PART IