country with the

lowest price.

Purchasers were asked whether buying a product produced in the United States is an important

factor in their firm’s purchases of aftermarket brake rotors. All 11 of the responding purchasers reported

that buying a product produced in the United States is not an important factor in their firm’s purchases of

aftermarket brake rotors.

Purchasers were asked if they required certification or prequalification with respect to the

chemistry, strength, or other performance characteristics of brake rotors. Seven of 11 responding

purchasers reported that they do require their suppliers to be certified before they will purchase brake

rotors from them; the remaining four purchasers reported that they did not have such requirements. All of

the seven firms that do have a certification process reported that 100 percent of their purchases of 

brake rotors must be certified. Purchasers stated that these procedures include metallurgical testing, 
II-9

Table II-4

Brake rotors: Comparisons of product by source country, as reported by purchasers

Factor

U.S. vs. China

SC I

Number of firms responding 

Availability 1 3 1

Delivery terms 2 3 0

Delivery time 4 1 0

Discounts offered 1 1 3

Extension of credit 1 4 0

Lower price1 014

Lower U.S. transportation costs1 230

Minimum quantity requirements 2 3 0

Packaging 0 4 0

Product consistency 1 3 1

Product range 0 4 0

Quality meets industry standards 1 4 0

Quality exceeds industry standards 2 2 1

Reliability of supply 1 4 0

Technical support/service 3 2 0

 1 A rating of “superior” for this category means that the price and/or transportation costs of the U.S. product is

generally lower than for the product from China.

Note.--S=first listed country’s product is superior; C=both countries’ products are comparable; I=first listed country’s

product is inferior. 

Note.--Not all companies gave responses for all factors.

Source: Compiled from data submitted in response to Commission questionnaires.

inspection of machining, review of samples, analysis of financial stability of the supplier, and a matching

of parts drawings against the OEM drawing. Purchasers also noted the factors that they consider when

they are considering a new supplier; these include quality, price, reliability, industry reputation, new part

introduction time, product range offered, and fill rate (time to fill an order). Estimates of the time

necessary for certification/qualification ranged from 1 to 6 months. Purchasers were also asked if any

suppliers failed in their attempt to qualify and only two of the responding firms replied “yes;” these two

firms noted two suppliers from China and one from India.

Purchasers were asked about the extent to which they and their customers make purchasing

decisions based on specific producers or countries of origin; responses are presented in table II-5. With

regard to knowledge of the producer of the brake rotor, it appears that this is more important to the

purchaser than it is to the purchaser’s customer. Also, while a couple of purchasers reported that the

country of origin is always important in their purchasing decisions, most others reported that it was not a

major factor. *** reported that it is important to know the country of origin of the brake rotors as it is
II-10

Table II-5

Brake rotors: The role of producer and country of origin in purchaser and customer decisions

Item Always Usually Sometimes Never

Purchaser makes decision based on producer 4 2 2 2

Purchaser’s customer makes decision based on

producer 1 1 5 4

Purchaser makes decision based on country 3 1 1 6

Purchaser’s customer makes decision based on

country 2 1 2 6

Source: Compiled from data submitted in response to Commission questionnaires.

important to understand the quality of the product. Another purchaser, ***, noted that country of origin

is important as it wants European parts for European cars.

Comparisons of Domestic Products, Subject Imports, and Nonsubject Imports

U.S. producers, importers, and purchasers were asked to report how frequently brake rotors from

different countries are able to be used in the same applications (table II-6). If responding firms reported

that products from different countries were not always used in the same application, they were asked to

explain why. In general, results indicate that brake rotors from both subject and nonsubject countries are

generally interchangeable with brake rotors produced in the United States, with *** reporting that

domestic and imported brake rotors are *** interchangeable. The vast majority of responding importers

reported that domestic and Chinese brake rotors are “always” or “frequently” used interchangeably. 

Similarly, the majority of responding purchasers reported that domestic and imported brake rotors are

“always” interchangeable. 

Table II-6

Brake rotors: U.S. producers’, importers’, and purchasers’ perceived degree of interchangeability

of products produced in the United States and other countries1

Country

comparison

U.S. producers U.S. importers U.S. purchasers

AFSN0AFSN0AFSN0

U.S. vs. China *** *** *** *** *** 12 3 1 1 0 8 0 1 1 0

U.S. vs. nonsubject *** *** *** *** *** 11 111060113

China vs. nonsubject *** *** *** *** *** 11 111060102

 1 U.S. producers, importers, and purchasers were asked if brake rotors produced in the United States and in

other countries are used interchangeably.

Note.--“A” = Always, “F” = Frequently, “S” = Sometimes, “N” = Never, and “0” = No familiarity.

Source: Compiled from data submitted in response to Commission questionnaires.
II-11

U.S. producers and importers were asked to assess how often differences other than price were

significant in sales of brake rotors from the United States, subject countries, or nonsubject countries (table

II-7). U.S. producers *** reported that differences are *** a factor whereas *** reported that they are

*** a factor. *** stated that technical support is important to its customers and that if the brake rotors are

coming from another country this type of support may not be as available as it is when the product is

produced in the United States. For importers there was a mixed response, with three reporting that there

are “always” differences between domestic and Chinese product, four reporting “frequently,” two

reporting “sometimes,” and one reporting “never.” The responses of importers for the domestic product

compared to the nonsubject product and for the Chinese product compared to the nonsubject-country

product were similar to their responses for the U.S. product compared to the Chinese product. Importers

noted factors such as availability, quality, technical support, and reliability as differences between the

products. Two importers, ***, both noted the fact that both Affinia and Federal-Mogul have moved

operations overseas, and that thus, the availability of U.S.-produced product is extremely limited.

Table II-7

Brake rotors: U.S. producers’ and importers’ perceptions concerning the importance of non-price

differences in purchases of brake rotors from the United States and other countries1

Country comparison

U.S. producers U.S. importers

AFSN0AFSN0

U.S. vs. China *** *** *** *** *** 4 4 2 2 0

U.S. vs. nonsubject *** *** *** *** *** 25220

China vs. nonsubject *** *** *** *** *** 33220

 1 U.S. producers and importers were asked if differences other than price between brake rotors produced in the

United States and in other countries are a significant factor in their firm’s sales of the product.

Note.--“A” = Always, “F” = Frequently, “S” = Sometimes, “N” = Never, and “0” = No familiarity.

Source: Compiled from data submitted in response to Commission questionnaires.

ELASTICITY ESTIMATES

U.S. Supply Elasticity

The domestic supply elasticity for brake rotors measures the sensitivity of quantity supplied by

U.S. producers to changes in the U.S. market price of brake rotors. The elasticity of domestic supply

depends on several factors including the level of excess capacity, the ease with which producers can alter

capacity, producers’ ability to shift to production of other products, the existence of inventories, and the

availability of alternate markets for U.S.-produced brake rotors. Analysis of these factors earlier indicates

that the U.S. industry is likely to be able to increase or decrease shipments to the U.S. market; an estimate

in the range of 4 to 6 is suggested. The supply elasticity is enhanced by the existence of available unused

capacity and moderate inventories, but is hampered by the inability to switch production to or from other

products, and the inability to move sales to or from alternative markets.
 19 The substitution elasticity measures the responsiveness of the relative U.S. consumption levels of the subject

imports and U.S. like products to changes in their relative prices. This reflects how easily purchasers switch from

the U.S. product to the subject products (or vice versa) when prices change.

II-12

Subject Supply Elasticity

Based on information from eleven producers of brake rotors in China that represent

approximately 28 percent of total Chinese brake rotor producing capacity, an estimate in the range of 3 to

6 is suggested for the supply elasticity of brake rotors from China. 

U.S. Demand Elasticity

The U.S. demand elasticity for brake rotors measures the sensitivity of the overall quantity

demanded to a change in the U.S. market price of brake rotors. This estimate depends on factors

discussed earlier such as the existence, availability, and commercial viability of substitute products, as

well as the component share of the brake rotors in the production of any downstream products. Based on

available information, the U.S. demand elasticity for brake rotors is likely to be in the range of 0.50 to

1.0. 

Substitution Elasticity

The elasticity of substitution depends upon the extent of product differentiation between the

domestic and imported products.19 Product differentiation, in turn, depends upon such factors as quality

(e.g., taste, appearance, etc.) and conditions of sale (availability, sales terms/discounts/promotions, etc.).

Based on available information, the elasticity of substitution between U.S.-produced brake rotors and

imported brake rotors from China is likely to be in the range of 1 to 3.
 1

 CWD provided data for StopTech, which it acquired in April 2006, and for PPG (aka Power Slot), which it

acquired in October 2007. *** its product does not compete with the domestic like product and that it operates in a

different segment of the U.S. market.

 2

 ***. Posthearing brief of Federal-Mogul, pp. 24-25.

 3

 Staff sent the Commission’s producer questionnaire to Brembo on three separate dates (via overnight courier,

email, and fax) in an attempt to solicit a response. As indicated earlier in Part I of this report, staff believes that

Brembo is no longer manufacturing rotors in the United States.

 4

 The Commission sent a producer questionnaire to Coleman Machine on March 21, 2008, after counsel for the

Chinese interested parties identified this firm as a possible domestic producer. No response to the questionnaire has

been received from Coleman Machine.

 5

 The Commission sent a producer questionnaire to Performance Friction on March 21, 2008, after counsel for

the Chinese interested parties identified this firm as a possible domestic producer. No response to the questionnaire

has been received from Performance Friction, although legal counsel for the firm filed two letters with the

Commission on the company’s behalf (dated April 14, 2008 and April 24, 2008) stating that Performance Friction is

a producer of the domestic like product. Subsequent to receipt of these letters, staff contacted legal counsel for

Performance Friction on two separate occasions (via phone and email) attempting to solicit a producer questionnaire

response from the firm.

 6

 Staff transmitted the producer questionnaire to PowerStop on two separate dates (via overnight courier and fax)

but has received no response to its request. ***.

 7 Response of Coalition, August 21, 2007, pp. 20-21.

 8 Prehearing brief of Chinese respondents, p. 14, Posthearing brief of Chinese respondents, p. Q-8.

III-1

PART III: CONDITION OF THE U.S. INDUSTRY

U.S. PRODUCERS

The Commission sent producer questionnaires to Affinia and Federal-Mogul, who claim that they

were the only known domestic producers of aftermarket brake rotors during the review period. Both

Affinia and Federal-Mogul provided responses to the Commission’s questionnaire. 

The Commission also sent producer questionnaires to eight additional firms identified by parties

as possible domestic producers of aftermarket rotors. Four of these firms (Waupaca, CWD,1

 Wilwood,

and Honeywell) provided questionnaire responses. Waupaca, an independent foundry that produces raw

castings in the United States, and CWD, a specialized finisher for the “high performance” market,

provided certain information in response to the Commission’s producer questionnaire. Wilwood, on the

other hand, *** was not a domestic producer of aftermarket brake rotors.2

 Although *** did not provide

a response to the Commission’s producer questionnaire, *** not a domestic producer of aftermarket brake

rotors. The following four firms did not provide a response to the Commission’s request for information: 

Brembo,3

 Coleman Machine,4 Performance Friction,5 and PowerStop.6

As noted earlier in this report, the parties to this review have argued that these additional eight

firms should not be considered part of the domestic industry that produces aftermarket brake rotors. The

Coalition indicated in its response to the Commission’s notice of institution that the companies that are

small, low-volume, niche-market producers of specialty products (such as for the racing industry) simply

perform specialized machining on purchased or imported rotors and should not be considered part of the

domestic industry.7

 The Chinese Respondents argued that foundries, such as Waupaca, do not qualify as

domestic producers of aftermarket brake rotors because they do not perform machining in the United

States. They also submitted that other producers of specialty products that have been identified as

potential producers also do not appear to qualify as domestic producers of aftermarket brake rotors.8

Information in this section of the staff report is based on the questionnaire responses of Affinia

and Federal-Mogul. These two producers indicated that they accounted for essentially all U.S. production
 9 Response of Coalition, August 21, 2007, p. 20.

 10 Affinia added that it is “***.” Posthearing brief of Coalition, p. 14. However, Federal-Mogul and the Chinese

respondents in this review have argued that Affinia is on the verge of eliminating all of its aftermarket brake rotor

manufacturing in the United States and that their production data “reflects a company in the process of *** its

manufacturing operations – not a company with a “***” to remain a U.S. producer of aftermarket brake rotors.” In

fact, they indicated that Affinia’s intent to sell its Waupaca facility is publicly known. Prehearing brief of Chinese

respondents, p. 3; Posthearing brief of Chinese respondents, p. Q-4; Prehearing brief of Federal-Mogul, pp. 5 and

16; Posthearing brief of Federal-Mogul, pp. 4 and 8; and Hearing transcript, pp. 29 (Woo), 66 (Vander Schaaf), and

106 (Mintzer). Affinia indicated that “***.” Email from *** to ***, May 7, 2008.

 11 Because of double-counting issues, a presentation of aggregate data for all four firms is not provided.

 12 Most of the auctioned machining equipment was sold for scrap and some of the auctioned foundry equipment

was shipped to Mexico. Hearing transcript, p. 121 (Wappelhorst).

III-2

of aftermarket brake rotors during 2007.9

 As indicated earlier in this report, Federal-Mogul permanently

shut down its domestic production facilities in September 2007. Affinia, on the other hand, reported that

it “is in active production at its Litchfield plant . . .” and that it has a long-term lease on its Waupaca

plant.10 Additional information received from Waupaca, an independent foundry that produces raw

castings, and CWD, a specialized finisher of rotors for the “high performance” market, is also presented

separately, as appropriate.11

U.S. PRODUCERS’ CAPACITY, PRODUCTION, AND CAPACITY UTILIZATION

Data on U.S. producers’ capacity, production, and capacity utilization for aftermarket brake

rotors during 2002-07 are presented in table III-1. Neither Affinia nor Federal-Mogul has ***. Likewise,

both Waupaca and CWD reported in their producer questionnaire responses that they have ***. 

Capacity data provided by Federal-Mogul indicate a constant level of capacity during the 2002-

06 period and a decline in 2007, commensurate with the permanent closure of its St. Louis, MO, facility

in September 2007. The company indicated that approximately one-half of the machining equipment at

its production facility was transferred to its OEM rotor production facility in China and that the rest of the

foundry and machining equipment was sold at auction in December 2007. The Federal-Mogul facility is

currently up for sale.12

Table III-1

Brake rotors: U.S. capacity, production, and capacity utilization, 2002-07

* * * * * * *

Affinia’s capacity data also indicate a constant level of capacity to produce aftermarket brake

rotors from 2002 to 2006, but a *** drop in the firm’s capacity to produce was reported for 2007. This

drop is explained by Affinia’s permanent closure of its facilities in North East, PA, and McHenry, IL, in

October and December 2006, respectively. The closure of the McHenry facility displaced *** employees

and the closure of the North East facility displaced *** employees. ***.

 Waupaca reported that its combined foundry capacity for OEM and aftermarket brake rotors

(based on operating ***) increased ***. Waupaca indicated in its questionnaire response that “***.” 

CWD reported that the capacity of its specialty machining operation in the United States *** to meet the

growth in demand for its high-performance rotors.

The Commission asked domestic producers to report constraints on their capacity to produce

aftermarket brake rotors. Federal-Mogul did not provide a response to the Commission’s question. 

Affinia responded to the Commission’s question as follows: “***.” Waupaca indicated that the limit of
 13 Federal-Mogul asserted that the capacity data reported by Affinia is “***” and that the firm’s capacity

utilization is *** reported based on information concerning capacity calculations provided by Federal-Mogul and the

Chinese aftermarket brake rotor producers. Prehearing brief of Federal-Mogul, p. 27.

 14 The volume of castings Federal-Mogul produced in relation to the volume of aftermarket brake rotors it

produced for each annual period examined is as follows: ***.

 15 Hearing transcript, pp. 16 (Hughes), 48 (Wappelhorst), 66-67 (Hughes), and 123 (Wappelhorst).

 16 Posthearing brief of Chinese respondents, pp. Q-10-Q-11; Prehearing brief of Federal-Mogul, p. 22;

Posthearing brief of Federal-Mogul, p. 33.

III-3

its capacity to produce raw castings is constrained by its ***. CWD reported that its *** set the limit on

its capacity to produce specialty rotors for the high-performance market.

As shown in table III-1, U.S. producers’ capacity to produce aftermarket brake rotors remained at

the same level from 2002 to 2006 but fell by *** percent in 2007. Domestic producers’ capacity was ***

below apparent U.S. consumption of brake rotors in each of the years 2002-07, and by 2007 was

equivalent to only *** percent of consumption. Domestic production of aftermarket brake rotors,

however, fell during each annual period examined during this review, with an overall decline of ***

percent from 2002 to 2007. *** drop in domestic production was reported during the final annual period

examined, when it fell by *** percent from 2006 to 2007. The trend in the level of capacity utilization

reported by the domestic producers of aftermarket brake rotors tracked the trend in the level of domestic

production, falling in each annual period examined.

In its questionnaire response, Affinia reported that its current annual capacity (2008) to produce

aftermarket brake rotors is *** rotors, down from *** rotors in 2007 and *** reported for previous annual

periods.13 The Commission also asked Affinia to provide first quarter 2008 production data for its

domestically produced aftermarket brake rotors. The firm indicated that, as of March 21, 2008, it had

produced *** aftermarket rotors in 2008. Based on its annual capacity of *** rotors, Affinia’s capacity

utilization during the first 12 weeks of 2008 was *** percent, down from *** percent during calendar

year 2007.

The Commission asked domestic producers to indicate the extent to which they have produced

their own castings used in the production of their aftermarket brake rotors and the extent to which they

have performed the machining on the brake rotors they produced at any time since 2002. Federal-Mogul

reported that, during 2002-07, it ***.14 Federal-Mogul indicated ***. ***, Affinia reported that it ***. 

Waupaca reported that during 2002-07, it *** and CWD reported that it is ***.

Premium vs. Economy Aftermarket Brake Rotors

As described earlier in Part I of this report, the production of premium rotors requires very

sophisticated, expensive machinery and additional labor. These premium rotors require a much closer

tolerance on the braking surface than economy rotors and are, therefore, subject to greater quality control

standards in the casting and machining process. In addition, the raw castings for the premium rotors

require a much tighter range of chemistry and hardness and a higher tensile strength than the economy

rotors.15 In appearance, the premium rotors are much thicker and heavier and are sold to “safetyconscious users, for high-end vehicle application, and for fleet sales.”16 Citing hearing testimony in the

original investigation, the Chinese respondents in this review indicated that about 80 percent of brake

rotors sold in the U.S. market at that time were premium rotors and about 20 percent were economy

rotors. Respondents also reported that due to changes in engineering and vehicle weight requirements

over the past decade, the U.S. demand for thinner, lighter economy rotors has gradually increased while

the demand for thicker, heavier premium rotors has fallen. They estimated that “premium-grade sales in
 17 Posthearing brief of Chinese respondents, p. Q-11; Prehearing brief of Federal-Mogul, pp. 7 and 21.

 18 Prehearing brief of Federal-Mogul, p. 8.

 19 Posthearing brief of Federal-Mogul, p. 32.

 20 Prehearing brief of Chinese respondents, p. 23.

 21 Posthearing brief of Coalition, p. 9.

 22 Both Affinia and Federal-Mogul also indicated in their questionnaire response that ***.

 23 Affinia later reported ***. Email from *** to ***, May 7, 2008.

 24 CWD responded ***. On the other hand, Waupaca indicated ***. Waupaca also indicated that it “***.” By

2007, Waupaca’s raw castings production for aftermarket brake rotors fell to ***. Other raw casting products that

Waupaca produced in the facilities in which it produced raw castings for aftermarket brake rotors and their

corresponding share of total net sales during 2007 are as follows: ***.

 25 Email from *** to ***, May 7, 2008.

III-4

the U.S. market today represent roughly 15 to 20 percent of total sales of aftermarket brake rotors.”17

Federal-Mogul submitted that the “U.S. producers, which had historically focused their market on the

premium segment, continued to lose ground to imports as they were unable to establish market share in

the economy segment of the market.”18 As such, Chinese rotors are primarily economy grade and U.S.-

produced rotors are primarily premium grade.19

The Chinese respondents argued that “Affinia *** in the United States and now is *** brake

rotors.”20 Affinia, however, reported that it “has the ability to produce domestically nearly any brake

rotor sold today . . .” It added that, in addition to premium rotors, it domestically produces rotors for

“new applications and low-volume applications” and that ***.21

Alternative Products

The Commission asked domestic producers to report production of other products on the same

equipment and machinery, and/or using the same production and related workers employed to produce

aftermarket brake rotors. ***.22 23 Both producers, however, did indicate that, in addition to aftermarket

brake rotors, they produced brake rotors for the OEM market.24

In a response to staff inquiry concerning its reported capacity data, Affinia reported that ***. The

firm added that ***.25

 Data on domestic producers’ capacity, production, and capacity utilization for OEM and

aftermarket brake rotors combined are presented in table III-2. The combined OEM and aftermarket

brake rotor data for domestic capacity, production, and capacity utilization generally followed similar

trends as reported for aftermarket brake rotors alone, with the exception of the increase in the combined

production and capacity utilization data from 2002 to 2003. Capacity utilization of the combined data

was *** that reported for aftermarket brake rotors alone during 2002-04 but was *** during the

remainder of the annual periods examined.

Table III-2

OEM and aftermarket brake rotors: U.S. producers’ capacity, production, and capacity utilization

for OEM and aftermarket brake rotors combined, 2002-07

* * * * * * *
 26 CWD indicated in its questionnaire response that ***. In its questionnaire response, Waupaca stated the

following: “***.”

 27 Email from *** to ***, March 26, 2008.

 28 Ibid.

III-5

Changes Experienced in Operations

Domestic producers were asked to indicate whether their firm had experienced any changes in the

character of their operations or organization relating to the production of aftermarket brake rotors since

April 17, 1997 (the date on which the antidumping duty order under review became effective), such as

plant openings, relocations, expansions, acquisitions, consolidations, closures, or prolonged shutdowns

because of strikes or equipment failure; curtailment of production because of shortages of materials or

other reasons; expansion of import operations; supply arrangements with suppliers in China; or any other

change. Both Affinia and Federal-Mogul indicated that they had experienced closures and had ***. 

Additionally, Affinia indicated that it had opened a new plant and ***. CWD reported ***; Waupaca

reported ***. The firms’ complete descriptions of the timing, nature, and significance of such changes

experienced since April 17, 1997 (supplemented with additional publicly available information), are

presented in table III-3.

Table III-3

Brake rotors: Changes in the character of U.S. operations

* * * * * * *

Anticipated Changes in Operations

The Commission requested that domestic producers provide a copy of their company business

plans or other internal documents that describe, discuss, or analyze expected future market conditions for

aftermarket brake rotors.26 Affinia indicated that it had “***.”27 Affinia, however, provided the

Commission with a copy of a ***.28 Federal-Mogul, on the other hand, provided ***. In that document,

Federal-Mogul briefly outlined the market situation for brake rotors and drums as follows:

* * * * * * *

*** anticipate future changes in the character of their operations relating to the production of

aftermarket brake rotors. Affinia described *** as follows: “***.” Federal-Mogul simply indicated that

it “{c}losed {its} manufacturing facility in St. Louis, MO in September of 2007 ***.” CWD reported in

its questionnaire response *** relating to the production of “high-performance” rotors. Waupaca, on the

other hand, indicated *** relating to the production of raw castings for aftermarket brake rotors. In its

response, Waupaca described *** as follows: 

* * * * * * *
 29 Because of double-counting issues, the shipment data for “high-performance” rotors provided by CWD and raw

castings provided by Waupaca are not aggregated with Affinia’s and Federal-Mogul’s combined data presented in

table III-4 and are not included in the discussion of U.S. producers’ aggregate shipments in the text in this section of

the report. The shipment data provided by CWD and Waupaca are presented and discussed separately in notes to

table III-4.

 30 The reported inventory data are provided by Affinia and Federal-Mogul; CWD reported *** inventories of its

high performance product (see notes to table III-5) and Waupaca reported that *** inventories of the raw castings

that it produces. In its questionnaire response, Waupaca indicated the following: “***.”

III-6

U.S. PRODUCERS’ DOMESTIC SHIPMENTS, 

COMPANY TRANSFERS, AND EXPORT SHIPMENTS

Data on domestic producers’ shipments of aftermarket brake rotors are presented in table III-4.29

*** (i.e., greater than *** percent) of Affinia’s and Federal-Mogul’s combined shipments of aftermarket

brake rotors were to the U.S. commercial market during the annual periods examined in this review. On

the basis of quantity, the two U.S. producers’ combined U.S. commercial shipments increased from 2002

to 2003, but fell in the remaining periods examined. On the basis of value, their combined U.S.

commercial shipments fell in every period examined in this review, with the exception of *** increase in

2006. Average unit values of their combined commercial shipments fell from $*** per rotor in 2002 to

$*** per rotor in 2004, then increased to a high of $*** per rotor in 2006, before falling in 2007 to $***

per rotor. ***. In addition, the shipment data provided by Affinia are estimates rather than actual data. 

The firm provided the following explanation as to why estimates rather than actual data were provided: 

“***.”

Table III-4

Brake rotors: U.S. producers’ shipments, by types and producers, 2002-07

* * * * * * *

Export shipments, on the other hand, accounted for *** share of combined total shipments of

Affinia and Federal-Mogul, ranging from *** to *** percent during the periods examined. Nevertheless,

export shipments by the two U.S. producers (on the basis of quantity and value), as well as unit values of

export shipments, followed a remarkably similar trend as their combined U.S. commercial shipments. 

Affinia reported that its principal export market was ***.

U.S. PRODUCERS’ INVENTORIES

Data collected in these reviews on domestic producers’ end-of-period inventories of aftermarket

brake rotors are presented in table III-5.30 The domestic industry’s year-end inventories of aftermarket

brake rotors fell overall during the period for which data were collected from *** rotors in 2002 to ***

rotors in 2007, with the lowest level of inventories reported for the entire period occurring in *** at ***

rotors. Despite a decline in the absolute quantity of inventories, the ratios of inventories to production,

inventories to U.S. shipments, and inventories to total shipments fluctuated widely during the periods

examined because of the *** drop in production and shipments during that same time period. These

ratios ranged from a low of *** percent in 2006 (ratio of inventories to total shipments) to a high of ***

percent in 2007 (ratio of inventories to U.S. shipments).
 31 Affinia reported that it purchases brake rotors from entities related to MAT Holdings Inc., but it reported that

all such purchases are on an arms-length basis. Posthearing brief of Coalition, p. 5.

 32 Posthearing brief of Coalition, p. 6.

 33 The Chinese respondents argued that Affinia’s interest in keeping the antidumping duty order on certain

imports of aftermarket brake rotors is to “***.” Prehearing brief of Chinese respondents, pp. 1 and 11. Likewise,

Federal-Mogul argued that the antidumping duty order “simply gives Affinia an opportunity to protect its

relationships with certain U.S. importers of Chinese rotors at the expense of other U.S. importers of Chinese rotors.” 

Prehearing brief of Federal-Mogul, pp. 2 and 30.

 34 In the Coalition response to the Commission’s notice of institution in this review, Federal-Mogul reported that

***. Affinia reported that ***. Response of the Coalition, August 21, 2007, p. 3. However, *** research and

development expenses in their producer questionnaire responses in this review (see table III-11).

III-7

Table III-5

Brake rotors: U.S. producers’ end-of-period inventories, 2002-07

* * * * * * *

U.S. PRODUCERS’ IMPORTS AND PURCHASES

*** Affinia and Federal-Mogul reported ***. Although neither firm reported ***, Affinia has

***.31 ***’s imports and purchases are presented in table III-6. 

In addition, CWD reported that ***. ***’s imports and purchases are also presented in table III6. Waupaca indicated that ***.

Table III-6

Brake rotors: U.S. producers’ imports and purchases, 2002-07

* * * * * * *

***. It also reported that during this same time period it ***. The reason cited by Affinia ***. 

Affinia also indicated that its “decision to import *** is ***.” It added that it was “***” to the domestic

production of aftermarket brake rotors.32 The firm’s ratio of purchases of subject aftermarket brake rotors

to U.S. production increased from *** percent in 2002 to *** percent in 2006. During 2007, the total

purchases of subject aftermarket rotors by Affinia ***.33 

* * * * * * *

***, both Affinia and Federal-Mogul reported in their response to the Commission’s notice of

institution in this review that they have purchased imports to be able to maintain and supplement their

domestic production and that they are “very committed to their domestic production and have no plans to

cease production.” They added that both companies have invested heavily in their manufacturing

facilities, manufacturing equipment, and research and development of aftermarket rotors “to maintain

their status as innovative and high technology domestic producers.”34 During 2007, Affinia’s purchases

of subject imports from China accounted for *** percent of reported exports of subject merchandise from

China to the United States and Federal-Mogul’s *** imports of subject product from China accounted for

*** percent of subject exports. ***, the two firms together accounted for *** percent of reported exports

of subject merchandise from China to the United States during 2007. The ***-percent figure is

undoubtedly overstated to the extent that some subject Chinese producers did not respond to the

Commission’s questionnaire.
 35 Response of Chinese respondents, August 21, 2007, pp. 8 and 19-20.

 36 Employment data provided by Waupaca and CWD are provided in the notes to table III-7.

 37 Email from Leslie A. Glick to Mary Messer, May 5, 2008, and posthearing brief of Federal-Mogul, p. 35.

 38 *** (U.S.-manufactured, direct imports, and purchases). From 2002 to 2007, *** percent, respectively, of all

of Affinia’s rotors. See May 1, 2008 e-mail from Leslie Glick, counsel to Affinia, and associated worksheet. 

Although *** provided trade (shipment) data for 2002-07, it could only provide financial data for 2004-07. See

March 27, 2008 e-mail from Sydney Mintzer, counsel to Federal-Mogul. Federal-Mogul’s data for *** are based

upon its ***; this accounts for the differences between the 2002-03 shipment data in table III-4 and 2002-03 sales

(continued...)

III-8

In their response to the Commission’s notice of institution in this review, the Chinese respondents

argued that, since 1997, both Affinia and Federal-Mogul have chosen to “reorient their operations to

focus their production in China” and have “invested hundreds of millions of dollars in China, and have

become among the largest importers of subject merchandise in the United States.” In reality, they argued,

“Affinia and Federal-Mogul advocate the continuation of the antidumping duty order in an effort to shield

their import operations from other import competition.” Chinese respondents also indicated that, in

Commerce’s current review of the order, U.S. importer CWD requested that Commerce “exercise its

authority to disregard the responses submitted by Affinia and Federal-Mogul provided that they (i)

control, and are related to, Chinese producers/exporters of subject merchandise, and (ii) are two of the

largest importers of subject merchandise in the United States.” Therefore, CWD argued, because there

has been no other substantive response submission showing interest in continuation of the antidumping

duty order filed by legitimate domestic interested parties in Commerce’s review proceeding, it is

advocating that Commerce should exercise its authority and revoke the antidumping duty order.35

U.S. PRODUCERS’ EMPLOYMENT, WAGES, AND PRODUCTIVITY

The U.S. producers’ aggregate employment data for aftermarket brake rotors are presented in

table III-7.36 The number of production-related workers (“PRWs”) employed by U.S. producers Affinia

and Federal-Mogul combined declined overall by *** percent between 2002 and 2007. Over this same

period, hours worked, wages paid, and productivity decreased, while unit labor costs increased. Although

hourly wages increased consistently from 2002 to 2005, they fell in 2007 to a level comparable to that

reported in 2002.

Table III-7

Brake rotors: U.S. producers’ employment-related indicators, 2002-07 

* * * * * * *

There are *** in productivity and unit labor costs between Affinia and Federal-Mogul. Staff

contacted counsel for those firms for clarification, but neither counsel was able to provide an explanation,

in part because of the inability to discuss the other firm’s business proprietary information with their

clients.37

FINANCIAL EXPERIENCE OF U.S. PRODUCERS

Background

Affinia and Federal-Mogul, which together accounted for virtually all U.S. production of

aftermarket brake rotors from 2002 to 2007, provided financial information on their operations.38 Both
 38 (...continued)

data in tables III-8 and III-9. 

 39 These related party transfers are to *** affiliates in ***. Since the trade (shipment) section of the U.S.

producer questionnaire instructs producers to report *** shipments, *** are properly classified as *** and not *** in

table III-4.

 40 *** unit sales value *** percent in 2007 as its 2002-06 average product mix of *** brake rotors and *** brake

rotors changed to *** brake rotors and *** brake rotors. See May 1, 2008 e-mail from ***.

III-9

companies have fiscal years ending December 31. Affinia, a producer of automotive and light truck

replacement parts, had overall net sales of $2.1 billion in 2007, approximately half of which were brakes

and brake parts. Federal-Mogul, a producer of vehicular parts, components, and modules and systems to

customers in the automotive, small engine, heavy-duty, marine, railroad, aerospace, and industrial

markets, had overall net sales of $6.9 billion in 2007. Aftermarket brake rotors are part of FederalMogul’s global aftermarket segment, which includes many other products, such as engines and engine

parts; the aftermarket segment accounted for $2.7 billion of Federal-Mogul’s net sales in 2007. ***

reported ***; the unit sales values of these *** were the ***.39

StopTech and ThyssenKrupp Waupaca also submitted domestic producer questionnaire

responses. Since StopTech’s operations consist of ***, and since ThyssenKrupp Waupaca is a producer

of ***, their data were not included with Affinia’s and Federal-Mogul’s.

Operations on Aftermarket Brake Rotors

Aggregate income-and-loss data for the U.S. producers are presented in table III-8. To

summarize, the domestic aftermarket brake rotor industry went from being ***, to being ***, and then

***. From 2002 to 2003 the industry enjoyed essentially stable net sales quantities and values, declining

costs, and *** operating profit margins. The situation changed in 2004, as the absolute value of operating

costs (cost of goods sold and SG&A expenses combined) increased by approximately *** while net sales

values ***. On a per-unit basis, unit sales revenues *** while unit operating costs *** per brake rotor. 

As a result, the *** operating income reported in 2003 *** in 2004. Over the next two years the situation

continued to worsen – sales quantities and values ***, unit operating costs increased by approximately

$** per brake rotor *** than unit sales prices *** each period, and all levels and all measures of

profitability declined. 

Table III-8

Aftermarket brake rotors: Results of operations of U.S. producers, fiscal years 2002-07

* * * * * * *

The industry reported *** results in 2007. Sales quantity and value both decreased by *** to ***

percent, and the *** operating profit ***, as Affinia closed two of its four U.S. production facilities in

2006 and Federal-Mogul closed its only U.S. production facility in September 2007.

Selected company-by-company data are presented in table III-9. While *** in every period

except 2007, the trends for the two companies were quite similar. With regard to profitability, both

companies reported stable (***) profits in 2002 and 2003, decreased profitability from 2004 through 2006

(***), and then *** decreases in 2007. *** reported decreasing sales quantities and values in virtually

every period. Finally, although both producers’ unit sales values generally increased from period to

period,40 both producers’ unit operating costs increased even more.
III-10

Table III-9

Aftermarket brake rotors: Results of operations of U.S. producers, fiscal years 2002-07

* * * * * * *

The variance analysis showing the effects of prices and volume on the producers’ sales of

aftermarket brake rotors, and of costs and volume on their total cost, is shown in table III-10. The

analysis indicates that the decrease in profitability from 2002 to 2007 was the result of decreased sales

volume and increases in per-unit costs and expenses. This is consistent with the underlying data in table

III-8 – the sales volume that drove the industry’s profitability in 2002 had decreased by approximately

*** percent by 2007, unit operating costs increased by over $*** per brake rotor, and unit sales prices

were ***. While the validity of the results of the variance analysis is tempered to some extent because of

***, Commission staff believes the results still reasonably depict the effects of changes in average prices

and volume on the producers’ net sales, and the results still reasonably depict the effects of changes in

average costs/expenses and volume on the producers’ total costs and expenses.

Table III-10

Aftermarket brake rotors: Variance analysis, fiscal years 2002-07

* * * * * * *

Capital Expenditures and Research and Development Expenses,

Assets and Return on Investment

 The capital expenditures and research and development (R&D) expenses are presented in table

III-11. Capital expenditures were ***. *** R&D expenses.

The domestic aftermarket brake rotor industry’s assets and its return on investment are also

presented in table III-11. The decrease in the total value of assets from 2002 to 2007 essentially mirrored

the decline in sales values. At the same time, the return on the assets followed the same trend as

operating income.

Table III-11

Aftermarket brake rotors: Capital expenditures, research and development expenses, assets, and

return on assets, 2002-07

* * * * * * *
 1

 Eighteen of the firms reported that they did not import aftermarket brake rotors during the period for which data

were collected and 60 firms did not respond to the Commission’s questionnaire. Questionnaires addressed to 24

firms were returned to the Commission as undeliverable because the companies could not be located and/or no valid

contact information for the firms was found. Staff has made multiple attempts to deliver the Commission’s importer

questionnaire (by fax, email, overnight courier, and U.S. Postal Service) to the companies that have not provided a

response to the Commission’s request in this review.

 2

 As indicated in Part I of this report, the HTS statistical reporting number specific to rotors was created in July

2004; however, this narrower HTS category is still a broader product grouping than the subject merchandise in that it

includes not only OEM brake rotors but also aftermarket brake rotors produced by Chinese firms not subject to the

antidumping duty order. Regardless, the Coalition indicated in its response to the Commission’s notice of institution

in this review that it believes that the large majority of imports entering the United States under this HTS number are

aftermarket rotors because, until recently, OEMs would generally not buy rotors produced in China. Response of

Coalition, August 21, 2007, p. 8. Therefore, the coverage figures indicated appear to be a reasonable estimate,

although they may be somewhat understated.

IV-1

PART IV: U.S. IMPORTS AND THE SUBJECT INDUSTRY IN CHINA

U.S. IMPORTERS

The Commission sent importer questionnaires to 123 firms identified as possible U.S. importers

of aftermarket brake rotors between 2002 and 2007, and received usable data from 21 of the firms.1

Based on official Commerce statistics for imports of brake rotors (both OEM and aftermarket), the

importers’ questionnaire data accounted for 36.3 percent of total U.S. imports during 2007 and 57.5

percent of total imports from China in 2007.2

 Based on export data provided in foreign producer

questionnaire responses, the importer questionnaire data accounted for 67.6 percent of total exports of

subject merchandise from China to the United States in 2007.

None of the 21 importers responding to the Commission’s importer questionnaire reported

entering or withdrawing aftermarket brake rotors from foreign trade zones or bonded warehouses. In

addition, no importers reported imports of brake rotors under the temporary importation under bond

program.

The Commission requested that importers provide a copy of their company business plans or

other internal documents that describe, discuss, or analyze expected future market conditions for

aftermarket brake rotors. Only four importers (***) indicated that their firm maintained such documents. 

*** originally indicated in its questionnaire response that “{t}hese documents are confidential and are not

provided to external parties.” However, it later provided the Commission with a copy of a ***. In that

presentation, *** indicated that the current economic conditions are affecting motorists’ behavior and that

although there are more vehicles in operation, the miles that are driven are declining. ***, the contents of

which are included in Part III of this report. Importer *** provided as an attachment to its importer

questionnaire response a brief description of the firm. In its summary, the firm stated the following: 

“***.” *** indicated that they do not maintain such internal documents, but *** stated “Our business

plan adapts to available demands” and *** stated “Our business plan is subject to market conditions. 

Original plan would not meet the ever changing market conditions.” Importer *** provided an outline

entitled “Potential Brake Rotor Issues 2008.” In that document, the company indicated that the supply of

brake rotors is expected to be tight in 2008 because of the following: (1) short supply of raw materials,

(2) foundries being shuttered for environmental concerns, (3) an increase in European demand for

aftermarket brake rotors, and (4) an annual increase of 30 percent in Chinese consumption of aftermarket

brake rotors. The company also indicated that shipment delays are expected for 2008 because of U.S.

port labor talks and general port congestion and because of anticipated factory closures in the Beijing area

during the Summer Olympic Games. *** also noted that prices for Chinese aftermarket brake rotors are

expected to rise by 25-30 percent during 2008 because of expected changes in the following conditions: 
 3

 Brake drums are included in the same “basket” HTS classification as brake rotors only in the periods prior to

July 2004.

IV-2

(1) exchange rate changes, (2) anticipated increases in the price of raw materials, (3) anticipated

elimination of Chinese government rebates, (4) anticipated increases in freight costs, and (5) anticipated

increases in global energy prices.

The Commission requested U.S. importers to indicate whether or not their firm had experienced

any plant openings, relocations, expansions, acquisitions, consolidations, closures, or prolonged

shutdowns because of strikes or equipment failure; or any other change in the character of their operations

or organization relating to the importation of aftermarket brake rotors since 1997 (the year in which the

antidumping duty order under review became effective). The Commission also asked U.S. importers if

they anticipate any changes in the character of their operations or organization relating to the importation

of aftermarket brake rotors in the future. Eleven U.S. importers indicated that their firms had experienced

such changes and five of these same U.S. importers indicated that they also anticipate future changes. 

The information provided by these 11 U.S. importers is presented in table IV-1.

Table IV-1

Brake rotors: Reported and anticipated changes in the character of U.S. importer operations, by

firms

* * * * * * *

U.S. IMPORTS

Subject imports of aftermarket brake rotors from China and from all nonsubject sources for the

annual periods 2002-07 appear in table IV-2. Because of the relatively low response rate by U.S.

importers to the Commission’s questionnaire, the import quantity data for the subject merchandise

presented in the body of this report are based on the quantity of exports to the United States as reported in

foreign producer questionnaire responses; the import value data presented for the subject merchandise

was constructed using the unit value data provided in the U.S. importer questionnaire responses. Import 

data presented for nonsubject rotors are based on official Commerce statistics. Therefore, the subject

import data are understated to the extent that some Chinese producers subject to the antidumping duty

order did not respond to the Commission’s questionnaire and the nonsubject import data are overstated to

the extent that the official statistics include merchandise that does not meet Commerce’s scope

description of aftermarket brake rotors (i.e., OEM brake rotors, rotors that fall outside the defined

physical parameters, and brake drums3

). Official Commerce import statistics are also presented in their

entirety separately at table C-2 in appendix C. 

The quantity of subject imports from China increased overall from 7.7 million rotors in 2002 to

33.1 million rotors in 2007. The ratio of U.S. imports of subject aftermarket brake rotors from China to

U.S. production of aftermarket brake rotors increased throughout the period examined, with the greatest

increase reported during the latter annual periods. In fact, during 2002, subject imports from China were

slightly less than *** the level of domestic production of aftermarket brake rotors; however, by 2007,

subject imports climbed to a level that was more than *** times the level of domestic production. 

Between 2002 and 2007, the share of total U.S. imports held by subject imports (on the basis of

quantity) increased overall from a low of 13.9 percent in 2002 to a high of 39.5 percent in 2007. The

share of imports of aftermarket brake rotors from other (nonsubject) Chinese sources fluctuated during 
IV-3

Table IV-2

Brake rotors: U.S. imports, by sources, 2002-07

Source

Calendar year

2002 2003 2004 2005 2006 2007

Quantity (1,000 rotors)

China (subject)1 7,703 12,882 14,961 17,743 23,796 33,073

China (nonsubject)2 5,549 6,951 3,809 4,570 7,738 13,492

Other sources3 42,300 38,075 32,259 39,658 41,691 37,170

Total 55,551 57,908 51,030 61,971 73,225 83,735

Value (1,000 dollars)

4

China (subject)1 48,884 78,204 99,807 158,808 168,307 275,184

China (nonsubject)2 32,822 44,162 26,952 32,027 51,310 100,468

Other sources3 592,580 565,743 523,590 472,382 538,848 507,633

Total 674,286 688,109 650,348 663,217 758,465 883,285

Unit value (per rotor)

China (subject)1 $6.35 $6.07 $6.67 $8.95 $7.07 $8.32

China (nonsubject)2 5.91 6.35 7.08 7.01 6.63 7.45

Other sources3 14.01 14.86 16.23 11.91 12.92 13.66

Total 12.14 11.88 12.74 10.70 10.36 10.55

Table continued on the following page.
IV-4

Table IV-2--Continued

Brake rotors: U.S. imports, by sources, 2002-07

Source

Calendar year

2002 2003 2004 2005 2006 2007

Share of quantity (percent)

China (subject)1 13.9 22.2 29.3 28.6 32.5 39.5

China (nonsubject)2 10.0 12.0 7.5 7.4 10.6 16.1

Other sources3 76.1 65.8 63.2 64.0 56.9 44.4

Total 100.0 100.0 100.0 100.0 100.0 100.0

Share of value (percent)

China (subject)1 7.2 11.4 15.3 23.9 22.2 31.2

China (nonsubject)2 4.9 6.4 4.1 4.8 6.8 11.4

Other sources3 87.9 82.2 80.5 71.2 71.0 57.5

Total 100.0 100.0 100.0 100.0 100.0 100.0

Ratio of import quantity to U.S. production (percent)

China (subject)1 *** *** *** *** *** ***

China (nonsubject)2 *** *** *** *** *** ***

Other sources3 *** *** *** *** *** ***

Total *** *** *** *** *** ***

 1 Subject Chinese manufacturers identified in U.S. importer questionnaires were the following: ***.

 2

 Nonsubject Chinese manufacturers identified in U.S. importer questionnaires were the following: ***.

 3

 Other sources identified in U.S. importer questionnaires were the following: ***. The leading nonsubject

country suppliers for imports entering the United States under HTS 8708.30.5030 during 2007 (and their shares of

the total quantity of U.S. imports of all brake rotors) were as follows: Mexico (19.2 percent); Canada (7.2 percent);

Germany (3.8 percent); Brazil and Taiwan (2.0 percent each); and Japan (1.8 percent). 

 4

 Landed, duty-paid.

Source: “China (subject)” data are compiled from data submitted in response to Commission questionnaires. 

Specifically, “China (subject)” import quantity is the quantity of exports to the United States reported by subject

Chinese producers in the Commission’s foreign producer questionnaires. “China (subject)” import value is

constructed by multiplying the average unit value of U.S. imports of subject merchandise compiled from the

Commission’s importer questionnaire responses by this quantity. “China (nonsubject)” and “other sources” are

compiled from official Commerce import statistics.

the period examined, ranging from a low of 7.4 percent in 2005 to a high of 16.1 percent in 2007. The

share of total imports held by all sources other than China generally fell from a high of 76.1 percent in

2002 to a low of 44.4 percent in 2007.

The unit values of subject imports of aftermarket brake rotors from China fluctuated upward

throughout the period, from $6.35 per rotor in 2002 to $8.32 per rotor in 2007. These unit values were

consistently lower than the unit values reported for all sources other than China, but were higher than the

unit values reported for nonsubject Chinese rotors during 2002 and 2005-07.

The Commission requested U.S. importers to provide information concerning the timing, the

quantities involved, and the manufacturers of the U.S. imports of aftermarket brake rotors from China for
IV-5

which they had arranged for delivery after December 31, 2007. Eight importers indicated that they had

no such arrangements; however, 13 importers reported arrangements for the importation of aftermarket

brake rotors from China for delivery after December 31, 2007, and provided the information concerning

such imports. The information they provided in response to the Commission’s request is presented in

table IV-3. As indicated from the information in the table, the 13 responding U.S. importers reported that

together they had already arranged or received delivery of approximately 4.6 million rotors from Chinese

companies subject to the antidumping duty order after December 31, 2007.

Table IV-3

Brake rotors: U.S. imports from China arranged for delivery after December 31, 2007, by importing

firm

* * * * * * *

As shown in table IV-2, 44.4 percent of aftermarket brake rotors imported into the United States

during 2007 were from nonsubject countries, 16.1 percent were from nonsubject Chinese sources (i.e.,

from Chinese companies excluded from the antidumping duty order), and 39.5 percent were from subject

Chinese sources. Importer questionnaire responses also confirm that, during the period for which data

were collected, a substantial portion of U.S. imports of aftermarket brake rotors from China were

nonsubject product that had been produced/exported by Chinese firms excluded from the antidumping

duty order by Commerce. Nonsubject sources of imports identified in importer questionnaire responses

(other than excluded Chinese firms) include the following: ***. According to official import statistics,

the leading nonsubject country suppliers for imports entering the United States under HTS 8708.30.5030

during 2007 (and their shares of the total quantity of U.S. imports of all brake rotors) were as follows: 

Mexico (19.2 percent); Canada (7.2 percent); Germany (3.8 percent); Brazil and Taiwan (2.0 percent

each); and Japan (1.8 percent). Imports from all countries other than China accounted for 38.9 percent of

total U.S. imports of all brake rotors during 2007 (according to official import statistics).

U.S. IMPORTERS’ INVENTORIES

Data relating to U.S. importers’ inventories of aftermarket brake rotors are presented in 

table IV-4. As the data presented in table IV-4 illustrate, inventories of subject imports from China

increased by more than *** from 2002 to 2007, with the largest quantity increases reported during the last

two annual periods examined. Inventories of nonsubject imports (i.e., imports from nonsubject Chinese

firms and nonsubject countries combined) also increased overall from 2002 to 2007, but were *** (about

*** percent) of the total inventories held by U.S. importers of the subject merchandise. 

Relative to import quantity, inventories of subject imports accounted for a substantial share,

especially during the latter annual periods examined. The ratio of subject inventories to subject import

quantity increased steadily from a low of *** percent in 2002 to a high of *** percent in 2007. 

Inventories of imports from nonsubject countries were relatively high in comparison to the import

quantity, ranging from *** percent to *** percent throughout the period examined; inventories of imports

from nonsubject firms in China, on the other hand, accounted for much smaller shares of import quantity,

ranging from *** percent to *** percent.
 4 Certain Brake Drums and Rotors From China: Investigation No. 731-TA-744 (Final), USITC Publication 3035,

April 1997, p. VII-1.

 5 Staff Report, June 28, 2002 (INV-Z-099), pp. I-31 - I-32.

IV-6

Table IV-4

Brake rotors: U.S. importers’ end-of-period inventories of imports, by source, 2002-07

Item

Calendar year

2002 2003 2004 2005 2006 2007

China (subject imports):

 Inventories (1,000 rotors) 694 1,271 1,447 1,515 4,915 6,582

 Ratio to imports (percent) 10.5 11.2 11.5 12.3 25.9 29.4

 Ratio to U.S. shipments of

 imports (percent) 12.2 16.6 14.8 15.5 35.5 37.5

China (nonsubject imports):

 Inventories (1,000 rotors) *** *** *** *** *** ***

 Ratio to imports (percent) *** *** *** *** *** ***

 Ratio to U.S. shipments of 

 imports (percent) *** *** *** *** *** ***

Other sources:

 Inventories (1,000 rotors) 197 283 379 497 517 654

 Ratio to imports (percent) 60.9 53.7 54.6 59.1 72.0 58.8

 Ratio to U.S. shipments of 

 imports (percent) 78.4 64.8 64.4 71.0 75.5 70.1

All sources:

 Inventories (1,000 rotors) *** *** *** *** *** ***

 Ratio to imports (percent) *** *** *** *** *** ***

 Ratio to U.S. shipments of

 imports (percent) *** *** *** *** *** ***

Source: Compiled from data submitted in response to Commission questionnaires.

THE SUBJECT INDUSTRY IN CHINA

In the original investigation, 11 Chinese firms provided brake rotor information to the

Commission; these firms consisted of those manufacturers/exporters that had received company-specific

rates during Commerce’s original dumping investigation. Aggregate exports to the United States for the

11 firms accounted, however, for only 29.4 percent of subject brake rotor imports from China in 1995.4

 

In its response to the Commission’s notice of institution in the first review, the Coalition

identified 29 companies that had produced subject rotors in China that were ultimately sold in the United

States. Further, citing data maintained by Customs, the Commission reported in the first review that the

number of Chinese firms manufacturing brake rotors (and drums) rose from *** in 1999 to *** in 2001.5
 6 Response of Coalition, August 21, 2007, pp. 24-26.

 7

 Only certain combinations of the five mentioned manufacturers/exporters were in fact excluded from the order.

 8 Response of Chinese respondents, August 21, 2007, pp. 15-17.

 9

 Valid contact information was not available for the following 17 additional Chinese firms identified by

interested parties as producers of aftermarket brake rotors: Beijing Xingchangyuan Automobile Fittings Corp. Ltd.;

Changzhi Automotive Parts Factory; Jilin Provincial Machinery and Equipment; Laizhou Auto Brake Co. Ltd.;

Laizhou Magnetic Iron Powder Clutch Factory; Longjing Walking Tractor Works Foreign Trade Import & Export

Corp.; Longkou Bohai Machinery Corp.; Longkou Longji Machinery Co., Ltd.; Qingdao Golrich Autoparts Co., Ltd;

Shanxi Fengkun Metallurgical Ltd., Co.; Shenyang Jinde Machinery Co., Ltd.; Shenyang Railway Brake Factory

Foundry Branch; Xianfen Hengtai Brake System Co.; Xuzhou Canal Machinery; Yangtze Machinery Corp.; Yantai

Mouping Hongli Machinery Factory; and Zhuzhou Torch Spark Plug Co.

 10 The coverage figure presented is somewhat understated. As noted previously, the HTS category under which

the subject merchandise is categorized is a broader product grouping, including OEM brake rotors and other

products outside the physical parameters of Commerce’s scope definition.

 11 Laizhou CAPCO, which is excluded from the antidumping duty order, considers itself to be the largest

producer of aftermarket brake rotors in China. Prehearing brief of Chinese respondents, p. 32.

IV-7

The Coalition listed in its response in this second five-year review 38 companies that have

produced and/or exported subject rotors in China that were ultimately sold in the United States.6

 The

Chinese respondents indicated in their response that the 12 Chinese producers responding to the

Commission’s notice of institution in this current review continue to export subject merchandise to the

United States. Chinese respondents also listed Affinia’s and Federal-Mogul’s related entities in China

that they believe continue to export subject merchandise to the United States. In addition, they listed 10

Chinese companies that have exported subject merchandise to the United States in the past and they listed

the following 5 Chinese firms that were excluded from the original 1997 antidumping duty order: China

National Machinery Import & Export Co. (“CAIEC”); CAPCO; Shenyang Honbase and Laizhou Luyuan;

China National Machinery and Equipment Import & Export (Xinjiang) Corp. (“Xinjiang”); and Zibo

Botai.7

 The Chinese respondents reported that these excluded Chinese companies have continued to ship

aftermarket brake rotors to the United States that are not subject to the order but otherwise meet the

physical description of the merchandise within the scope of the order.8

The Commission’s foreign producer questionnaire was sent to 34 firms in China for which valid

contact information was obtained.9

 In the current review, 13 subject Chinese producers of aftermarket

brake rotors provided data in response to the Commission’s questionnaire. Based on official Commerce

statistics for U.S. imports of brake rotors, these Chinese producers’ exports to the United States accounted

for at least 73.6 percent of total subject U.S. imports of brake rotors from China in 2007.10 Table IV-5

presents a summary of information regarding the 13 reporting Chinese producers of subject aftermarket

brake rotors. Only one of the responding Chinese producers indicated that it had a related U.S. firm that

imported subject merchandise into the United States. *** reported that it is related to U.S. importer ***. 

In addition, Chinese producer *** indicated that it was related to ***, a producer of aftermarket brake

rotors in Taiwan. As the information in table IV-5 shows, *** was *** the largest reporting producer of

subject rotors in China during 2007, accounting for slightly more than *** of all reported subject

aftermarket brake rotor production in China and exports of such merchandise to the United States.11 

Table IV-5

Brake rotors: Reporting Chinese producers, shares of reported production, and shares of

reported exports to the United States, 2007

* * * * * * *
 12 There were no data concerning the Chinese rotor industry available during the Commission’s expedited first

five-year review of the antidumping duty order. Staff Report, June 28, 2002 (INV-Z-099), p. I-31.

 13 The remaining 11 responding Chinese producers indicated in their questionnaire responses that their firms do

not maintain such documents. Several of these firms explained that they do not need such business plans for

aftermarket brake rotors because they are small companies that have stable relationships with established clients.

 14 These two firms are ***.

IV-8

Table IV-6 presents comparative information available from the original investigation and this

second review.12

Table IV-6

Brake rotors: Comparison of select subject Chinese industry data, 1995 and 2007

Item 1995 2007

Capacity (1,000 rotors) 2,833 39,758

Production (1,000 rotors) 2,419 35,648

Capacity utilization (percent) 85.4 89.7

Exports/shipments (percent) 82.7 98.5

Inventories/shipments (percent) 4.3 2.1

Note.--Data for 1995 were provided by 11 Chinese producers, whose aggregate exports to the United States

accounted for 29.4 percent of subject brake rotor imports from China in 1995. Data for 2007 were provided by 13

Chinese producers, whose aggregate exports to the United States accounted for 73.6 percent of subject brake

rotor imports from China in 2007.

Source: Staff Report, March 18, 1997 (INV-U-020), table VII-2; and Commission questionnaire responses.

Data provided by 13 Chinese subject producers concerning their aftermarket brake rotor

operations for 2002-07 are presented in table IV-7. Regarding alternative products, none of the

responding Chinese producers of subject aftermarket brake rotors indicated that they have produced, or

anticipate producing in the future, other products on the same equipment and machinery or using the same

production employees used in the production of aftermarket brake rotors. In fact, all responding Chinese

firms reported that 100 percent of their firms’ total sales in the most recent fiscal year was represented by

sales of aftermarket brake rotors.

Only 2 of the 13 responding Chinese producers reported that they had a business plan or internal

document that describes, discusses, or analyzes expected future market conditions for aftermarket brake

rotors.13 Both firms provided the Commission with the requested documents.14 In the minutes of its

annual company meeting *** reported that in the face of the more intense market competition, it had

planned to “actively develop new markets and broaden the sales markets.” In particular it stated the

following: “We shall especially focus on the business development in our home market & the European

market and look for the new business market. Our goal is to increase the sales revenue more than 20

percent.” *** provided a series of data showing the company’s forecasted capacity and production

estimates for 2008-12. These data indicate that the company has no plans to increase capacity from the

level reported in 2007 and that it forecasts its production level to drop slightly during 2010-12.

The data presented in table IV-7 show that the combined capacity to produce subject aftermarket

brake rotors in China increased consistently from 13.7 million rotors in 2002 to 39.8 million rotors in

2007. Nine of the responding 13 Chinese producers providing capacity data reported such increases in 
IV-9

Table IV-7

Brake rotors: Subject Chinese capacity, production, shipments, and inventories, 2002-07

Item

Calendar year

2002 2003 2004 2005 2006 2007

Quantity (1,000 rotors)

Capacity 13,732 19,752 24,752 31,910 34,458 39,758

Production 9,098 15,016 18,460 23,670 28,083 35,648

End-of-period inventories 506 663 785 2,207 972 744

Shipments:

 Internal consumption 0 0 0 0 0 0

 Commercial home market shipments 315 927 1,455 2,766 2,851 545

 Exports to--

 United States 7,703 12,882 14,961 17,743 23,796 33,073

 European Union 5 31 151 259 877 471

 Asia 51 179 485 623 681 682

 All other markets 927 840 1,286 856 1,112 1,103

 Total exports 8,686 13,932 16,883 19,481 26,466 35,330

 Total shipments 9,001 14,859 18,338 22,247 29,317 35,874

Value ($1,000)

Commercial shipments:

 Home market 1,496 3,244 7,003 10,100 14,167 3,381

 Exports to--

 United States 40,867 65,487 87,012 108,177 154,066 232,745

 European Union 19 102 728 2,368 5,483 3,526

 Asia 171 689 2,451 4,209 4,241 5,679

 All other markets 3,692 3,682 6,468 4,472 5,808 6,056

 Total exports 44,749 69,960 96,659 119,226 169,598 248,006

 Total commercial shipments 46,245 73,204 103,662 129,326 183,765 251,387

Table continued on following page.
IV-10

Table IV-7--Continued

Brake rotors: Subject Chinese capacity, production, shipments, and inventories, 2002-07

Item

Calendar year

2002 2003 2004 2005 2006 2007

Unit value (per rotor)

Commercial shipments:

 Home market $4.75 $3.50 $4.81 $3.65 $4.97 $6.20

 Exports to--

 United States 5.31 5.08 5.82 6.10 6.47 7.04

 European Union 3.80 3.29 4.82 9.14 6.25 7.49

 Asia 3.35 3.85 5.05 6.76 6.22 8.33

 All other markets 3.98 4.38 5.03 5.23 5.22 5.49

 Total exports 5.15 5.02 5.73 6.12 6.41 7.02

 Total commercial shipments 5.14 4.93 5.65 5.81 6.27 7.01

Ratios and shares (percent)

Capacity utilization 66.3 76.0 74.6 74.2 81.5 89.7

Inventories to production 5.6 4.4 4.2 9.3 3.5 2.1

Inventories to total shipments 5.6 4.5 4.3 9.9 3.3 2.1

Share of total quantity of:

 Internal consumption 0.0 0.0 0.0 0.0 0.0 0.0

 Home market 3.5 6.2 7.9 12.4 9.7 1.5

 Exports to--

 United States 85.6 86.7 81.6 79.8 81.2 92.2

 European Union 0.1 0.2 0.8 1.2 3.0 1.3

 Asia 0.6 1.2 2.6 2.8 2.3 1.9

 All other markets 10.3 5.7 7.0 3.8 3.8 3.1

 Total exports 96.5 93.8 92.1 87.6 90.3 98.5

Source: Compiled from data submitted in response to Commission questionnaires.

their capacity to produce rotors, two of which included the opening of new facilities. Four of the

responding Chinese producers indicated that their increases in reported capacity were explained by the

acquisition of new equipment, whereas three indicated that their increases were due to increases in

production efficiencies. Other reasons for the reported increases included changes in the availability of

raw material and changes in “labors & assets.” Furthermore, Chinese producers indicated that the supply

of raw material, especially the supply of steel scrap and coke, the labor supply, the size of the facility, and

technical constraints set the limit on their production capacity. One Chinese producer explained that the

production of brake rotors is a labor-intensive process, yet there has been a shortage in the labor supply

and the cost of labor has increased.
 15 Posthearing brief of Federal-Mogul, p. 41.

 16 Posthearing brief of Chinese respondents, p. Q-28.

IV-11

The Commission asked Chinese producers to indicate whether or not they had experienced any

plant openings, relocations, expansions, acquisitions, consolidations, closures, or prolonged shutdowns

because of strikes or equipment failure; curtailment of production because of shortages of materials; or

any other change in the character of their operations or organization relating to the production of

aftermarket brake rotors since 1997 (the year in which the antidumping duty order under review became

effective). Eight Chinese producers indicated that they had experienced no such changes in the character

of their operations and five firms indicated that such changes had occurred. None of the 13 responding

Chinese producers indicated that they anticipated any change in the character of operations in the future.

Details concerning the changes in the character of operations reported by these five firms are presented in

table IV-8.

Table IV-8

Brake rotors: Reported changes in the character of operations reported by subject Chinese

producers

* * * * * * *

The Commission asked the Chinese producers if they had any plans to add, expand, curtail, or

shut down production capacity and/or production of aftermarket brake rotors in China in the future. None

of the Chinese producers indicated that they had any such plans. The subject Chinese rotor producers

reported that their brake rotor capacity is based on operating *** hours per week, *** weeks per year. 

Total shipments of aftermarket brake rotors by Chinese producers subject to the antidumping duty

order increased throughout the period examined. By 2007, total shipments were almost four times greater

than they were in 2002. Shipments to the home market by the Chinese producers steadily increased from

2002 to 2006, but dropped off considerably in 2007. Concerning the decline in Chinese home market

shipments in 2007, Federal-Mogul stated the following:

the decline in home market shipments reflects the fact that the Chinese exporters

reporting data to the Commission are the ones capable of exporting to the United States. 

For those companies, a shift in U.S. demand created in an incentive to satisfy that

demand in the U.S. market. However, there are a number of Chinese producers of

aftermarket rotors who simply are not capable of exporting to the United States. Those

companies, in all likelihood, increased their shipments in the Chinese market to meet

growing demand there.15 

The Chinese producers’ exports to the United States, which increased from 7.7 million rotors in 2002 to

33.1 million rotors in 2007, accounted for the vast majority of the firms’ total shipments of aftermarket

brake rotors, ranging from a low of 79.8 percent of total shipments in 2005 to a high of 92.2 percent in

2007. The Chinese respondents argued that the increase in subject exports of aftermarket brake rotors to

the United States in 2007 “was atypical.” They explained that “U.S. importers and purchasers resorted to

purchase brake rotor quantities that they would have otherwise not purchased in that year” because of the

talk of “tight supply from China, combined with inflationary raw material costs in China.” They further

noted that “Chinese sales to the United States are expected to decline because of increasing exports to the

European market and to China’s home market.”16

The Commission asked producers of aftermarket brake rotors in China and importers of subject

merchandise to identify tariff or non-tariff barriers to trade (for example, antidumping or countervailing
 17 It reported that the European Union assesses a 4.5-percent duty on brake rotors, Canada assesses a 6-percent

duty, Mexico assesses a 7-percent duty in addition to the value added tax of 17 percent, and both Argentina and

Brazil assess an 18-percent duty in addition to taxes of 24.5 percent and 31.25 percent, respectively. Response of

Coalition, August 21, 2007, p. 31.

 18 Ibid.

 19 The remaining three Chinese producers indicated that the question was not applicable to them because they did

not sell rotors to the home market. 

 20 Three producers indicated that the question was not applicable, one indicated that it did not know whether there

had been any significant changes, and one did not provide a response.

 21 Three producers indicated that the question was not applicable to their firm because they do not supply rotors to

the Chinese home market.

IV-12

duty findings or remedies, tariffs, quotas, or regulatory barriers) concerning their exports of aftermarket

brake rotors to countries other than the United States. The Commission also asked the firms to identify

ongoing investigations in countries other than the United States that could result in tariff or non-tariff

barriers to trade for their exports of aftermarket brake rotors. None of the Chinese producers or U.S.

importers of the subject merchandise responding to the Commission’s questionnaire indicated that there

were such barriers to trade in countries other than the United States. However, in its response to the

Commission’s notice of institution in this review, the Coalition noted that brake rotors entering the United

States are assessed a regular duty of 2.5 percent ad valorem, whereas other destinations, such as

Argentina, Brazil, Canada, the European Union, and Mexico, assess much higher import duties on brake

rotors.17 The Coalition argued that these relatively high regular duties imposed on imports of aftermarket

brake rotors by other countries increase the likelihood that the subject rotors produced in China will be

diverted to the U.S. market.18

The ability of producers in China to shift sales between the U.S. market and alternative country

markets may be moderated by existing relationships with current customers. Eleven of the 13 responding

producers in China reported in their foreign producer questionnaire responses that they have long-term

contracts and/or relationships with existing customers, which make it difficult to shift sales of aftermarket

brake rotors between the U.S. market and alternative country markets. In addition, two Chinese

producers noted that it is difficult to shift sales between the U.S. market and alternative country markets

due to the different rotor models required in the different country markets. One of the 13 responding

Chinese producers simply indicated that the question is not applicable because it does not sell aftermarket

brake rotors in third-country markets.

The Commission asked producers of aftermarket brake rotors in China whether there are

significant differences in the product range, product mix, and marketing of aftermarket brake rotors sold

in their home market compared with the rotors sold to the United States and to third-country markets. 

Ten of 13 responding producers indicated that there are significant differences. The same 10 producers

also reported that the rotors sold in their home market are not interchangeable with the rotors sold to the

United States and to third-country markets because the models of the cars sold in the Chinese market are

different from the car models sold in the United States and other countries, requiring different models of

brake rotors. One producer explained, however, that some of the brake rotors destined for both Europe

and the United States are interchangeable because the same model cars are sold in both markets (e.g.,

BMW and Mercedes-Benz).19 Eight producers indicated that there have been no significant changes in

the product range, product mix, or marketing of the aftermarket brake rotors in the home market, the U.S.

market, or the third-country markets;20 nine producers reported that there are no such changes anticipated

in the future and one Chinese producer stated the following concerning such anticipated changes: “China

is a developing market and would be very big in the near future. We will pay much attention in the home

market in the future. It will become one of the largest auto parts markets in the near future.”21
 1

 These estimates are based on HTS statistical reporting number 8708.30.5030.

 2

 Information from U.S. producers is based on questionnaire responses from Affinia and Federal-Mogul and is for

their sales during the period of review; since Federal-Mogul is no longer producing aftermarket brake rotors in the

United States, its responses do not apply for future sales. 

V-1

PART V: PRICING AND RELATED INFORMATION

FACTORS AFFECTING PRICING

Raw Materials

The primary raw material used in the production of brake rotors is gray iron. Available data for

ferrrous scrap indicates that while prices paid have fluctuated since 2002, they have increased

substantially during 2007 (figure V-1). Over the period January 2002 to March 2008, prices for ferrous

scrap rose from $68.46 per gross ton to $329.33 per gross ton. 

U.S. producers and importers were asked to discuss any changes in raw material prices and the

extent to which any changes have affected the prices for brake rotors. *** reported that raw material and

energy costs have increased dramatically in the last 12 months in both the United States and in China; it

expects this trend to continue as the Chinese economy grows. *** reported that Chinese companies that

are making brake rotors are also buying more of the raw materials and are driving up the world market

prices on commodities such as pig iron and scrap steel. *** noted that prices of brake rotors have been

affected significantly as raw material and freight costs have increased; it also stated that it anticipated that

these costs would ***. All of the responding importers noted that raw material costs have increased, with

several noting that the increase was most dramatic in 2007. For example, one importer, ***, reported that

“through 2006, raw material changes were nominal.” However, this importer noted that starting at the

beginning of 2007, raw materials for brake rotors have skyrocketed and that some of its suppliers will not

even give firm prices because of raw material volatility.

Transportation Costs to the U.S. Market

Transportation costs for brake rotors from China to the United States (excluding U.S. inland

costs) during 2007 are estimated to be equivalent to approximately 12.8 percent of the customs value. 

These estimates are derived from official import data and represent the transportation and other charges

on imports valued on a c.i.f. basis, as compared with customs value.1

U.S. Inland Transportation Costs

U.S. producers reported that U.S. inland transportation costs for brake rotors, as a share of total

costs, ranged from approximately *** percent to *** percent.2

 Importers reported a larger range of

estimates of U.S. inland transportation costs, ranging from 3 percent to 40 percent.

Producers and importers also were asked to estimate the shares of their sales that occurred within

certain distance ranges. The two responding U.S. producers reported that a relatively small portion of

their sales (*** percent or less) are made within 100 miles of their production facility. Of the remainder,

these firms reported *** between shipments between 101 and 1,000 miles and over 1,000 miles. For 
 Nine of 12 responding importers reported that 26 percent or less of total shipments were made within 100 miles 3

of their facility. 

V-2

Figure V-1

Ferrous iron: Monthly prices of no. 1 heavy melt ferrous scrap, January 2002-March 2008

Source: American Metal Market.

U.S. importers of brake rotors from China, most firms reported shipping either between 101 and 1,000

miles from their facility or more than 1,000 miles from their facility.3

Exchange Rates

Figure V-2 show the quarterly exchange rate for China during 2002-07. The nominal rate of the

Chinese yuan was pegged to the U.S. dollar until the third quarter of 2005, at which point the yuan

appreciated relative to the U.S. dollar. A real value is unavailable.

PRICING PRACTICES

Pricing Methods

U.S. producers and importers of aftermarket brake rotors from China reported using a variety of

methods to determine the prices of aftermarket brake rotors. *** stated that its prices are based on ***.

*** reported that for its sales of U.S.-produced aftermarket brake rotors, prices are established using a

combination of methods including ***; it also noted that it does provide printed distributor price lists.

Importers of aftermarket brake rotors were varied in how their firm determines prices for these products,

with firms noting that prices are based on price lists, cost plus freight, and market dynamics.

U.S. producers, importers of brake rotors from China, and Chinese foreign producers of

aftermarket brake rotors reported selling brake rotors on both a contract and spot basis. For U.S.
 Two importers, ***, reported that contracts are typically one year in duration while one additional importer, ***, 4

reported that contracts are typically 3 years long.

V-3

Figure V-2

Exchange rate: Index of the nominal exchange rate of the Chinese currency relative to the U.S.

dollar, by quarters, January 2002-December 2007 

Source: International Monetary Fund, International Financial Statistics, March 12, 2008.

producers, Federal-Mogul reported that *** of its U.S.-produced brake rotors were sold on a long-term

contract or spot basis, *** it stated that *** percent were on a short-term contract basis. Affinia reported

that *** of its sales of domestic brake rotors were on a short-term contract basis; it sold *** on a longterm contract basis *** and *** on a spot basis. While three responding U.S. importers reported that 100

percent of their sales were on a long-term contract basis, most other importers stated that all of their sales

were either on a short-term contract basis (three firms) or all were on a spot basis (eight firms). Of the 12

responding Chinese producers, three firms reported that 100 percent of their sales to U.S. customers were

on a long-term contract basis, four firms reported that 100 percent of their sales were on a short-term

contract basis, and three firms reported that 100 percent of their sales were on a spot basis. 

Importers that reported using long-term contracts noted that contracts ranged from one year in

duration to three years. With regard to terms of the contracts, two of the three firms stated that prices 4

can be renegotiated during the term of the contract and that contracts tend to have meet-or-release

provisions. 

Chinese producers that reported using long-term contracts for sales to U.S. customers stated that

the average duration of contracts was 12-18 months. Chinese producers were mixed with regard to

contract terms, with three reporting that long-term contracts did not fix either prices or quantities and two

firms reporting that contracts fixed both. Three of five responding Chinese producers noted that prices

are not renegotiated within a contract period; three firms also noted that their contracts do contain meetor-release clauses.
 5

 One Chinese producer noted that its short-term contracts were 12 months in duration.

V-4

With regard to short-term contracts, Affinia reported that most are for a period of ***. Five

importers provided information on their short-term contracts. These firms reported that durations of

contracts ranged from 30 days to 12 months. The terms vary, with two firms reporting that the contracts

did not fix price or quantity, two noting that they just fixed price, and one stating that both price and

quantity were fixed. With regard to meet-or-release provisions, two importers reported that their shortterm contracts did contain them and three reported that they did not. Six Chinese producers provided

information on their short-term contracts with U.S. customers. These firms reported that short-term

contracts generally lasted between 45 and 120 days.5

 Four of the six responding Chinese producers

reported that both price and quantity are fixed, with three of these firms noting that prices can be

renegotiated during the term of the contract. One half of the responding firms also noted that their shortterm contracts contain meet-or-release clauses.

In the U.S. brake rotor market, U.S. producers reported selling product from inventory while most

importers and all of the responding Chinese producers reported selling product produced to order. The

two responding producers reported that *** percent of their sales are from inventory. Of the responding

importers, eight firms reported that 60 percent or more of their sales were for product produced to order,

with four of these firms noting that 100 percent were produced to order. All of the 11 responding Chinese

producers reported that more than 90 percent of their sales are on a made-to-order basis. As a result,

leadtimes reported by U.S. producers were much lower than those reported by U.S. importers and Chinese

suppliers. Affinia and Federal-Mogul reported leadtimes of *** and ***, respectively. Importers, on the

other hand, reported leadtimes for delivery ranging from 40 to 120 days, with five of eight reporting

leadtimes of 90 days. Leadtimes for delivery reported by Chinese producers ranged from 2 to 6 months.

Both U.S. producers and the majority of importers reported that sales of aftermarket brake rotors

are done on a freight prepaid or delivered basis. *** reported offering a 2- percent discount on their sales

of domestic brake rotors if payment is made within a certain time period. While three importers of brake

rotors from China reported offering 2-percent payment discounts, most responding importers noted that

sales terms are usually net 30, 77, 90, or 120 days.

Discounts and Promotions

U.S. producers and importers of brake rotors from China both reported using some discounts for

their sales. For its sales of U.S.-produced brake rotors, Affinia reported that discounts and/rebates vary

***. Affinia noted that consideration for discounts include ***. Federal-Mogul also reported using ***.

PRICE DATA

The Commission requested U.S. producers and importers of brake rotors to provide quarterly data

for the total quantity and f.o.b. (U.S. point of shipment) value of brake rotors that were shipped to

unrelated customers in the U.S. market. Data were requested for the period January 2002 to December

2007. The products for which pricing data were requested are defined as follows: 

Product 1.–Brake rotor models of AIMCO part number 54010, or models that otherwise

conform to that AIMCO part number. 

Product 2.–Brake rotor models of AIMCO part number 55034, or models that otherwise

conform to that AIMCO part number. 
V-5

Product 3.–Brake rotor models of AIMCO part number 55040, or models that otherwise

conform to that AIMCO part number. 

Product 4.–Brake rotor models of AIMCO part number 55066, or models that otherwise

conform to that AIMCO part number. 

Two U.S. producers of brake rotors and 10 importers of subject brake rotors from China provided

usable pricing data for sales of the requested products, although not all firms reported pricing for all

quarters. Tables V-1 through V-4 and figures V-3 through V-6 present f.o.b. (U.S. point of shipment)

selling prices for the four brake rotor products defined above produced and sold in the United States as

well as for products produced in China and imported and sold in the U.S. market. By quantity, pricing

data reported by responding firms in 2007 accounted for approximately *** percent of reported U.S.

commercial shipments of U.S.-produced brake rotors and for 3.1 percent of reported U.S. commercial

shipments of Chinese brake rotors.

Table V-1

Brake rotors: Weighted-average f.o.b. prices and quantities of domestic and imported product 1

and margins of underselling/(overselling), by quarters, January-March 2002 to October-December

2007

* * * * * * *

Table V-2

Brake rotors: Weighted-average f.o.b. prices and quantities of domestic and imported product 2

and margins of underselling/(overselling), by quarters, January-March 2002 to October-December

2007

* * * * * * *

Table V-3

Brake rotors: Weighted-average f.o.b. prices and quantities of domestic and imported product 3

and margins of underselling/(overselling), by quarters, January-March 2002 to October-December

2007

* * * * * * *

Table V-4

Brake rotors: Weighted-average f.o.b. prices and quantities of domestic and imported product 4

and margins of underselling/(overselling), by quarters, January-March 2002 to October-December

2007

* * * * * * *

Figure V-3

Brake rotors: Weighted-average f.o.b. prices of domestic and imported product 1, by quarters,

January 2002 to December 2007

* * * * * * *
 6

 Questionnaire response of *** and email correspondence from ***, dated May 1, 2008. ***.

 7

 As can be seen in table V-5, prices reported by ***.

V-6

Figure V-4

Brake rotors: Weighted-average f.o.b. prices of domestic and imported product 2, by quarters,

January 2002 to December 2007

* * * * * * *

Figure V-5

Brake rotors: Weighted-average f.o.b. prices of domestic and imported product 3, by quarters,

January 2002 to December 2007

* * * * * * *

Figure V-6

Brake rotors: Weighted-average f.o.b. prices of domestic and imported product 4, by quarters,

January 2002 to December 2007

* * * * * * *

Producers and importers were not requested to report price data separately for premium and

economy brake rotors. The data reported for *** represent sales of premium rotors.6

 Data for imports of

brake rotors from China generally represent sales of economy brake rotors. ***; these data, along with

U.S. producers’ and U.S. importers’ prices, are presented in table V-5.7

 

Price Trends

Weighted-average f.o.b prices for domestic brake rotors generally fluctuated for all four products

over the period for which data were collected. For product 1, U.S. producers’ prices decreased by ***

percent from January-March 2002 to July-September 2003, increased by *** percent in OctoberDecember 2003, and then remained fairly stable for the remainder of the period for which data were

collected. Overall, prices for domestic product 1 were *** percent lower at the end of 2007 as compared

to the beginning of 2002. Weighted-average prices for domestic product 2 increased during 2002 then

declined irregularly throughout the remainder of the period for which data were collected and were ***

percent lower at the end of the period than they were at the beginning. Prices for domestically produced

product 3 increased in 2002, then declined irregularly throughout the remainder of the period, however,

prices for U.S.-produced product 3 were *** percent higher at the end of 2007 than they were at the

beginning of 2002. Prices for U.S.-produced product 4 increased irregularly from January-March 2002 to

their highest level in January-March 2004; these prices then declined irregularly and ended the period ***

percent lower than they were at the beginning of the period.

Weighted-average prices for brake rotors imported from China generally declined over the

period, although all four price series show fluctuations over the period. Overall price declines for

Chinese brake rotor products 1-4 were 17.8, 15.9, 19.2, and 46.8 percent, respectively.
 8

 As noted earlier, price data reported by U.S. producers for U.S.-produced brake rotors are for ***.

V-7

Table V-5

Brake rotors: F.o.b. prices of domestic and imported premium and economy products 1-4, by

quarters, April-June 2007 to October-December 2007

* * * * * * *

Price Comparisons

There were 96 possible comparisons between prices for U.S.-produced and Chinese aftermarket

brake rotors.8

 In all of these instances, the Chinese products were priced lower than the U.S.-produced

products. The following tabulation shows the ranges of margins of underselling for each of the four

products for which price data were requested.

Product Margins of underselling (in percent)

 Product 1 50.3 to 77.2

 Product 2 64.9 to 79.2

 Product 3 60.1 to 73.9

 Product 4 65.8 to 86.5
 
A-1

APPENDIX A

FEDERAL REGISTER NOTICES AND THE 

COMMISSION’S STATEMENT ON ADEQUACY

Federal Register / Vol. 72, No. 126 / Monday, July 2, 2007 / Notices 36037 

SUMMARY: Pursuant to the National 

Environmental Policy Act and the 

California Environmental Quality Act 

(CEQA), the Bureau of Reclamation 

(Reclamation) and the Yuba County 

Water Agency (YCWA) have made 

available for public review and 

comment the Draft EIR/EIS for the 

Proposed Lower Yuba River Accord 

(Yuba Accord). 

Two public hearings will be held to 

provide interested individuals and 

organizations with an opportunity to 

comment verbally and in writing on the 

Draft EIR/EIS. 

The purpose of the Yuba Accord is to 

resolve instream flow issues associated 

with operation of the Yuba River 

Development Project (Yuba Project) in a 

way that protects and enhances lower 

Yuba River fisheries and local watersupply reliability. At the same time, it 

would provide revenues for local flood 

control and water supply projects, water 

for the CALFED Program to use for 

protection and restoration of 

Sacramento-San Joaquin Delta (Delta) 

fisheries, and improvements in 

statewide water supply management, 

including supplemental water for the 

Central Valley Project (CVP) and the 

State Water Project (SWP). 

DATES: Two public hearings will be held 

on August 1, 2007 from 2 to 3 p.m. and 

from 6 to 7 p.m. in Marysville, 

California. 

Submit written comments on the Draft 

EIR/EIS on or before August 24, 2007 at 

the address provided below. 

ADDRESSES: The hearings will be at the 

Yuba County Water Agency, 1220 F 

Street, Marysville, CA 95901. 

Send written comments to Ms. Dianne 

Simodynes, HDR|Surface Water 

Resources, Inc., 1610 Arden Way, Suite 

175, Sacramento, CA 95815–4041. Send 

requests for a compact disk or a bound 

copy of the Draft EIR/EIS to Dianne 

Simodynes, telephone: (916) 569–1096. 

The Yuba Accord Draft EIR/EIS will also 

be available on the web at: http:// 

www.usbr.gov/mp/nepa/ 

nepa_projdetails.cfm?Project_ID=2549. 

FOR FURTHER INFORMATION CONTACT: Mr. 

Tim Rust, Reclamation, Bureau of 

Reclamation, Division of Resources 

Management, 2800 Cottage Way, 

Sacramento, CA 95825, at (916) 978–

5516, or by e-mail at trust@mp.usbr.gov; 

or Mr. Curt Aikens, YCWA, at 1220 F 

Street, Marysville, CA 95901, at (530) 

741–6278, or by e-mail at 

caikens@ycwa.com. 

SUPPLEMENTARY INFORMATION: The Yuba 

Accord represents an effort on the part 

of the Yuba River stakeholders to find 

a solution to the challenges of 

competing interests by providing water 

for fisheries, developing new tools to 

ensure local reliable water supply, 

crafting a revenue stream to pay for the 

Yuba Accord, and providing additional 

water for out-of-county environmental 

and consumptive uses. These various 

objectives would be met through 

implementation of the Yuba Accord, 

which includes the ‘‘Principles of 

Agreement for Proposed Lower Yuba 

River Fisheries Agreement’’ (Fisheries 

Agreement), the ‘‘Principles of 

Agreement for Proposed Conjunctive 

Use Agreements’’ (Conjunctive Use 

Agreements), and the ‘‘Principles of 

Agreement for Proposed Long-term 

Transfer Agreement’’ (Water Purchase 

Agreement). 

The Yuba Accord agreements are: 

• A Fisheries Agreement among 

YCWA, California Department of Fish 

and Game, and the collective nongovernmental organizations, with the 

U.S. Fish and Wildlife Service and the 

National Oceanic and Atmospheric 

Administration, National Marine 

Fisheries Service supporting the 

agreement. Under the Yuba Accord 

Fisheries Agreement, YCWA would 

revise the operation of the Yuba Project 

to provide higher flows in the lower 

Yuba River to protect and enhance 

fisheries and to increase downstream 

water supplies. 

• Conjunctive Use Agreements 

between YCWA and water districts 

within Yuba County for the 

implementation of a comprehensive 

program of conjunctive use of surface 

water and groundwater supplies and 

actions to improve water use 

efficiencies. 

• A Water Purchase Agreement 

among YCWA, the California 

Department of Water Resources (DWR), 

and Reclamation. Under this agreement, 

Reclamation and DWR would purchase 

water for the CALFED Environmental 

Water Account and for the CVP and 

SWP project uses. 

All three of these agreements need to 

be in place for the Yuba Accord to be 

implemented. 

The Draft EIR/EIS analyzes the 

impacts of implementing the Yuba 

Accord on surface water hydrology, 

groundwater hydrology, water supply, 

hydropower, flood control, water 

quality, fisheries, wildlife, vegetation, 

special-status species, recreation, visual, 

cultural resources, Indian Trust Assets, 

air quality, land use, socioeconomic, 

growth inducement, and environmental 

justice resources and conditions. 

Alternatives evaluated in the Draft EIR/ 

EIS include the No Action Alternative, 

No Project Alternative, Proposed 

Project/Action Alternative (Yuba 

Accord Alternative), and Modified Flow 

Alternative. In addition, the Draft EIR/ 

EIS addresses other past, present, and 

reasonably foreseeable actions in 

conjunction with the implementation of 

the Yuba Accord, thus analyzing 

cumulative impacts. 

Copies of the Draft EIR/EIS are 

available for public review at the 

following locations: 

• Bureau of Reclamation, 2800 

Cottage Way, Sacramento, CA 95825. 

• Yuba County Water Agency, 1220 F 

Street, Marysville, CA 95901. 

• Department of Water Resources, 

Division of Environmental Services, 

1416 Ninth Street, Sacramento, CA 

95814. 

• Sacramento Public Library, 828 I 

Street, Sacramento, CA 95814. 

• Yuba County Library, 303 2nd 

Street, Marysville, CA 95901. 

If special assistance is required at the 

public hearings, please contact Dianne 

Simodynes (e-mail: 

Dianne.Simodynes@hdrinc.com). Please 

notify Ms. Simodynes as far in advance 

of the hearings as possible to enable 

Reclamation to secure the needed 

services. If a request cannot be honored, 

the requestor will be notified. 

Before including your name, address, 

phone number, e-mail address, or other 

personal identifying information in your 

comment, you should be aware that 

your entire comment—including your 

personal identifying information—may 

be made publicly available at any time. 

While you can ask us in your comment 

to withhold your personal identifying 

information from public review, we 

cannot guarantee that we will be able to 

do so. 

Dated: June 18, 2007. 

John F. Davis, 

Deputy Regional Director, Mid-Pacific Region. 

[FR Doc. E7–12728 Filed 6–29–07; 8:45 am] 

BILLING CODE 4310–MN–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation No. 731–TA–744 (Second 

Review)] 

Brake Rotors From China 

AGENCY: United States International 

Trade Commission. 

ACTION: Institution of a five-year review 

concerning the antidumping duty order 

on brake rotors from China. 

SUMMARY: The Commission hereby gives 

notice that it has instituted a review 

pursuant to section 751(c) of the Tariff 

Act of 1930 (19 U.S.C. 1675(c)) (the Act) 

to determine whether revocation of the 


jlentini on PROD1PC65 with NOTICES
36038 Federal Register / Vol. 72, No. 126 / Monday, July 2, 2007 / Notices 

1No response to this request for information is 

required if a currently valid Office of Management 

and Budget (OMB) number is not displayed; the 

OMB number is 3117–0016/USITC No. 07–5–172, 

expiration date June 30, 2008. Public reporting 

burden for the request is estimated to average 10 

hours per response. Please send comments 

regarding the accuracy of this burden estimate to 

the Office of Investigations, U.S. International Trade 

Commission, 500 E Street, SW., Washington, DC 

20436. 

antidumping duty order on brake rotors 

from China would be likely to lead to 

continuation or recurrence of material 

injury. Pursuant to section 751(c)(2) of 

the Act, interested parties are requested 

to respond to this notice by submitting 

the information specified below to the 

Commission; 1 to be assured of 

consideration, the deadline for 

responses is August 21, 2007. 

Comments on the adequacy of responses 

may be filed with the Commission by 

September 14, 2007. For further 

information concerning the conduct of 

this review and rules of general 

application, consult the Commission’s 

Rules of Practice and Procedure, part 

201, subparts A through E (19 CFR part 

201), and part 207, subparts A, D, E, and 

F (19 CFR part 207). 

DATES: Effective Date: July 2, 2007. 

FOR FURTHER INFORMATION CONTACT: 

Mary Messer (202–205–3193), Office of 

Investigations, U.S. International Trade 

Commission, 500 E Street, SW., 

Washington, DC 20436. Hearingimpaired persons can obtain 

information on this matter by contacting 

the Commission’s TDD terminal on 202–

205–1810. Persons with mobility 

impairments who will need special 

assistance in gaining access to the 

Commission should contact the Office 

of the Secretary at 202–205–2000. 

General information concerning the 

Commission may also be obtained by 

accessing its Internet server (http:// 

www.usitc.gov). The public record for 

this review may be viewed on the 

Commission’s electronic docket (EDIS) 

at http://edis.usitc.gov. 

SUPPLEMENTARY INFORMATION: 

Background.—On April 17, 1997, the 

Department of Commerce issued an 

antidumping duty order on imports of 

brake rotors from China (62 FR 18740). 

Following five-year reviews by 

Commerce and the Commission, 

effective August 14, 2002, Commerce 

issued a continuation of the 

antidumping duty order on imports of 

brake rotors from China (67 FR 52933). 

The Commission is now conducting a 

second review to determine whether 

revocation of the order would be likely 

to lead to continuation or recurrence of 

material injury to the domestic industry 

within a reasonably foreseeable time. It 

will assess the adequacy of interested 

party responses to this notice of 

institution to determine whether to 

conduct a full review or an expedited 

review. The Commission’s 

determination in any expedited review 

will be based on the facts available, 

which may include information 

provided in response to this notice. 

Definitions.—The following 

definitions apply to this review: 

(1) Subject Merchandise is the class or 

kind of merchandise that is within the 

scope of the five-year review, as defined 

by the Department of Commerce. 

(2) The Subject Country in this review 

is China. 

(3) The Domestic Like Product is the 

domestically produced product or 

products which are like, or in the 

absence of like, most similar in 

characteristics and uses with, the 

Subject Merchandise. In its original 

determination and its expedited fiveyear review determination, the 

Commission defined the Domestic Like 

Product as all aftermarket brake rotors, 

coextensive with Commerce’s scope. 

(4) The Domestic Industry is the U.S. 

producers as a whole of the Domestic 

Like Product, or those producers whose 

collective output of the Domestic Like 

Product constitutes a major proportion 

of the total domestic production of the 

product. In its original determination 

and its expedited five-year review 

determination, the Commission defined 

the Domestic Industry as all producers 

of aftermarket brake rotors. In its 

original determination, the Commission 

also determined that appropriate 

circumstances existed to exclude 

AlliedSignal from the domestic 

aftermarket rotor industry as a related 

party; however, in its expedited fiveyear review determination, the 

Commission did not find that 

appropriate circumstances existed to 

exclude any producer from the domestic 

industry. 

(5) An Importer is any person or firm 

engaged, either directly or through a 

parent company or subsidiary, in 

importing the Subject Merchandise into 

the United States from a foreign 

manufacturer or through its selling 

agent. 

Participation in the review and public 

service list.—Persons, including 

industrial users of the Subject 

Merchandise and, if the merchandise is 

sold at the retail level, representative 

consumer organizations, wishing to 

participate in the review as parties must 

file an entry of appearance with the 

Secretary to the Commission, as 

provided in section 201.11(b)(4) of the 

Commission’s rules, no later than 21 

days after publication of this notice in 

the Federal Register. The Secretary will 

maintain a public service list containing 

the names and addresses of all persons, 

or their representatives, who are parties 

to the review. 

Former Commission employees who 

are seeking to appear in Commission 

five-year reviews are reminded that they 

are required, pursuant to 19 CFR 201.15, 

to seek Commission approval if the 

matter in which they are seeking to 

appear was pending in any manner or 

form during their Commission 

employment. The Commission is 

seeking guidance as to whether a second 

transition five-year review is the ‘‘same 

particular matter’’ as the underlying 

original investigation for purposes of 19 

CFR 201.15 and 18 U.S.C. 207, the post 

employment statute for Federal 

employees. Former employees may seek 

informal advice from Commission ethics 

officials with respect to this and the 

related issue of whether the employee’s 

participation was ‘‘personal and 

substantial.’’ However, any informal 

consultation will not relieve former 

employees of the obligation to seek 

approval to appear from the 

Commission under its rule 201.15. For 

ethics advice, contact Carol McCue 

Verratti, Deputy Agency Ethics Official, 

at 202–205–3088. 

Limited disclosure of business 

proprietary information (BPI) under an 

administrative protective order (APO) 

and APO service list.—Pursuant to 

section 207.7(a) of the Commission’s 

rules, the Secretary will make BPI 

submitted in this review available to 

authorized applicants under the APO 

issued in the review, provided that the 

application is made no later than 21 

days after publication of this notice in 

the Federal Register. Authorized 

applicants must represent interested 

parties, as defined in 19 U.S.C. 1677(9), 

who are parties to the review. A 

separate service list will be maintained 

by the Secretary for those parties 

authorized to receive BPI under the 

APO. 

Certification.—Pursuant to section 

207.3 of the Commission’s rules, any 

person submitting information to the 

Commission in connection with this 

review must certify that the information 

is accurate and complete to the best of 

the submitter’s knowledge. In making 

the certification, the submitter will be 

deemed to consent, unless otherwise 

specified, for the Commission, its 

employees, and contract personnel to 

use the information provided in any 

other reviews or investigations of the 

same or comparable products which the 

Commission conducts under Title VII of 

the Act, or in internal audits and 

investigations relating to the programs 


jlentini on PROD1PC65 with NOTICES
Federal Register / Vol. 72, No. 126 / Monday, July 2, 2007 / Notices 36039 

and operations of the Commission 

pursuant to 5 U.S.C. Appendix 3. 

Written submissions.—Pursuant to 

section 207.61 of the Commission’s 

rules, each interested party response to 

this notice must provide the information 

specified below. The deadline for filing 

such responses is August 21, 2007. 

Pursuant to section 207.62(b) of the 

Commission’s rules, eligible parties (as 

specified in Commission rule 

207.62(b)(1)) may also file comments 

concerning the adequacy of responses to 

the notice of institution and whether the 

Commission should conduct an 

expedited or full review. The deadline 

for filing such comments is September 

14, 2007. All written submissions must 

conform with the provisions of sections 

201.8 and 207.3 of the Commission’s 

rules and any submissions that contain 

BPI must also conform with the 

requirements of sections 201.6 and 

207.7 of the Commission’s rules. The 

Commission’s rules do not authorize 

filing of submissions with the Secretary 

by facsimile or electronic means, except 

to the extent permitted by section 201.8 

of the Commission’s rules, as amended, 

67 FR 68036 (November 8, 2002). Also, 

in accordance with sections 201.16(c) 

and 207.3 of the Commission’s rules, 

each document filed by a party to the 

review must be served on all other 

parties to the review (as identified by 

either the public or APO service list as 

appropriate), and a certificate of service 

must accompany the document (if you 

are not a party to the review you do not 

need to serve your response). 

Inability to provide requested 

information.—Pursuant to section 

207.61(c) of the Commission’s rules, any 

interested party that cannot furnish the 

information requested by this notice in 

the requested form and manner shall 

notify the Commission at the earliest 

possible time, provide a full explanation 

of why it cannot provide the requested 

information, and indicate alternative 

forms in which it can provide 

equivalent information. If an interested 

party does not provide this notification 

(or the Commission finds the 

explanation provided in the notification 

inadequate) and fails to provide a 

complete response to this notice, the 

Commission may take an adverse 

inference against the party pursuant to 

section 776(b) of the Act in making its 

determination in the review. 

Information To Be Provided in 

Response to This Notice of Institution: 

As used below, the term ‘‘firm’’ includes 

any related firms. 

(1) The name and address of your firm 

or entity (including World Wide Web 

address if available) and name, 

telephone number, fax number, and email address of the certifying official. 

(2) A statement indicating whether 

your firm/entity is a U.S. producer of 

the Domestic Like Product, a U.S. union 

or worker group, a U.S. importer of the 

Subject Merchandise, a foreign producer 

or exporter of the Subject Merchandise, 

a U.S. or foreign trade or business 

association, or another interested party 

(including an explanation). If you are a 

union/worker group or trade/business 

association, identify the firms in which 

your workers are employed or which are 

members of your association. 

(3) A statement indicating whether 

your firm/entity is willing to participate 

in this review by providing information 

requested by the Commission. 

(4) A statement of the likely effects of 

the revocation of the antidumping duty 

order on the Domestic Industry in 

general and/or your firm/entity 

specifically. In your response, please 

discuss the various factors specified in 

section 752(a) of the Act (19 U.S.C. 

1675a(a)) including the likely volume of 

subject imports, likely price effects of 

subject imports, and likely impact of 

imports of Subject Merchandise on the 

Domestic Industry. 

(5) A list of all known and currently 

operating U.S. producers of the 

Domestic Like Product. Identify any 

known related parties and the nature of 

the relationship as defined in section 

771(4)(B) of the Act (19 U.S.C. 

1677(4)(B)). 

(6) A list of all known and currently 

operating U.S. importers of the Subject 

Merchandise and producers of the 

Subject Merchandise in the Subject 

Country that currently export or have 

exported Subject Merchandise to the 

United States or other countries after 

2001. 

(7) If you are a U.S. producer of the 

Domestic Like Product, provide the 

following information on your firm’s 

operations on that product during 

calendar year 2006 (report quantity data 

in units and value data in U.S. dollars, 

f.o.b. plant). If you are a union/worker 

group or trade/business association, 

provide the information, on an aggregate 

basis, for the firms in which your 

workers are employed/which are 

members of your association. 

(a) Production (quantity) and, if 

known, an estimate of the percentage of 

total U.S. production of the Domestic 

Like Product accounted for by your 

firm’s(s’) production; 

(b) Capacity (quantity) of your firm to 

produce the Domestic Like Product; 

(c) the quantity and value of U.S. 

commercial shipments of the Domestic 

Like Product produced in your U.S. 

plant(s); and 

(d) the quantity and value of U.S. 

internal consumption/company 

transfers of the Domestic Like Product 

produced in your U.S. plant(s). 

(8) If you are a U.S. importer or a 

trade/business association of U.S. 

importers of the Subject Merchandise 

from the Subject Country, provide the 

following information on your firm’s(s’) 

operations on that product during 

calendar year 2006 (report quantity data 

in units and value data in U.S. dollars). 

If you are a trade/business association, 

provide the information, on an aggregate 

basis, for the firms which are members 

of your association. 

(a) The quantity and value (landed, 

duty-paid but not including 

antidumping duties) of U.S. imports 

and, if known, an estimate of the 

percentage of total U.S. imports of 

Subject Merchandise from the Subject 

Country accounted for by your firm’s(s’) 

imports; 

(b) the quantity and value (f.o.b. U.S. 

port, including antidumping duties) of 

U.S. commercial shipments of Subject 

Merchandise imported from the Subject 

Country; and 

(c) the quantity and value (f.o.b. U.S. 

port, including antidumping duties) of 

U.S. internal consumption/company 

transfers of Subject Merchandise 

imported from the Subject Country. 

(9) If you are a producer, an exporter, 

or a trade/business association of 

producers or exporters of the Subject 

Merchandise in the Subject Country, 

provide the following information on 

your firm’s(s’) operations on that 

product during calendar year 2006 

(report quantity data in units and value 

data in U.S. dollars, landed and dutypaid at the U.S. port but not including 

antidumping duties). If you are a trade/ 

business association, provide the 

information, on an aggregate basis, for 

the firms which are members of your 

association. 

(a) Production (quantity) and, if 

known, an estimate of the percentage of 

total production of Subject Merchandise 

in the Subject Country accounted for by 

your firm’s(s’) production; 

(b) Capacity (quantity) of your firm to 

produce the Subject Merchandise in the 

Subject Country; and 

(c) the quantity and value of your 

firm’s(s’) exports to the United States of 

Subject Merchandise and, if known, an 

estimate of the percentage of total 

exports to the United States of Subject 

Merchandise from the Subject Country 

accounted for by your firm’s(s’) exports. 

(10) Identify significant changes, if 

any, in the supply and demand 

conditions or business cycle for the 

Domestic Like Product that have 

occurred in the United States or in the 


jlentini on PROD1PC65 with NOTICES
36040 Federal Register / Vol. 72, No. 126 / Monday, July 2, 2007 / Notices 

market for the Subject Merchandise in 

the Subject Country after 2001, and 

significant changes, if any, that are 

likely to occur within a reasonably 

foreseeable time. Supply conditions to 

consider include technology; 

production methods; development 

efforts; ability to increase production 

(including the shift of production 

facilities used for other products and the 

use, cost, or availability of major inputs 

into production); and factors related to 

the ability to shift supply among 

different national markets (including 

barriers to importation in foreign 

markets or changes in market demand 

abroad). Demand conditions to consider 

include end uses and applications; the 

existence and availability of substitute 

products; and the level of competition 

among the Domestic Like Product 

produced in the United States, Subject 

Merchandise produced in the Subject 

Country, and such merchandise from 

other countries. 

(11) (OPTIONAL) A statement of 

whether you agree with the above 

definitions of the Domestic Like Product 

and Domestic Industry; if you disagree 

with either or both of these definitions, 

please explain why and provide 

alternative definitions. 

Authority: This review is being conducted 

under authority of title VII of the Tariff Act 

of 1930; this notice is published pursuant to 

section 207.61 of the Commission’s rules. 

By order of the Commission. 

Issued: June 25, 2007. 

Marilyn R. Abbott, 

Secretary to the Commission. 

[FR Doc. E7–12668 Filed 6–29–07; 8:45 am] 

BILLING CODE 7020–02–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation No. 337–TA–581] 

In the Matter of Certain Inkjet Ink 

Supplies and Components Thereof: 

Notice of a Commission Determination 

Not To Review an Initial Determination 

Granting the Joint Motion of 

Complainant Hewlett-Packard 

Company and Respondent All Media 

Outlet Corporation To Terminate the 

Investigation With Respect to That 

Respondent; Termination of the 

Investigation 

AGENCY: U.S. International Trade 

Commission. 

ACTION: Notice. 

SUMMARY: Notice is hereby given that 

the U.S. International Trade 

Commission has determined not to 

review the presiding administrative law 

judge’s (‘‘ALJ’’) initial determination 

(‘‘ID’’) (Order No. 9) granting the joint 

motion of complainant Hewlett-Packard 

Company (‘‘H–P’’) and respondent All 

Media Outlet Corporation d/b/a 

Inkandbeyond.com (‘‘All Media’’) to 

terminate the investigation with respect 

to All Media, and terminating the 

investigation in its entirety. 

FOR FURTHER INFORMATION CONTACT: 

Michelle Walters, Office of the General 

Counsel, U.S. International Trade 

Commission, 500 E Street, SW., 

Washington, DC 20436, telephone (202) 

708–5468. Copies of non-confidential 

documents filed in connection with this 

investigation are or will be available for 

inspection during official business 

hours (8:45 a.m. to 5:15 p.m.) in the 

Office of the Secretary, U.S. 

International Trade Commission, 500 E 

Street, SW., Washington, DC 20436, 

telephone (202) 205–2000. General 

information concerning the Commission 

may also be obtained by accessing its 

Internet server at http://www.usitc.gov. 

The public record for this investigation 

may be viewed on the Commission’s 

electronic docket (EDIS) at http:// 

edis.usitc.gov. Hearing-impaired 

persons are advised that information on 

this matter can be obtained by 

contacting the Commission’s TDD 

terminal on (202) 205–1810. 

SUPPLEMENTARY INFORMATION: The 

Commission instituted this investigation 

on September 6, 2006, based on a 

complaint filed by H–P of California, 

subsequently amended, alleging 

violations of section 337 of the Tariff 

Act of 1930 (19 U.S.C. 1337) in the 

importation into the United States, the 

sale for importation, or the sale within 

the United States after importation of 

certain inkjet ink supplies and 

components thereof by reason of 

infringement of one or more of claims 

1–4, 7–9, 22, 24, and 25 of U.S. Patent 

No. 5,825,387; claims 1–9 and 12 of U.S. 

Patent No. 6,793,329; claims 8–10, 14, 

and 15 of U.S. Patent No. 6,074,042; 

claims 1–6 and 19–29 of U.S. Patent No. 

6,588,880; claims 1–7 and 11–18 of U.S. 

Patent No. 6,364,472; claims 6, 7, 9, and 

10 of U.S. Patent No. 6,089,687; and 

claims 1–3 and 5 of U.S. Patent No. 

6,264,301. The complaint named six 

respondents: Ninestar Technology Co. 

Ltd. of China, Ninestar Technology Co. 

Ltd. of California, Aurora Eshop, Inc. d/ 

b/a butterflyinkjet.com of California, 

Iowaink, LLC d/b/a iowaink.com of 

Iowa, L2 Commerce Inc. d/b/a 

Printmicro.com of California, and All 

Media Outlet Corp. d/b/a 

Inkandbeyond.com of California. 

On March 19, 2007, H–P and All 

Media jointly moved to terminate the 

investigation with respect to All Media, 

based on a settlement agreement. The 

Commission investigative attorney 

supported the motion. 

On June 6, 2007, the ALJ issued an ID 

(Order No. 9) granting the joint motion 

to terminate the investigation with 

regard to All Media. The ALJ found that 

the joint motion complied with the 

requirements of Commission Rule 

210.21 (19 CFR 210.21). The ALJ also 

concluded that, pursuant to 

Commission Rule 210.50(b)(2) (19 CFR 

210.50(b)(2)), there is no evidence that 

termination of this investigation will 

prejudice the public interest. In 

addition, the ALJ noted that the 

termination of litigation under these 

circumstances as an alternative method 

of dispute resolution is generally in the 

public interest. Accordingly, the ALJ 

terminated the investigation as to All 

Media. In addition, the ALJ terminated 

the investigation in its entirety. No 

petitions for review of this ID were filed. 

The Commission has determined not to 

review the ID. 

The authority for the Commission’s 

determination is contained in section 

337 of the Tariff Act of 1930, as 

amended (19 U.S.C. 1337), and in 

section 210.42 of the Commission’s 

Rules of Practice and Procedure (19 CFR 

210.42). 

By order of the Commission. 

Issued: June 27, 2007. 

Marilyn R. Abbott, 

Secretary to the Commission. 

[FR Doc. E7–12752 Filed 6–29–07; 8:45 am] 

BILLING CODE 7020–02–P 

INTERNATIONAL TRADE 

COMMISSION 

[USITC SE–07–012] 

Government in the Sunshine Act 

Meeting Notice 

AGENCY HOLDING THE MEETING: United 

States International Trade Commission. 

TIME AND DATE: July 10, 2007 at 11 a.m. 

PLACE: Room 101, 500 E Street, SW., 

Washington, DC 20436, Telephone: 

(202) 205–2000. 

STATUS: Open to the public. 

MATTERS TO BE CONSIDERED: 

1. Agenda for future meetings: none. 

2. Minutes. 

3. Ratification List. 

4. Inv. Nos. 731–TA–873–875, 877–

880, and 882 (Review) (Steel Concrete 

Reinforcing Bar from Belarus, China, 

Indonesia, Korea, Latvia, Moldova, 

Poland, and Ukraine)—briefing and 

vote. (The Commission is currently 

scheduled to transmit its determination 


jlentini on PROD1PC65 with NOTICES
Federal Register / Vol. 72, No. 201 / Thursday, October 18, 2007 / Notices 59111 

by means including, but not limited to, 

firearms, bows, crossbows, airsoft and 

paintball guns. Any person failing to 

heed posted notices and found in 

violation of 43 CFR 8365.1–4(a)(2), will 

be issued a citation. In addition, those 

found in violation of other subsections 

contained within 43 CFR 8365.1–1(a) 

and (b)(1) through (b)(6) regarding 

littering and 43 CFR 8365.1–5(a)(1) and 

(2) regarding resource damage will also 

be cited. This regulation remains in 

effect following the temporary closure. 

Public lands affected by this 

temporary closure are described as 

follows: 

T. 7 N., R. 2 E., Sections 4 and 5; T. 8 N., 

R. 2 E., Sections 20, 21, 28, 29, 32–34 

and those portions of Sections 27 and 34 

west of Interstate 17. A map of the 

closure can be viewed at: http:// 

www.blm.gov/az/st/en/fo/ 

hassayampa_field_office.html. 

Dated: October 3, 2007. 

D. Remington Hawes, 

Acting Hassayampa Field Manager. 

[FR Doc. E7–20551 Filed 10–17–07; 8:45 am] 

BILLING CODE 4310–32–P 

DEPARTMENT OF THE INTERIOR 

National Park Service 

Record of Decision on the Final 

Environmental Impact Statement for 

the General Management Plan, Rock 

Creek Park and the Rock Creek and 

Potomac Parkway, Washington, DC 

AGENCY: Department of the Interior, 

National Park Service. 

ACTION: Notice of availability of a 

Record of Decision on the Final 

Environmental Impact Statement for the 

General Management Plan, Rock Creek 

Park and the Rock Creek and Potomac 

Parkway, Washington, DC. 

SUMMARY: Pursuant to the National 

Environmental Policy Act of 1969, 42 

U.S.C. 4332(2)(C), the National Park 

Service (NPS) announces the 

availability of the Record of Decision for 

the Final Environmental Impact 

Statement for the General Management 

Plan, Rock Creek Park and the Rock 

Creek and Potomac Parkway, 

Washington, DC. On June 6, 2007 the 

National Capital Regional Director 

approved the Record of Decision for the 

General Management Plan for the Final 

Environmental Impact Statement. 

Specifically, the NPS has selected the 

preferred alternative (Alternative A) as 

described in the Final General 

Management Plan for the Environmental 

Impact Statement based on 

consideration of economic, 

environmental, technical, and other 

factors. 

The selected alternative and three 

other alternatives, including a no-action 

alternative, were analyzed in the Draft 

and Final Environmental Impact 

Statements. Each alternative considered 

(a) how traffic should be managed in the 

park and on the parkway; (b) the most 

appropriate levels of service and 

locations for visitor interpretation and 

education in the park; (c) the 

appropriate balance between 

rehabilitation of historic structures and 

cultural landscapes and preservation of 

natural resources; and (d) the most 

appropriate locations to support park 

administration and operations functions 

to minimize resource disturbance. The 

full range of foreseeable environmental 

consequences was assessed. The NPS 

believes Alternative A would best 

accomplish its goals for managing Rock 

Creek Park and the Rock Creek and 

Potomac Parkway. Alternative A was 

selected by the NPS based on its ability 

to maintain traditional visitor 

experiences and activities, enhance 

resources protection, improve control 

over non-recreational use of park roads 

to heighten safety and the quality of the 

visitor experience, and optimize the use 

of structures for park purposes. The 

selected alternative will not result in the 

impairment of resources and values. 

The most difficult decision to be 

made in this general management 

planning process was the management 

of traffic on the park road system 

because these park roads are recognized 

historic resources and are also the 

primary means for most visitors to 

experience the park. They are also 

heavily used as commuter routes. Under 

the selected alternative, the existing 

park roadway system will be retained 

and non-recreational through-traffic will 

be accommodated. It continues weekday 

auto travel throughout the park, but will 

use traffic-calming and speed 

enforcement measures to reduce traffic 

speeds and volumes to improve visitor 

safety and better control traffic volumes 

and speeds through the park. Speed 

tables and additional traffic signs will 

be installed on Beach Drive in the gorge 

area. 

The selected alternative will also 

enhance interpretation and education 

opportunities and improve the use of 

park resources, especially cultural 

resources. It generally retains the 

current scope of visitor uses. Additional 

aspects of this alternative include trail 

improvement; rehabilitation of the 

Peirce Mill complex to better focus on 

history; the moving of park 

administrative offices from the PeirceKlingle Mansion at Linnean Hill which 

will be rehabilitated for adaptive use 

compatible with park values; the 

relocation of the U.S. Park Police 

substation from the Lodge House on 

Beach Drive with the Lodge House 

converted to a visitor contact station; 

and that the nature center will be 

rehabilitated and expanded, and the 

planetarium upgraded. 

The Record of Decision includes a 

statement of the decision made, 

synopses of other alternatives 

considered, the basis for the decision, a 

finding of no impairment of park 

resources and values and an overview of 

public involvement in the decisionmaking process. This decision is the 

result of a public planning process that 

began in 1996. The official responsible 

for this decision is the NPS Regional 

Director, National Capital Region. 

ADDRESSES: The Record of Decision, 

Plan and other information are available 

for public review in the Office of the 

Superintendent, Rock Creek Park at 

3545 Williamsburg Lane, NW., 

Washington, DC 20008–1207 and at the 

following locations: Chief of Planning, 

National Capital Region, National Park 

Service, 1100 Ohio Drive, SW., 

Washington, DC 20242, (202) 619–7000 

and the Office of Public Affairs, 

National Park Service, Department of 

the Interior, 18th and C Streets, NW., 

Washington, DC 20240, (202) 208–6843. 

Copies of the Record of Decision may 

also be obtained from the contacts listed 

above or may be viewed online at: 

http://www.nps.gov/rocr/parkmgmt/. 

FOR FURTHER INFORMATION CONTACT: 

Superintendent, Rock Creek Park, at 

3545 Williamsburg Lane, NW., 

Washington, DC 20008–1207 or by 

telephone at (202) 895–6004. 

Dated: August 24, 2007. 

Joseph M. Lawler, 

Regional Director, National Capital Region. 

[FR Doc. E7–20544 Filed 10–17–07; 8:45 am] 

BILLING CODE 4312–52–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation No. 731–TA–744 (Second 

Review)] 

Brake Rotors From China 

AGENCY: United States International 

Trade Commission. 

ACTION: Notice of Commission 

determination to conduct a full five-year 

review concerning the antidumping 

duty order on brake rotors from China. 

SUMMARY: The Commission hereby gives 

notice that it will proceed with a full 

review pursuant to section 751(c)(5) of 

mstockstill on PROD1PC66 with NOTICES

59112 Federal Register / Vol. 72, No. 201 / Thursday, October 18, 2007 / Notices 

1The record is defined in sec. 207.2(f) of the 

Commission’s Rules of Practice and Procedure (19 

CFR § 207.2(f)). 

1The record is defined in section 207.2(f) of the 

Commission’s Rules of Practice and Procedure (19 

CFR 207.2(f)). 

the Tariff Act of 1930 (19 U.S.C. 

1675(c)(5)) to determine whether 

revocation of the antidumping duty 

order on brake rotors from China would 

be likely to lead to continuation or 

recurrence of material injury within a 

reasonably foreseeable time. A schedule 

for the review will be established and 

announced at a later date. For further 

information concerning the conduct of 

this review and rules of general 

application, consult the Commission’s 

Rules of Practice and Procedure, part 

201, subparts A through E (19 CFR part 

201), and part 207, subparts A, D, E, and 

F (19 CFR part 207). 

DATES: Effective Date: October 5, 2007. 

FOR FURTHER INFORMATION CONTACT: 

Mary Messer (202–205–3193), Office of 

Investigations, U.S. International Trade 

Commission, 500 E Street, SW., 

Washington, DC 20436. Hearingimpaired persons can obtain 

information on this matter by contacting 

the Commission’s TDD terminal on 202–

205–1810. Persons with mobility 

impairments who will need special 

assistance in gaining access to the 

Commission should contact the Office 

of the Secretary at 202–205–2000. 

General information concerning the 

Commission may also be obtained by 

accessing its Internet server (http:// 

www.usitc.gov). The public record for 

this review may be viewed on the 

Commission’s electronic docket (EDIS) 

at http://edis.usitc.gov. 

SUPPLEMENTARY INFORMATION: On 

October 5, 2007, the Commission 

determined that it should proceed to a 

full review in the subject five-year 

review pursuant to section 751(c)(5) of 

the Act. The Commission found that 

both the domestic and respondent 

interested party group responses to its 

notice of institution (72 FR 36037, July 

2, 2007) were adequate. A record of the 

Commissioners’ votes, the 

Commission’s statement on adequacy, 

and any individual Commissioner’s 

statements will be available from the 

Office of the Secretary and at the 

Commission’s Web site. 

Authority: This review is being conducted 

under authority of title VII of the Tariff Act 

of 1930; this notice is published pursuant to 

section 207.62 of the Commission’s rules. 

By order of the Commission. 

Issued: October 11, 2007. 

William R. Bishop, 

Acting Secretary to the Commission. 

[FR Doc. E7–20528 Filed 10–17–07; 8:45 am] 

BILLING CODE 7020–02–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation No. 731–TA–1123 

(Preliminary)] 

Steel Wire Garment Hangers From 

China 

Determination 

On the basis of the record 1 developed 

in the subject investigation, the United 

States International Trade Commission 

(Commission) determines, pursuant to 

section 733(a) of the Tariff Act of 1930 

(19 U.S.C. 1673b(a)) (the Act), that there 

is a reasonable indication that an 

industry in the United States is 

materially injured by reason of imports 

from China of steel wire garment 

hangers, provided for in statistical 

reporting number 7326.20.0020 of the 

Harmonized Tariff Schedule of the 

United States, that are alleged to be sold 

in the United States at less than fair 

value. 

Commencement of Final Phase 

Investigation 

Pursuant to section 207.18 of the 

Commission’s rules, the Commission 

also gives notice of the commencement 

of the final phase of its investigation. 

The Commission will issue a final phase 

notice of scheduling, which will be 

published in the Federal Register as 

provided in section 207.21 of the 

Commission’s rules, upon notice from 

the Department of Commerce 

(Commerce) of an affirmative 

preliminary determination in this 

investigation under section 733(b) of the 

Act, or, if the preliminary determination 

is negative, upon notice of an 

affirmative final determination in the 

investigation under section 735(a) of the 

Act. Parties that filed entries of 

appearance in the preliminary phase of 

the investigation need not enter a 

separate appearance for the final phase 

of the investigation. Industrial users, 

and, if the merchandise under 

investigation is sold at the retail level, 

representative consumer organizations 

have the right to appear as parties in 

Commission antidumping and 

countervailing duty investigations. The 

Secretary will prepare a public service 

list containing the names and addresses 

of all persons, or their representatives, 

who are parties to the investigation. 

Background 

On July 31, 2007, a petition was filed 

with the Commission and Commerce by 

M&B Metal Products Company, Inc. on 

behalf of the domestic industry that 

produces steel wire garment hangers, 

alleging that an industry in the United 

States is materially injured or 

threatened with material injury by 

reason of less-than-fair-value imports of 

steel wire garment hangers from China. 

Accordingly, effective July 31, 2007, the 

Commission instituted antidumping 

duty investigation No. 731–TA–1123 

(Preliminary). 

Notice of the institution of the 

Commission’s investigation and of a 

public conference to be held in 

connection therewith was given by 

posting copies of the notice in the Office 

of the Secretary, U.S. International 

Trade Commission, Washington, DC, 

and by publishing the notice in the 

Federal Register of August 10, 2007 (72 

FR 45069). The conference was held in 

Washington, DC, on August 21, 2007, 

and all persons who requested the 

opportunity were permitted to appear in 

person or by counsel. 

The Commission transmitted its 

determination in the investigation to the 

Secretary of Commerce on October 10, 

2007. The views of the Commission are 

contained in USITC Publication 3951 

(October 2007), entitled Steel Wire 

Garment Hangers from China: 

Investigation No. 731–TA–1123 

(Preliminary). 

By order of the Commission. 

Issued: October 11, 2007. 

William R. Bishop, 

Acting Secretary to the Commission. 

[FR Doc. E7–20529 Filed 10–17–07; 8:45 am] 

BILLING CODE 7020–02–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation No. 731–TA–1123 

(Preliminary)] 

Steel Wire Garment Hangers From 

China 

Determination 

On the basis of the record 1 developed 

in the subject investigation, the United 

States International Trade Commission 

(Commission) determines, pursuant to 

section 733(a) of the Tariff Act of 1930 

(19 U.S.C. 1673b(a)) (the Act), that there 

is a reasonable indication that an 

industry in the United States is 

materially injured by reason of imports 

from China of steel wire garment 

hangers, provided for in statistical 

reporting number 7326.20.0020 of the 

Harmonized Tariff Schedule of the 

mstockstill on PROD1PC66 with NOTICES

Federal Register / Vol. 72, No. 227 / Tuesday, November 27, 2007 / Notices 66187 

Rhode Island 

Washington County 

Westerly Downtown Historic District 

(Boundary Increase), 12 Canal St., 

Westerly, 07001297 

Vermont 

Franklin County 

Bridge 12, (Metal Truss, Masonry, and 

Concrete Bridges in Vermont MPS) Boston 

Post Rd., Enosburg, 07001299 

Bridge 9, 

(Metal Truss, Masonry, and Concrete Bridges 

in Vermont MPS) Shawville Rd., Sheldon, 

07001298 

Lamoille County 

Bridge 6, (Metal Truss, Masonry, and 

Concrete Bridges in Vermont MPS) 

Railroad St., Johnson, 07001300 

A request for REMOVAL has been made for 

the following resource: 

Tennessee 

Shelby County 

Douglass High School, 3200 Mount Olive 

Rd., Memphis, 98000241 

[FR Doc. E7–22989 Filed 11–26–07; 8:45 am] 

BILLING CODE 4312–51–P 

INTERNATIONAL TRADE 

COMMISSION 

[Investigation No. 731–TA–744 (Second 

Review)] 

Brake Rotors From China 

AGENCY: United States International 

Trade Commission. 

ACTION: Scheduling of a full five-year 

review concerning the antidumping 

duty order on brake rotors from China. 

SUMMARY: The Commission hereby gives 

notice of the scheduling of a full review 

pursuant to section 751(c)(5) of the 

Tariff Act of 1930 (19 U.S.C. 1675(c)(5)) 

(the Act) to determine whether 

revocation of the antidumping duty 

order on brake rotors from China would 

be likely to lead to continuation or 

recurrence of material injury within a 

reasonably foreseeable time. For further 

information concerning the conduct of 

this review and rules of general 

application, consult the Commission’s 

Rules of Practice and Procedure, part 

201, subparts A through E (19 CFR part 

201), and part 207, subparts A, D, E, and 

F (19 CFR part 207). 

EFFECTIVE DATE: November 19, 2007. 

FOR FURTHER INFORMATION CONTACT: 

Mary Messer (202–205–3193), Office of 

Investigations, U.S. International Trade 

Commission, 500 E Street, SW., 

Washington, DC 20436. Hearingimpaired persons can obtain 

information on this matter by contacting 

the Commission’s TDD terminal on 202–

205–1810. Persons with mobility 

impairments who will need special 

assistance in gaining access to the 

Commission should contact the Office 

of the Secretary at 202–205–2000. 

General information concerning the 

Commission may also be obtained by 

accessing its internet server (http:// 

www.usitc.gov). The public record for 

this review may be viewed on the 

Commission’s electronic docket (EDIS) 

at http://edis.usitc.gov. 

SUPPLEMENTARY INFORMATION: 

Background. On October 5, 2007, the 

Commission determined that responses 

to its notice of institution of the subject 

five-year review were such that a full 

review pursuant to section 751(c)(5) of 

the Act should proceed (72 F.R. 59111, 

October 18, 2007). A record of the 

Commissioners’ votes, the 

Commission’s statement on adequacy, 

and any individual Commissioner’s 

statements are available from the Office 

of the Secretary and at the 

Commission’s Web site. 

Participation in the review and public 

service list. Persons, including 

industrial users of the subject 

merchandise and, if the merchandise is 

sold at the retail level, representative 

consumer organizations, wishing to 

participate in this review as parties 

must file an entry of appearance with 

the Secretary to the Commission, as 

provided in section 201.11 of the 

Commission’s rules, by 45 days after 

publication of this notice. A party that 

filed a notice of appearance following 

publication of the Commission’s notice 

of institution of the review need not file 

an additional notice of appearance. The 

Secretary will maintain a public service 

list containing the names and addresses 

of all persons, or their representatives, 

who are parties to the review. 

Limited disclosure of business 

proprietary information (BPI) under an 

administrative protective order (APO) 

and BPI service list. Pursuant to section 

207.7(a) of the Commission’s rules, the 

Secretary will make BPI gathered in this 

review available to authorized 

applicants under the APO issued in the 

review, provided that the application is 

made by 45 days after publication of 

this notice. Authorized applicants must 

represent interested parties, as defined 

by 19 U.S.C. 1677(9), who are parties to 

the review. A party granted access to 

BPI following publication of the 

Commission’s notice of institution of 

the review need not reapply for such 

access. A separate service list will be 

maintained by the Secretary for those 

parties authorized to receive BPI under 

the APO. 

Staff report. The prehearing staff 

report in the review will be placed in 

the nonpublic record on March 25, 

2008, and a public version will be 

issued thereafter, pursuant to section 

207.64 of the Commission’s rules. 

Hearing. The Commission will hold a 

hearing in connection with the review 

beginning at 9:30 a.m. on April 15, 

2008, at the U.S. International Trade 

Commission Building. Requests to 

appear at the hearing should be filed in 

writing with the Secretary to the 

Commission on or before April 8, 2008. 

A nonparty who has testimony that may 

aid the Commission’s deliberations may 

request permission to present a short 

statement at the hearing. All parties and 

nonparties desiring to appear at the 

hearing and make oral presentations 

should attend a prehearing conference 

to be held at 9:30 a.m. on April 10, 

2008, at the U.S. International Trade 

Commission Building. Oral testimony 

and written materials to be submitted at 

the public hearing are governed by 

sections 201.6(b)(2), 201.13(f), 207.24, 

and 207.66 of the Commission’s rules. 

Parties must submit any request to 

present a portion of their hearing 

testimony in camera no later than 7 

business days prior to the date of the 

hearing. 

Written submissions. Each party to the 

review may submit a prehearing brief to 

the Commission. Prehearing briefs must 

conform with the provisions of section 

207.65 of the Commission’s rules; the 

deadline for filing is April 3, 2008. 

Parties may also file written testimony 

in connection with their presentation at 

the hearing, as provided in section 

207.24 of the Commission’s rules, and 

posthearing briefs, which must conform 

with the provisions of section 207.67 of 

the Commission’s rules. The deadline 

for filing posthearing briefs is April 24, 

2008; witness testimony must be filed 

no later than three days before the 

hearing. In addition, any person who 

has not entered an appearance as a party 

to the review may submit a written 

statement of information pertinent to 

the subject of the review on or before 

April 24, 2008. On May 19, 2008, the 

Commission will make available to 

parties all information on which they 

have not had an opportunity to 

comment. Parties may submit final 

comments on this information on or 

before May 21, 2008, but such final 

comments must not contain new factual 

information and must otherwise comply 

with section 207.68 of the Commission’s 

rules. All written submissions must 

conform with the provisions of section 

201.8 of the Commission’s rules; any 


pwalker on PROD1PC71 with NOTICES
66188 Federal Register / Vol. 72, No. 227 / Tuesday, November 27, 2007 / Notices 

submissions that contain BPI must also 

conform with the requirements of 

sections 201.6, 207.3, and 207.7 of the 

Commission’s rules. The Commission’s 

rules do not authorize filing of 

submissions with the Secretary by 

facsimile or electronic means, except to 

the extent permitted by section 201.8 of 

the Commission’s rules, as amended, 67 

FR 68036 (November 8, 2002). Even 

where electronic filing of a document is 

permitted, certain documents must also 

be filed in paper form, as specified in II 

(C) of the Commission’s Handbook on 

Electronic Filing Procedures, 67 FR 

68168, 68173 (November 8, 2002). 

Additional written submissions to the 

Commission, including requests 

pursuant to section 201.12 of the 

Commission’s rules, shall not be 

accepted unless good cause is shown for 

accepting such submissions, or unless 

the submission is pursuant to a specific 

request by a Commissioner or 

Commission staff. 

In accordance with sections 201.16(c) 

and 207.3 of the Commission’s rules, 

each document filed by a party to the 

review must be served on all other 

parties to the review (as identified by 

either the public or BPI service list), and 

a certificate of service must be timely 

filed. The Secretary will not accept a 

document for filing without a certificate 

of service. 

Authority: This review is being conducted 

under authority of title VII of the Tariff Act 

of 1930; this notice is published pursuant to 

section 207.62 of the Commission’s rules. 

Issued: November 20, 2007. 

By order of the Commission. 

Marilyn R. Abbott, 

Secretary to the Commission. 

[FR Doc. E7–22975 Filed 11–26–07; 8:45 am] 

BILLING CODE 7020–02–P 

INTERNATIONAL TRADE 

COMMISSION 

[USITC SE–07–026] 

Government in the Sunshine Act 

Meeting Notice 

Agency Holding the Meeting: United 

States International Trade Commission. 

Time and Date: November 29, 2007 at 

11 a.m. 

Place: Room 101, 500 E Street SW., 

Washington, DC 20436, Telephone: 

(202) 205–2000. 

Status: Open to the public. 

Matters To Be Considered 

1. Agenda for future meetings: None. 

2. Minutes. 

3. Ratification List. 

4. Inv. No. 731–TA–909 (Review)(Low 

Enriched Uranium from France)—

briefing and vote. (The Commission is 

currently scheduled to transmit its 

determination and Commissioners’

opinions to the Secretary of Commerce 

on or before December 13, 2007.) 

5. Outstanding action jackets: None. 

In accordance with Commission 

policy, subject matter listed above, not 

disposed of at the scheduled meeting, 

may be carried over to the agenda of the 

following meeting. 

By order of the Commission. 

Issued: November 21, 2007. 

William R. Bishop, 

Hearings and Meetings Coordinator. 

[FR Doc. E7–23008 Filed 11–26–07; 8:45 am] 

BILLING CODE 7020–02–P 

DEPARTMENT OF JUSTICE 

Antitrust Division 

United States v. Multiple Listing 

Service Of Hilton Head Island, Inc.; 

Proposed Final Judgment and 

Competitive Impact Statement 

Notice is hereby given pursuant to the 

Antitrust Procedures and Penalties Act, 

15 U.S.C. 16(b)–(h), that a proposed 

Final Judgment, Stipulation and 

Competitive Impact Statement have 

been filed with the United States 

District Court for the District of South 

Carolina in United States of America v. 

Multiple Listing Service of Hilton Head 

Island, Inc., Civil Action No, 07–3435. 

On October 17, 2007, the United States 

filed a Complaint alleging that the 

Multiple Listing Service of Hilton Head 

Island, Inc. violated section 1 of the 

Sherman Act, 15 U.S.C. 1, by adopting 

and enforcing rules that restrict access 

to the Multiple Listing Service database 

and limit members’ business behavior. 

The proposed Final Judgment, filed at 

the same time as the Complaint, 

requires the group to change its 

membership rules so that low-priced 

and innovative real estate brokers can 

compete in the Hilton Head area. 

Copies of the Complaint, proposed 

Final Judgment and Competitive Impact 

Statement are available for inspection at 

the Department of Justice, Antitrust 

Division, Antitrust Documents Group, 

325 7th Street, NW., Room 215, 

Washington, DC 20530 (telephone: 202–

514–2481), on the Department of 

Justice’s Web site at http:// 

www.usdoj.gov/atr. and at the Office of 

the Clerk of the United States District 

Court for the District of South Carolina. 

Copies of these materials may be 

obtained from the Antitrust Division 

upon request and payment of the 

copying fee set by Department of Justice 

regulations. 

Public comment is invited within 60 

days of the date of this notice. Such 

comments, and responses thereto, will 

be published in the Federal Register 

and filed with the Court. Comments 

should be addressed to John R. Read, 

Chief, Litigation III Section, Antitrust 

Division, U.S. Department of Justice, 

325 7th Street, NW., Suite 300, 

Washington, DC 20530, (202) 307–0468. 

J. Robert Kramer II, 

Director of Operations Antitrust Division. 

United States District Court for the 

District of South Carolina Beaufort 

Division 

United States of America, Department 

of Justice, Antitrust Division, 325 7th 

Street, NW., Suite 300, Washington, DC 

20530, Plaintiff, v. Multiple Listing 

Service of Hilton Head Island, Inc., 18 

Bow Circle, Hilton Head Island, SC 

29928, Defendant 

Civil Action No.9 :07–CV–3435–SB 

Filed: 10/16/07 

Complaint for Equitable Relief for 

Violation of 15 U.S.C. 1 Sherman 

Antitrust Act 

Complaint 

The United States of America, by its 

attorneys acting under the direction of 

the acting Attorney General, brings this 

civil antitrust action against Defendant 

Multiple Listing Service of Hilton Head 

Island, Inc. (‘‘Hilton Head MLS’’) to 

obtain equitable and other relief for 

violation of Section 1 of the Sherman 

Act, 15 U.S.C. 1, as amended. 

Introduction 

1. The United States brings this action 

to enjoin the Defendant from enforcing 

certain of its rules that unreasonably 

restrain competition among real estate 

brokers in the Hilton Head, South 

Carolina area Defendant is a multiple 

listing service, which is controlled by its 

members who are real estate brokers 

competing to sell brokerage services to 

consumers in the Hilton Head area. 

2. Defendant provides a variety of 

services to its members, including the 

maintenance of a database of past and 

current listings of properties for sale in 

the Hilton Head area. Access to the 

database is critical to being a successful 

broker. Therefore, brokers seeking to 

provide brokerage services in the Hilton 

Head area need to be members of the 

Hilton Head MLS. 

3. By its rules, Defendant denies 

membership to brokers who would 

likely compete aggressively on price or 

would introduce Internet-based 

brokerage into the market, and imposes 

unreasonable membership costs on 

publicly-owned brokerage companies. 


pwalker on PROD1PC71 with NOTICES
Federal Register / Vol. 73, No. 5 / Tuesday, January 8, 2008 / Notices 1319 

6711 Bickmore Avenue in Chino (new 

site total—83.16 acres); and, 

Site 20 (Park Mira Loma West)—

Remove 340.73 acres (11 parcels) within 

the site due to changed circumstances 

(new site total—284.15 acres). 

In accordance with the Board’s 

regulations, a member of the FTZ Staff 

has been designated examiner to 

investigate the application and report to 

the Board. 

Public comment is invited from 

interested parties. Submissions (original 

and 3 copies) shall be addressed to the 

Board’s Executive Secretary at the 

address below. The closing period for 

their receipt is March 10, 2008. Rebuttal 

comments in response to material 

submitted during the foregoing period 

may be submitted during the subsequent 

15-day period to March 24, 2008. 

A copy of the application and 

accompanying exhibits will be available 

for public inspection at each of the 

following locations: U.S. Department of 

Commerce, Export Assistance Center, 

11150 West Olympic Boulevard, Suite 

975, Los Angeles, CA 90064; and, Office 

of the Executive Secretary, ForeignTrade Zones Board, Room 2111, U.S. 

Department of Commerce, 1401 

Constitution Avenue, NW., Washington, 

DC 20230. 

For further information, contact 

Camille Evans at 

Camille_Evans@ita.doc.gov or (202) 

482–2350. 

Dated: December 20, 2007. 

Andrew McGilvray, 

Executive Secretary. 

[FR Doc. E8–113 Filed 1–7–08; 8:45 am] 

BILLING CODE 3510–DS–P 

DEPARTMENT OF COMMERCE 

Foreign-Trade Zones Board 

[Docket 53–2007] 

Foreign-Trade Zone 38—-Spartanburg 

County, SC; Application for Expansion 

An application has been submitted to 

the Foreign-Trade Zones (FTZ) Board 

(the Board) by the South Carolina State 

Ports Authority, grantee of FTZ 38, 

requesting authority to expand its 

existing zone to include additional sites 

in the Greenville-Spartanburg, South 

Carolina Customs and Border Protection 

port of entry. The application was 

submitted pursuant to the provisions of 

the Foreign-Trade Zones Act, as 

amended (19 U.S.C. 81a–81u), and the 

regulations of the Board (15 CFR Part 

400). It was formally filed on December 

20, 2007. 

FTZ 38 was approved by the Board on 

May 4, 1978 (Board Order 131, 43 FR 

20526, 5/12/78) and expanded as 

follows: on November 9, 1994 (Board 

Order 715, 59 FR 59992, 11/21/94); on 

July 23, 1997 (Board Order 910, 62 FR 

40797, 7/30/97); on January 8, 1999 

(Board Order 1015, 64 FR 3064, 1/8/99); 

and, on July 21, 2005 (Board Order 

1404, 70 FR 44559). 

The general-purpose zone project 

currently consists of seven sites (1,546 

acres) in Spartanburg County/Laurens 

Counties: Site 1 (20 acres)—within the 

74-acre Global Trade Center located at 

200 Forest Way, Greenville; Site 2 (799 

acres)—International Transport Center 

(111 acres) and Gateway International 

Business Center (688 acres), Greer; Site 

3 (97 acres)—Highway 290 Commerce 

Park (111 acres) and a warehouse 

facility (5 acres) located at 150 Parkway 

West, Duncan; Site 4 (473 acres)—

Wingo Corporate Park, Spartanburg; Site 

5 (118 acres)—TNT Logistics/Michelin 

North America, Inc., facility located at 

101 Michelin Drive, Laurens; Site 6 (20 

acres)—Lakeside Business Center 

located at 961 Berry Shoals Road in 

Greer; and, Temporary Site T–1 (19 

acres)—ZF Lemforder Corporation, 240 

Parkway East, in Duncan. 

The applicant is now requesting 

authority to expand the general-purpose 

zone to include five additional sites in 

the area: Proposed Site 8 (88 acres)—

Riverbend Business Center, located at 

Cedar Crest Road and Compton Road, 

Spartanburg; Proposed Site 9 (207 

acres)—Corporate Center I–85 (193 

acres, 2 parcels), located at 100 

Corporate Center Drive, Spartanburg; 

and the Bryant Business Center (14 

acres, 1 parcel), located at 140 Landers 

Drive, Spartanburg; Proposed Site 10 

(334 acres, 2 parcels)—Interchange 

Commerce Center, located at John Dodd 

Road and Interstate 26, Spartanburg; 

Proposed Site 11 (51 acres)—Caliber 

Ridge Industrial Park, 1501 Highway 

101 in Greer; and, Proposed Site 12 (4 

acres)—Industrial Warehousing, 100 

Fortis Drive, Duncan. The proposed 

sites are owned by Fairforest Venture 

Partners (Site 8), Peter E. Weisman/ 

Kinney Hill Associates, LP (Site 9), High 

Site and John Dodds Road Properties, 

LLC dba Johnson Development 

Associates, Inc. (Site 10), JLN Investors, 

Inc. (Site 11), and, Betula, LLC (Site 12). 

The sites will be used primarily for 

warehousing and distribution activities. 

No specific manufacturing authority is 

being requested at this time. Such 

requests would be made to the Board on 

a case-by-case basis. 

The applicant is also requesting that 

19 acres at Site 3 (Highway 290 

Commerce Park) be restored to zone 

status and that Temporary Site T–1 (19 

acres) located at 240 Parkway East in 

Duncan, be granted zone status on a 

permanent basis as Site 7. Additionally, 

the applicant is requesting that the 

Board make Site 1 permanent at the 

Global Trade Center in Greenville (Site 

1 was previously at the Highway 29 

Industrial Park in Wellford). 

In accordance with the Board’s 

regulations, a member of the FTZ staff 

has been designated examiner to 

investigate the application and report to 

the Board. 

Public comment is invited from 

interested parties. Submissions (original 

and 3 copies) shall be addressed to the 

Board’s Executive Secretary at the 

address listed below. The closing period 

for their receipt is March 10, 2008. 

Rebuttal comments in response to 

material submitted during the foregoing 

period may be submitted during the 

subsequent 15-day period to March 24, 

2008. 

A copy of the application and 

accompanying exhibits will be available 

for public inspection at each of the 

following locations: U.S. Department of 

Commerce Export Assistance Center, 

216 S. Pleasantburg Drive, Suite 243, 

Buck Mickel Center, Greenville, S.C. 

29607; and, Office of the Executive 

Secretary, Foreign-Trade Zones Board, 

Room 2111, U.S. Department of 

Commerce, 1401 Constitution Avenue 

NW., Washington, DC 20230. 

For further information, contact 

Christopher Kemp at 

christopher_kemp@ita.doc.gov or (202) 

482–0862. 

Dated: December 20, 2007. 

Andrew McGilvray, 

Executive Secretary. 

[FR Doc. E8–112 Filed 1–7–08; 8:45 am] 

BILLING CODE 3510–DS–P 

DEPARTMENT OF COMMERCE 

International Trade Administration 

[A–570–846] 

Brake Rotors from the People’s 

Republic of China: Notice of Final 

Results of Expedited Second Sunset 

Review of Antidumping Duty Order 

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce. 

SUMMARY: On July 2, 2007, the 

Department of Commerce (‘‘the 

Department’’) published a notice of 

initiation of a sunset review of the 

antidumping duty order on brake rotors 

from the People’s Republic of China 

(‘‘PRC’’) pursuant to section 751(c) of 

the Tariff Act of 1930, as amended (‘‘the 

Act’’). See Initiation of Five–Year 


pwalker on PROD1PC71 with NOTICES
1320 Federal Register / Vol. 73, No. 5 / Tuesday, January 8, 2008 / Notices 

1See the Department’s August 21, 2007, letter to 

the ITC, regarding ‘‘Expedited Sunset Review of the 

AD/CVD Order Initiated in July 2007.’’

2 In a 2007 scope ruling, the Department 

determined that brake rotors produced by FederalMogul and certified by Ford Motor Company are 

excluded from the scope of the order. See the 

January 17, 2007, Department memorandum 

entitled ‘‘Scope Ruling of the Antidumping Duty 

Order on Brake Rotors from the People’s Republic 

of China; Federal-Mogul Corporation.’’

3As of January 1, 2005, the HTSUS classification 

for brake rotors (discs) changed from 8708.39.5010 

to 8708.39.5030. As of January 1, 2007, the HTSUS 

classification for brake rotors (discs) changed from 

8708.39.5030 to 8708.30.5030. See Harmonized 

Tariff Schedule of the United States (2007) (Rev. 2), 

available at <www.usitc.gov> 

(‘‘Sunset’’) Reviews, 72 FR 35968 (July 

2, 2007) (‘‘Initiation Notice’’). On the 

basis of the notices of intent to 

participate, an adequate substantive 

response filed on behalf of a domestic 

interested party and an inadequate 

substantive response filed on behalf of 

a respondent interested party (i.e., a 

U.S. importer), the Department 

conducted an expedited (120–day) 

sunset review of the antidumping duty 

order pursuant to section 751(c)(3)(B) of 

the Act and section 

351.218(e)(1)(ii)(C)(2) of the 

Department’s regulations. As a result of 

this sunset review, the Department finds 

that revocation of the antidumping duty 

order would likely lead to continuation 

or recurrence of dumping at the levels 

indicated in the ‘‘Final Results of 

Review’’ section of this notice. 

EFFECTIVE DATE: January 8, 2008. 

FOR FURTHER INFORMATION CONTACT: 

Frances Veith, AD/CVD Operations, 

Office 8, Import Administration, 

International Trade Administration, 

U.S. Department of Commerce, 14th 

Street and Constitution Avenue, NW, 

Washington, DC 20230; telephone: (202) 

482–4295. 

SUPPLEMENTARY INFORMATION: 

Background 

On July 2, 2007, the Department 

published the notice of initiation of the 

second sunset review of the 

antidumping duty order on brake rotors 

from the PRC pursuant to section 751(c) 

of the Act. See Initiation Notice. On July 

17, 2007, the Department received a 

notice of intent to participate from a 

domestic interested party, the Coalition 

for the Preservation of American Brake 

Drum and Rotor Aftermarket 

Manufacturers (‘‘petitioner’’), within the 

deadline specified in section 

351.218(d)(1)(i) of the Department’s 

regulations, and from a respondent 

interested party, CWD, LLC (also known 

as Centric Parts) (‘‘CWD’’). Petitioner 

claimed interested party status under 

section 771(9)(C) of the Act as a 

domestic producer of brake rotors in the 

United States, and CWD claimed 

interested party status under section 

771(9)(A) of the Act as a U.S. importer 

of brake rotors into the United States. 

The Department received substantive 

responses from petitioner and CWD 

within the deadline specified in section 

351.218(d)(3)(i) of the Department’s 

regulations and rebuttal submissions to 

those responses from petitioner and 

CWD on August 1 and August 6, 2007, 

respectively. On August 21, 2007, 

petitioner submitted to the Department 

a correction to its August 6, 2007, 

rebuttal response. On August 21, 2007, 

the Department notified the 

International Trade Commission (‘‘ITC’’) 

that respondent interested parties did 

not provide an adequate substantive 

response in this sunset review pursuant 

to section 751(c)(3)(B) of the Act. 

Therefore, because we did not receive 

an adequate substantive response from 

the respondent interested party, we 

determined to conduct an expedited 

review of the order pursuant to section 

751(c)(3)(B) of the Act and section 

351.218(e)(1)(ii)(C)(2) of the 

Department’s regulations.1 On 

November 5, 2007, the Department 

published a notice extending the time 

limit for the completion of the final 

results of this review until November 

29, 2007. See Brake Rotors from the 

People’s Republic of China: Extension of 

Final Results of Expedited Sunset 

Review of Antidumping Duty Order, 72 

FR 62430 (November 5, 2007). On 

December 5, 2007, the Department 

published a notice extending the time 

limit for the completion of the final 

results of this review until December 31, 

2007. See Brake Rotors from the 

People’s Republic of China: Extension of 

Time Limit for Final Results of 

Expedited Sunset Review of 

Antidumping Duty Order, 72 FR 68562 

(December 5, 2007). 

Scope of the Order 

The products covered by this order 

are brake rotors made of gray cast iron, 

whether finished, semifinished, or 

unfinished, ranging in diameter from 8 

to 16 inches (20.32 to 40.64 centimeters) 

and in weight from 8 to 45 pounds (3.63 

to 20.41 kilograms). The size parameters 

(weight and dimension) of the brake 

rotors limit their use to the following 

types of motor vehicles: automobiles, 

all–terrain vehicles, vans and 

recreational vehicles under ‘‘one ton 

and a half,’’ and light trucks designated 

as ‘‘one ton and a half.’’

Finished brake rotors are those that 

are ready for sale and installation 

without any further operations. Semi–

finished rotors are those on which the 

surface is not entirely smooth, and have 

undergone some drilling. Unfinished 

rotors are those which have undergone 

some grinding or turning. 

These brake rotors are for motor 

vehicles, and do not contain in the 

casting a logo of an original equipment 

manufacturer (‘‘OEM’’) which produces 

vehicles sold in the United States. (e.g., 

General Motors, Ford, Chrysler, Honda, 

Toyota, Volvo). Brake rotors covered in 

this order are not certified by OEM 

producers of vehicles sold in the United 

States. The scope also includes 

composite brake rotors that are made of 

gray cast iron, which contain a steel 

plate, but otherwise meet the above 

criteria. Excluded from the scope of this 

order are brake rotors made of gray cast 

iron, whether finished, semifinished, or 

unfinished, with a diameter less than 8 

inches or greater than 16 inches (less 

than 20.32 centimeters or greater than 

40.64 centimeters) and a weight less 

than 8 pounds or greater than 45 pounds 

(less than 3.63 kilograms or greater than 

20.41 kilograms).2

Brake rotors are currently classifiable 

under subheadings 8708.39.5010, 

8708.39.5030, and 8708.30.5030 of the 

Harmonized Tariff Schedule of the 

United States (‘‘HTSUS’’).3 Although 

the HTSUS subheadings are provided 

for convenience and customs purposes, 

the written description of the scope of 

this order is dispositive. 

Analysis of Comments Received 

All issues raised in this review are 

addressed in the ‘‘Issues and Decision 

Memorandum’’ (‘‘Decision 

Memorandum’’) from Stephen J. Claeys, 

Deputy Assistant Secretary for Import 

Administration, to David M. Spooner, 

Assistant Secretary for Import 

Administration, dated concurrently 

with this notice, which is hereby 

adopted by this notice. The issues 

discussed in the Decision Memorandum 

include consideration of substantive 

responses, the likelihood of 

continuation or recurrence of dumping 

and the magnitude of the margins likely 

to prevail if the order were revoked. 

Parties can find a complete discussion 

of all issues raised in this review and 

the corresponding recommendations in 

this public memorandum, which is on 

file in the Central Records Unit in room 

B–099 of the main Commerce building. 

In addition, a complete version of the 

Decision Memorandum can be accessed 

directly on the web at <http:// 

ia.ita.doc.gov/frn>. The paper copy and 

electronic version of the Decision 

Memorandum are identical in content. 


pwalker on PROD1PC71 with NOTICES
Federal Register / Vol. 73, No. 5 / Tuesday, January 8, 2008 / Notices 1321 

6See Notice of Antidumping Duty Order: Brake 

Rotors from the People’s Republic of China, 62 FR 

18740 (April 17, 1997). 

7See Policies Regarding the Conduct of Five-year 

(‘‘Sunset’’) Reviews of Antidumping and 

Countervailing Duty Orders; Policy Bulletin, 63 FR 

18871, 18873 (April 16, 1998). 

Final Results of Review 

Pursuant to section 752(c)(3) of the 

Act, we determine that revocation of the 

antidumping duty order on brake rotors 

from the PRC would likely lead to 

continuation or recurrence of dumping 

at the following weighted–average 

percentage margins: 

Manufacturers/Exporters/Producers Weighted–Average Margin 

(percent) 

Hebei Metals and Minerals Import/export Corp. ....................................................................................................... 8.51 

Shandong Jiuyang Enterprise Corporation ............................................................................................................... 8.51 

Longjing Walking Tractor Works Foreign Trade I/E .................................................................................................. 8.51 

Jilin Provincial Machinery & Equipment I/E Corp ...................................................................................................... 8.51 

Qingdao Metals, Minerals and Machinery Import & Export Corporation .................................................................. 8.51 

Shanxi Machinery and Equipment Import & Export Corporation .............................................................................. 8.51 

Southwest Technical Import and Export Corporation ............................................................................................... 16.07 

Xianghe Zichen Casting Corporation ........................................................................................................................ 8.51 

Yantai Import and Export Corporation ....................................................................................................................... 3.56 

Yenhere Corporation ................................................................................................................................................. 8.51 

PRC–Wide Entity ....................................................................................................................................................... 43.32 

Excluded from the antidumping duty 

order are the following exporters and 

producer combinations:6

Exporter: China National Automotive 

Industry Import &Export 

Corporation 

Producer: Shandong Laizhou CAPCO 

Industry; 

Exporter: Shandong Laizhou CAPCO 

Industry 

Producer: Shandong Laizhou CAPCO 

Industry; 

Exporter: Shenyang Honbase 

Machinery Co., Ltd. 

Producer: Shenyang Honbase 

Machinery Co., Ltd.; 

Exporter: Shenyang Honbase 

Machinery Co., Ltd. 

Producer: Lai Zhou Luyan 

Automobile Fittings Co., Ltd.; 

Exporter: Lai Zhou Luyuan 

Automobile Fittings Co., Ltd. 

Producer: Lai Zhou Luyuan 

Automobile Fittings Co., Ltd.; 

Exporter: Lai Zhou Luyan Automobile 

Fittings Co., Ltd. 

Producer: Shenyang Honbase or 

Laizhou Luyuan; and 

Exporter: China National Machinery 

and Equipment I&E (Xinjiang) 

Corporation, Ltd. 

Producer: Zibo Botai Manufacturing 

Co., Ltd. 

In a five–year sunset review, it is the 

Department’s policy to include 

companies that did not begin exporting 

until after the order was issued as part 

of the PRC–wide entity from the 

investigation.7 For those companies that 

shipped after the order was issued, we 

determine that revocation of the 

antidumping duty order on brake rotors 

from the PRC would be likely to lead to 

continuation or recurrence of dumping 

at the PRC–wide percentage margin. 

Notification Regarding Administrative 

Protective Order: 

This notice also serves as the only 

reminder to parties subject to 

administrative protective orders 

(‘‘APO’’) of their responsibility 

concerning the return or destruction of 

proprietary information disclosed under 

APO in accordance with section 351.305 

of the Department’s regulations. Timely 

notification of the return or destruction 

of APO materials or conversion to 

judicial protective order is hereby 

requested. Failure to comply with the 

regulations and terms of an APO is a 

violation which is subject to sanction. 

We are issuing and publishing these 

results and this notice in accordance 

with sections 751(c), 752(c) and 

777(i)(1) of the Act. 

Dated: December 31, 2007. 

Susan H. Kuhbach, 

Acting Assistant Secretary for Import 

Administration. 

[FR Doc. E8–116 Filed 1–7–08; 8:45 am] 

BILLING CODE 3510–DS–S 

DEPARTMENT OF COMMERCE 

International Trade Administration 

A–351–832, A–122–840, A–560–815, A–201–

830, A–841–805, A–274–804, A–823–812 

Carbon and Certain Alloy Steel Wire 

Rod from Brazil, Canada, Indonesia, 

Mexico, Moldova, Trinidad and 

Tobago, and Ukraine: Final Results of 

the Expedited Sunset Reviews of the 

Antidumping Duty Orders 

AGENCY: Import Administration, 

International Trade Administration, 

Department of Commerce. 

SUMMARY: On September 4, 2007, the 

Department of Commerce (‘‘the 

Department’’) initiated sunset reviews of 

the antidumping duty orders on carbon 

and certain alloy steel wire rod (‘‘wire 

rod’’) from Brazil, Canada, Indonesia, 

Mexico, Moldova, Trinidad and Tobago, 

and Ukraine pursuant to section 751(c) 

of the Tariff Act of 1930, as amended 

(‘‘the Act’’). The Department has 

conducted expedited (120–day) sunset 

reviews for these orders pursuant to 19 

CFR 351.218(e)(1)(ii)(C)(2). As a result 

of these sunset reviews, the Department 

finds that revocation of the antidumping 

duty orders would be likely to lead to 

continuation or recurrence of dumping. 

EFFECTIVE DATE: January 8, 2008. 

FOR FURTHER INFORMATION CONTACT: 

Devta Ohri or Brandon Farlander, AD/ 

CVD Operations, Office 1, Import 

Administration, International Trade 

Administration, U.S. Department of 

Commerce, 14th Street & Constitution 

Avenue, NW, Washington, DC 20230; 

telephone: (202) 482–3853, or (202) 

482–0182, respectively. 

SUPPLEMENTARY INFORMATION: 

Background 

On September 4, 2007, the 

Department published the notice of 

initiation of the sunset reviews of the 

antidumping duty orders on wire rod 

from Brazil, Canada, Indonesia, Mexico, 

Moldova, Trinidad and Tobago, and 

Ukraine, pursuant to Section 751(c) of 

the Act. See Initiation of Five–Year 

(‘‘Sunset’’) Reviews, 72 FR 50659 

(September 4, 2007) (‘‘Notice of 

Initiation’’). 

The Department received a notice of 

intent to participate from the following 

domestic parties: Gerdau Ameristeel 

U.S. Inc.; ISG Georgetown, Inc.; 

Keystone Consolidated Industries, Inc.; 

and Rocky Mountain Steel Mills within 

the deadline specified in 19 CFR 

351.218(d)(1)(i). The companies claimed 


pwalker on PROD1PC71 with NOTICES
1

The Commission also received responses from Best Brakes, IAP West Inc., and Qualis

Automotive LLC, which are purchasers and/or consignees of subject merchandise imported by others and,

therefore, are not “interested parties” as defined by 19 U.S.C. § 1677(9).

EXPLANATION OF COMMISSION DETERMINATION ON ADEQUACY

in

Brake Rotors from China

Inv. No. 731-TA-744 (Second Review)

On October 5, 2007, the Commission determined that it should proceed to a full review in the

subject five-year review pursuant to section 751(c)(5) of the Tariff Act of 1930, as amended, 19 U.S.C. §

1675(c)(5)). 

The Commission unanimously determined that the domestic interested party group response to

the notice of institution was adequate. The Commission received an adequate response from the Coalition

for the Preservation of American Brake Drum and Rotor Aftermarket Manufacturers, an unincorporated

association of two domestic producers of brake rotors, Federal-Mogul, Inc. and Affinia Group, Inc.,

which included individually adequate responses for the two producers. Because the Commission received

an adequate response from producers accounting for the vast majority of U.S. production of brake rotors,

the Commission determined that the domestic interested party group response was adequate. 

The Commission unanimously determined that the respondent interested party group response

was adequate. The Commission received adequate responses from Chinese producers and exporters

Qingdao Meita Automotive Industry Co., Ltd.; Longkou Jinzheng Machinery Co., Ltd.; Longkou

Haimeng Machinery Co., Ltd.; Longkou TLC Machinery Co., Ltd.; Laizhou Hongda Auto Replacement

Parts Co., Ltd.; World Known Precision Industry (Fuzhou) Co., Ltd.; Shandong Huanri Group Co., Ltd.;

Shanxi Zhongding Auto Parts Co., Ltd.; Laizhou Wally Automobile Co., Ltd.; Laizhou City Luqi

Machinery Co., Ltd.; Yantai Winhere Auto-Part Manufacturing Co., Ltd.; Qingdao Gren (Group) Co.,

and from U.S. importers CWD, LLC dba Centric Parts; Gren Automotive, Inc.; and Ziway, Inc.1

 Because

the Commission received an adequate response from producers and exporters accounting for the majority

of the total volume of exports of subject merchandise to the United States in 2006, as well as from

importers accounting for some volume of U.S. imports of subject merchandise, the Commission

determined that the Chinese respondent interested party group response was adequate. Accordingly, the

Commission determined to proceed to a full review. 

A record of the Commissioners’ votes is available from the Office of the Secretary and at the

Commission’s web site, http://www.usitc.gov. 
B-1

APPENDIX B

CALENDAR OF THE PUBLIC HEARING

CALENDAR OF PUBLIC HEARING

Those listed below appeared as witnesses at the United States International Trade Commission’s

hearing:

Subject: Brake Rotors from China

Inv. No.: 731-TA-744 (Second Review)

Date and Time: April 15, 2008 - 9:30 a.m.

Sessions were held in connection with this review in the Main Hearing Room, 500 E Street, SW,

Washington, DC.

OPENING REMARKS:

In Support of Revocation of the Antidumping Duty Order (Lyle B. Vander Schaaf, Bryan Cave LLP)

In Support of the Revocation of the Antidumping Duty Order:

Bryan Cave LLP

Washington, DC

on behalf of

Chinese respondents and certain U.S.

 importers and purchasers

Steve Hughes, Director, Integrated Supply Chain, CWD

Marvin J. Fudalla, President and CEO, Qualis Automotive LLC

Greg Woo, Vice President, Performance Operations, CWD

Jenny Zhang, Sales Manager, Longkou Haimeng Machinery Co., Ltd.

Felipe Berer, Senior International Trade Advisor, Bryan Cave LLP

Lyle B. Vander Schaaf – OF COUNSEL

Mayer Brown LLP

Washington, DC

on behalf of

Federal-Mogul Corp. (“Federal-Mogul”)

Dennis Wappelhorst, Director, Chassis, Brake, and Fuel Operations, Federal-Mogul

Duane W. Layton ) – OF COUNSEL Sydney H. Mintzer)

CLOSING REMARKS:

In Support of Revocation of the Antidumping Duty Order (Lyle Vander Schaaf, Bryan Cave LLP)

B-3
 
C-1

APPENDIX C

SUMMARY DATA

Table C-1

Brake rotors: Summary data concerning the U.S. market, 2002-07

(Quantity=1,000 rotors, value=1,000 dollars, unit values, unit labor costs, and unit expenses are per rotor; period changes=percent, except where noted)

Reported data Period changes

Item 2002 2003 2004 2005 2006 2007 2002-07 2002-03 2003-04 2004-05 2005-06 2006-07

U.S. consumption quantity:

 Amount . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Producers' share (1) . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Importers' share (1):

 China (subject) . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 China (nonsubject) . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 All other sources . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Total imports . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

U.S. consumption value:

 Amount . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Producers' share (1) . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Importers' share (1):

 China (subject) . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 China (nonsubject) . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 All other sources . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Total imports . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

U.S. imports from:

 China (subject) :

 Quantity . . . . . . . . . . . . . . . . . . 7,703 12,882 14,961 17,743 23,796 33,073 329.4 67.2 16.1 18.6 34.1 39.0

 Value . . . . . . . . . . . . . . . . . . . . 52,315 93,412 117,655 158,994 202,200 283,907 442.7 78.6 26.0 35.1 27.2 40.4

 Unit value . . . . . . . . . . . . . . . . . $6.79 $7.25 $7.86 $8.96 $8.50 $8.58 26.4 6.8 8.4 14.0 -5.2 1.0

 Ending inventory quantity . . . . . 694 1,271 1,447 1,515 4,915 6,582 848.6 83.2 13.9 4.7 224.3 33.9

 China (nonsubject) :

 Quantity . . . . . . . . . . . . . . . . . . 5,549 6,951 3,809 4,570 7,738 13,492 143.1 25.3 -45.2 20.0 69.3 74.4

 Value . . . . . . . . . . . . . . . . . . . . 32,822 44,162 26,952 32,027 51,310 100,468 206.1 34.5 -39.0 18.8 60.2 95.8

 Unit value . . . . . . . . . . . . . . . . . $5.91 $6.35 $7.08 $7.01 $6.63 $7.45 25.9 7.4 11.4 -1.0 -5.4 12.3

 Ending inventory quantity . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 All other sources:

 Quantity . . . . . . . . . . . . . . . . . . 42,300 38,075 32,259 39,658 41,691 37,170 -12.1 -10.0 -15.3 22.9 5.1 -10.8

 Value . . . . . . . . . . . . . . . . . . . . 592,580 565,743 523,590 472,382 538,848 507,633 -14.3 -4.5 -7.5 -9.8 14.1 -5.8

 Unit value . . . . . . . . . . . . . . . . . $14.01 $14.86 $16.23 $11.91 $12.92 $13.66 -2.5 6.1 9.2 -26.6 8.5 5.7

 Ending inventory quantity . . . . . 197 283 379 497 517 654 231.6 43.7 33.6 31.3 4.0 26.4

 All sources:

 Quantity . . . . . . . . . . . . . . . . . . 55,551 57,908 51,030 61,971 73,225 83,735 50.7 4.2 -11.9 21.4 18.2 14.4

 Value . . . . . . . . . . . . . . . . . . . . 677,717 703,317 668,197 663,403 792,358 892,009 31.6 3.8 -5.0 -0.7 19.4 12.6

 Unit value . . . . . . . . . . . . . . . . . $12.20 $12.15 $13.09 $10.71 $10.82 $10.65 -12.7 -0.4 7.8 -18.2 1.1 -1.6

 Ending inventory quantity . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

U.S. producers':

 Average capacity quantity . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Production quantity . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Capacity utilization (1) . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 U.S. shipments:

 Quantity . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Value . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Unit value . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Export shipments:

 Quantity . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Value . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Unit value . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Ending inventory quantity . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Inventories/total shipments (1) . . *** *** *** *** *** *** *** *** *** *** *** ***

 Production workers . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Hours worked (1,000s) . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Wages paid ($1,000s) . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Hourly wages . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Productivity (rotors per hour) . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Unit labor costs . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Net sales:

 Quantity . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Value . . . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Unit value . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Cost of goods sold (COGS) . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Gross profit or (loss) . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 SG&A expenses . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Operating income or (loss) . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Capital expenditures . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Unit COGS . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Unit SG&A expenses . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Unit operating income or (loss) . *** *** *** *** *** *** *** *** *** *** *** ***

 COGS/sales (1) . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 Operating income or (loss)/

 sales (1) . . . . . . . . . . . . . . . . . . *** *** *** *** *** *** *** *** *** *** *** ***

 (1) "Reported data" are in percent and "period changes" are in percentage points.

Note.--Financial data are reported on a fiscal year basis and may not necessarily be comparable to data reported on a calendar year basis. Because of rounding, figures may not add to the totals shown.

Unit values and shares are calculated from the unrounded figures.

Note: China (subject) import quantity is the quantity of exports to the United States reported in foreign producer questionnaires. Value is constructed by multiplying the unit value of U.S. imports

of subject product from the importer questionnaires to this quantity.

Note: Data for China (nonsubject) imports consist of official statistics (CNIF) for excluded companies only (Laizhou CAPCO, Shenyang Honbase, and Zibo Botai).

Source: Compiled from data submitted in response to Commission questionnaires and from official Commerce statistics.

C-3
C-4

Table C-2

Brake rotors: U.S. imports, by sources, 2002-07

Source

Calendar year

2002 2003 2004 2005 2006 2007

Quantity (1,000 rotors)

China (nonsubject) 5,549 6,951 3,809 4,570 7,738 13,492

China (other, including subject) 22,803 29,523 30,213 28,291 35,324 44,953

 Total, China 28,352 36,474 34,022 32,861 43,062 58,445

Other sources1 42,299 38,075 32,260 39,657 41,692 37,171

Total 70,651 74,549 66,282 72,518 84,754 95,616

Value (1,000 dollars)

2

China (nonsubject) 32,822 44,162 26,952 32,027 51,310 100,468

China (other, including subject) 146,496 191,344 213,907 210,822 265,086 368,519

 Total, China 179,318 235,506 240,859 242,849 316,396 468,987

Other sources1 592,580 565,743 523,590 472,382 538,848 507,633

Total 771,898 801,249 764,449 715,231 855,244 976,621

Unit value (per rotor)

China (nonsubject) $5.92 $6.35 $7.08 $7.01 $6.63 $7.45

China (other, including subject) 6.42 6.48 7.08 7.45 7.50 8.20

 Total, China 6.32 6.46 7.08 7.39 7.35 8.02

Other sources1 14.01 14.86 16.23 11.91 12.92 13.66

Total 10.93 10.75 11.53 9.86 10.09 10.21

Table continued on following page.
C-5

Table C-2--Continued

Brake rotors: U.S. imports, by sources, 2002-07

Source

Calendar year

2002 2003 2004 2005 2006 2007

Share of quantity (percent)

China (nonsubject) 7.9 9.3 5.7 6.3 9.1 14.1

China (other, including subject) 32.3 39.6 45.6 39.0 41.7 47.0

 Total, China 40.1 48.9 51.3 45.3 50.8 61.1

Other sources1 59.9 51.1 48.7 54.7 49.2 38.9

Total 100.0 100.0 100.0 100.0 100.0 100.0

Share of value (percent)

China (nonsubject) 4.3 5.5 3.5 4.5 6.0 10.3

China (other, including subject) 19.0 23.9 28.0 29.5 31.0 37.7

 Total, China 23.2 29.4 31.5 34.0 37.0 48.0

Other sources1 76.8 70.6 68.5 66.0 63.0 52.0

Total 100.0 100.0 100.0 100.0 100.0 100.0

Ratio of import quantity to U.S. production (percent)

China (nonsubject) *** *** *** *** *** ***

China (other, including subject) *** *** *** *** *** ***

 Total, China *** *** *** *** *** ***

Other sources1 *** *** *** *** *** ***

Total *** *** *** *** *** ***

 1 The leading nonsubject country suppliers for imports entering the United States under HTS 8708.30.5030

during 2007 (and their shares of the total quantity of U.S. imports of all brake rotors) were as follows: Mexico (19.2

percent); Canada (7.2 percent); Germany (3.8 percent); Brazil and Taiwan (2.0 percent each); and Japan (1.8

percent). 

 2

 Landed, duty-paid.

Note.--Prior to July 2004, aftermarket brake rotors were imported into the United States under HTS statistical

reporting number 8708.39.5010, a category that included not only the subject merchandise, but also included

merchandise that was outside Commerce’s scope (e.g., OEM brake rotors, aftermarket and OEM brake drums;

products not of gray cast iron (namely, aluminum); and products which do not meet the specified size parameters

(including such parts for use in larger-sized vehicles)). This classification also included castings, unfinished, and

semifinished products that were shipped into the United States for final processing, provided that they were

identifiable as parts of brakes at entry. The HTS statistical reporting number specific to rotors, HTS 8708.39.5030

(brake rotors (discs) for motor vehicles), was created in July 2004. This HTS category was narrower than the

previous HTS category in that it no longer included brake drums; however, it was still a broader product grouping

than the subject merchandise in that it also included OEM brake rotors and other products that do not meet the

specified size parameters. With the HTS nomenclature revision in 2007, U.S. imports of the subject brake rotors

are currently imported under HTS statistical reporting number 8708.30.5030.

Source: Compiled from official Commerce statistics.
 
D-1

APPENDIX D

RESPONSES OF U.S. PRODUCERS, U.S. IMPORTERS, U.S. PURCHASERS,

AND CHINESE PRODUCERS CONCERNING THE SIGNIFICANCE OF THE

ANTIDUMPING DUTY ORDER AND THE LIKELY EFFECTS OF

REVOCATION

D-3

U.S. PRODUCERS’ COMMENTS REGARDING THE SIGNIFICANCE OF THE

ANTIDUMPING DUTY ORDER AND THE LIKELY EFFECTS OF REVOCATION

The Commission requested U.S. producers to describe any anticipated changes to the character of

their operations or organization relating to the production of aftermarket brake rotors in the future

if the subject antidumping duty order were to be revoked. (Question II-6.) The following are

quotations from the responses of U.S. producers.

Affinia

“***.”

Federal-Mogul

“***.”

ThyssenKrupp Waupaca Inc.

“***.”

The Commission requested U.S. producers to describe the significance of the existing subject

antidumping duty order on aftermarket brake rotors in terms of its effect on their firms’

production capacity, production, U.S. shipments, inventories, purchases, employment, revenues,

costs, profits, cash flow, capital expenditures, research and development expenditures, and asset

values. The Commission also requested U.S. producers to compare their operations before and

after the imposition of the order. (Question II-17.) The following are quotations from the

responses of U.S. producers.

Affinia

“***.”

Federal-Mogul

“***.”

ThyssenKrupp Waupaca Inc.

***.
D-4

The Commission requested U.S. producers to describe any anticipated changes in their production

capacity, production, U.S. shipments, inventories, purchases, employment, revenues, costs, profits,

cash flow, capital expenditures, research and development expenditures, or asset values relating to

the production of aftermarket brake rotors in the future if the subject antidumping duty order

were to be revoked. (Question II-18.) The following are quotations from the responses of U.S.

producers.

Affinia

“***.”

Federal-Mogul

“***.”

ThyssenKrupp Waupaca Inc.

“***.”

U.S. IMPORTERS’ COMMENTS REGARDING THE SIGNIFICANCE OF THE

ANTIDUMPING DUTY ORDER AND THE LIKELY EFFECTS OF REVOCATION

The Commission requested U.S. importers to describe any anticipated changes in the character of

their operations or organization relating to the importation of aftermarket brake rotors in the

future if the subject antidumping duty order was revoked. (Question II-4.) The following are

quotations from the responses of importers.

***

“Yes. There are many small Chinese facilities that will have an influx of rotors at less than fair value

costs.”

***

“Yes. We will reduce purchasing from local vendors and will increase direct imports from China.”

***

“No.”

***

“No.”

***

“No.”
D-5

***

“No.”

***

“No, irrelevant.”

***

“No.”

***

“Yes. If the antidumping order is revoked, the U.S. market probably will be adversely affected because a

large volume of low-priced, lower quality rotors would flood the U.S. market at significantly lower

prices. Currently, the antidumping order helps stabilize the market and provides some discipline to

Chinese exporters.”

***

“No.”

***

“No.”

***

“No.”

***

“No. Company closed.”

***

“No.”

***

“Yes. We may be able to compete more effective with other importers but the market condition is rather

complicated. It is very difficult to forecast the time, nature, and significance of market conditions at this

point of time.”

***

“No.”
D-6

***

“Yes. In order to have an even playing field it is important to have an equal duty for all suppliers,

whether the duty is revoked or not.”

***

“No.”

***

“Yes. We may resume our operation to meet the market demands.”

***

“No.”

***

“No.”

The Commission requested U.S. importers to describe the significance of the existing antidumping

duty order on aftermarket brake rotors in terms of its effect on their imports, U.S. shipments of

imports, and inventories. (Question II-10.) The following are quotations from the responses of

importers.

***

“The intent of the order was to prevent the shipment of product at less than fair market value. 

Continuation of the order will lessen the injury in the future. Particularly the risk of dumping by

numerous potential new entrants to the U.S. export market who are discouraged from exporting now by

the China Wide rate of 43.3% that they would have to pay.”

***

“Because of antidumping duty order, it is very hard to keep up with customers’ demands of aftermarket

brake rotors from China. Also, we have to pay much more to local vendors in our area.”

***

“The current order impacts our sourcing decisions. A firm with a zero rate is more attractive to purchase

from than a firm with the PRC rate or higher.”

***

“None.”
D-7

***

“The existing antidumping duty order limits import volumes. Due to competitiveness and cost issue, we

stopped importing this products year 2006. The last import year was 2005.”

***

“N/A - Our company did not exist before the imposition of this order.”

***

“Irrelevant.”

***

“No big influence before and after imposition of the order.”

***

“We imported primarily from exporters who were found not to be dumping in the original investigation. 

Although our import volumes have increased since the order was imposed, our import volume from these

suppliers has been consistent with the overall increase in market demand as newer models come on line

that were not being supplied by U.S. producers. The antidumping duty order has blocked Chinese

producers who will sell at any price, thus preventing destabilization of U.S. market prices.”

***

“The current anti-dumping duty order creates more work, i.e., Customs for example. If the order were to

be revoked, it would only be a positive allowing us to be an equal with those companies who are not

currently affected who are also importing like products from China.”

***

“No significant effect.”

***

“We are no longer the importer of record on rotors. We are buying through a U.S. company.”

***

“The company closed and went out of business.”

***

No response.
D-8

***

“The existing antidumping duty order has significantly helped to reduce our imports; as a result, we have

to reconsider our business options.”

***

“Lower margins.”

***

“We only hope for a more democratic industry where all suppliers are subject to the same duties.”

***

“As a result of this anti-dumping order, our Company was forced to reconsider its business with the

manufacturers involved. This resulted in a decision which led to the temporary halt on our importation

completely. We don’t carry any inventories.”

***

“We no longer import Chinese rotors.”

***

“We did not see much significance as the product is no longer made in the U.S.”

***

“Our company started in 2005. Cannot compare. Import & sale started in 2006.”

The Commission requested U.S. importers to describe any anticipated changes in their imports,

U.S. shipments of imports, or inventories of aftermarket brake rotors in the future if the subject 

antidumping duty order on aftermarket brake rotors was revoked. (Question II-11.) The following

are quotations from the responses of importers.

***

“Yes. Sales would be reduced as customers may want to buy direct from Chinese suppliers. Imports

from China would also increase and close down production in the US.”

***

“Yes. If antidumping duty order is revoked, then our firm will expand aftermarket brake rotors

inventories, and same time we will increase our imports from China.”
D-9

***

“Yes. If the order is revoked, I believe it would promote increased competition between Chinese

factories, as the potential revocation would level the playing field from a cost basis. Of course quality

and delivery would still be important factors. How much competition is hard to say. It is my

understanding that a lot of capacity is going to export markets other than the U.S.”

***

“No.”

***

“Yes. If this order is revoked, more rotors will come into USA freely. The prices for retail will remain

same or lower.”

***

“No.”

***

“No. Irrelevent.”

***

“No.”

***

“If the antidumping order is revoked, we would face significant price pressure from Chinese exporters

currently subject to the order as they would try to sell at very low prices to capture market share and drive

down prices for everyone.”

***

“No.”

***

“No.”

***

“No.”

***

“No.”
D-10

***

“No.”

***

“If the antidumping duty order were to be revoked, we would anticipate a long term turn around in the

amount of imports because the demand remains the same in the US market.”

***

“No.”

***

“Yes. We believe that democracy would improve productivity and profitability.”

***

“Yes. We would probably import rotors from China again.”

***

“Should the antidumping duty order be revoked, our business may resume in a matter of a few months to

original operation.”

***

“No.”

***

“No.”
D-11

U.S. PURCHASERS’ COMMENTS REGARDING THE SIGNIFICANCE OF THE

ANTIDUMPING DUTY ORDER AND THE LIKELY EFFECTS OF REVOCATION

Effects on Future Activities of the Firms and the U.S. Market as a Whole (Question III-36) 

The Commission asked purchasers to comment on the likely effects of the revocation of the

antidumping duty order on imports of aftermarket brake rotors from China on (1) the future

activities of their firms and (2) the U.S. market as a whole. Their responses are as follows:

Effects on firm:

***

“The US Automotive Aftermarket has undergone many changes /improvements since 1997. Back in the

late 1990's when the order under review was implemented; many US producers of Automotive Brake

Rotors existed in the USA and North America. The order leveled the playing field for these US

manufacturers to remain competitive in the aftermarket against Chinese Imports.”

“However, the increased importation of brake rotors from other countries really spawned an industry here

in the USA of smaller niche brake systems suppliers that could compete with US producers of brake

systems.”

“The Major players in the US Aftermarket Brake Industry in 1997 were Raybestos, Bendix, Wagner, and

EIS. Since that time most of these companies are merely a shell of what they once were. EIS was bought

out by Federal Mogul who owns the Wagner Brand, who is currently in Chapter 11 Bankruptcy

protection. Raybestos has been bought and sold several times. They are currently owned and operated by

an investment capital group. Further, they are now a purchasing and marketing company, and they no

longer are a primary manufacturer. Bendix owned by Honeywell has been in and out of financial

difficulty for many years. The Automotive Aftermarket Portion of which is for sale. What caused all

this upheaval? It has been my observation that much of these closings, consolidations, and sales were

caused by these major US manufacturers failure to adapt quickly or at all to changes in the market and the

world economy.”

“Many companies began importing Chinese Brake Rotors as a companion product to their Manufacturer

Branded premium product. This dual line switch began on only the fast moving part numbers to help the

Jobber or WD increase their margins. Even the Premium US Manufacturers offered short lines of

economy priced product produced in China or alternative countries to help their full line suppliers offer a

lower cost higher margin product.”

“Initially China had its share of quality and delivery problems which kept the growth of Chinese Rotors

slow for many years, most of the early to mid 1990s. Once Chinese Manufacturers were able to upgrade

their machining equipment and processes, the Chinese product improved greatly and the consistency of

quality improved, as well as logistics.”

“These improvements along with Technology, a favorable exchange rate and a growing Chinese

Economy, made it possible for smaller US companies to work with Chinese Manufacturers to develop a

full range of Brake Rotors. Some companies coupled the purchase of Chinese Rotors with the global 

development of other brake categories like Brake Pads, Hydraulic Cylinders, Brake Shoes, etc to develop

full brake systems programs. The sourcing of many categories along with the correct parts information,
D-12

packaging, and marketing allowed smaller companies to become reputable full line brake systems

suppliers regionally and nation wide. Companies such as Autopart International, Auto Specialty, Centric,

IAP Dura International, etc. evolved and challenged the major manufacturers in the market. Still however

major manufacturers continued to believe that their name brand was worth more that it really was to the

customer. Major Manufacturers kept their prices high to cover their overhead and marketing costs while

the smaller companies worked at sourcing and product development to erode the major manufacturers

market share. Over time most of these major manufacturers either had to change, or they simply went

away.”

“It is my opinion that Chinese Brake Rotors did not harm the US Manufacturer, the US Manufacturer

harmed themselves by failing to see and respond to the globalization that was going on around them. 

Finally when these major US Manufacturers kept losing market share, they tried to respond, but it was

just too late in many cases. Now these major manufacturers either own brake rotor factories in China or

source from factories in China.”

“Looking forward, I see all that we have been through in the past 20 years just happening again. Small

companies will become big. Big companies cannot adjust to market changes quickly. New countries will

enter the market with products challenging China. Small nimble companies will see and seize this new

opportunity, and the cycle will repeat it self. (See Answer to Question 1-6 attachment for future issues

impacting brake rotor manufacturing in China and other countries.)” 

“It is my opinion that the effects of any potential revocation of the Anti Dumping Duty order, would

simply level the playing field for all of the Chinese Manufacturers to compete against one another for

their fair share of the US brake rotor market. The companies in the US with solid sourcing departments

would be able to work more easily with Chinese Manufacturers to grow their respective ranges of goods. 

Simply, the good Chinese manufacturers with good quality, range, delivery, and reasonable costs would

survive and lesser quality providers would go away.”

“In conclusion, I do not believe that the revocation of the order would cause our company to change its

current sources or vendor relationships. It may however open up new sourcing opportunities.”

***

“No major changes. There aren’t any U.S. manufacturers. They are all importing from China.”

***

“None.”

***

“Small corp., not much business. Bought rotor since 2007 in small quantity.”

***

“ Unknown.”
D-13

***

“There will not be an effect if the duty is removed. It is hoped there is enough product to meet demand.”

***

“No changes.”

***

“Supply car parts to installers as quickly as possible.”

***

“Don’t think there will be change.”

***

“No effect - will continue to buy from our current suppliers as there is no longer any U.S. production.”

***

“A reduction in price is expected in 2008 from our current supplier since they have moved their

production to China in 2007.”

***

“No change.”

Effects on U.S. market:

***

See response to “Effects on firm.”

***

“No major changes. There aren’t any U.S. manufacturers. They are all importing from China.”

***

“None.”

***

“N/A.”
D-14

***

“Unknown.”

***

“Capacity constraints are poised to be a problem. Elimination of the duty will ensure available product

for US market.”

***

“No effect.”

***

“None.”

***

“Don’t think there will be change.”

***

“No effect - will continue to buy from our current suppliers as there is no longer any U.S. production.”

***

“Expect the brake repair industry to more competitive from a pricing perspective. I would expect some of

the rotors imported to be inferior in quality but have a substantially lower cost which could confuse the

end customers. A customer might understand the difference in rotor costs between installers. Some

installers may elect to put on inferior quality rotors at a lesser price, where others will only put on the

highest quality.”

***

“No change.”
D-15

CHINESE PRODUCERS’ COMMENTS REGARDING THE SIGNIFICANCE OF THE

ANTIDUMPING DUTY ORDER AND THE LIKELY EFFECTS OF REVOCATION

The Commission asked Chinese producers if they anticipated any changes in the character of their

operations or organization relating to the production of aftermarket brake rotors in the future if

the subject antidumping duty order was to be revoked. (Question II-3.) The following are the

responses of the Chinese producers.

***

“No.”

***

“No.”

***

“No.”

***

“No.”

***

“No.”

***

“No.”

***

“No.”

***

“No.”

***

“No.”

***

“No.”
D-16

***

“No.”

***

“No.”

***

“No.”

The Commission requested Chinese producers to describe the significance of the existing subject 

antidumping duty order on aftermarket brake rotors in terms of its effect on their firm's

production capacity, production, home market shipments, exports to the United States and other

markets, and inventories, and to compare their firm's operations before and after the imposition of

the order. (Question II-14.) The following are quotations from the responses of Chinese producers.

***

“There is no significance. Now the percentage of US market is becoming lower and lower. We will

pay more attention to the other markets in the future.”

***

“Regardless of whether the dumping duty order exists or not, there are no significant effects on our

company.”

***

“There was no significant effect on our company.”

***

“There are no significant effects on our company’s operation.”

***

“There is no significant effect on our company.”

***

“The antidumping, order does not make significant effects on our company’s operations.”

***

“There are no significant effects on our company.”
D-17

***

“There is no significant effect on our company.”

***

“There are no significant effects on our company’s operation.”

***

“There are no significant effects on our company.”

***

“There is no significant effect on our company. The operation of our company is determined by our

customer orders and the supply of the raw materials.”

***

“That do not affect us.”

***

“There is no significant effect on our company.”

The Commission asked Chinese producers if they anticipated any changes in their production

capacity, production, home market shipments, exports to the United States and other markets, or

inventories relating to the production of aftermarket brake rotors in the future if the subject

antidumping duty order was to be revoked. (Question II-15.) The following are the responses of

the Chinese producers.

***

“No.”

***

“No.”

***

“No.”

***

“No.”

***

“No.”
D-18

***

“No.”

***

“No.”

***

“No.”

***

“No.”

***

“No.”

***

“No.”

***

“No.”

***

“No.”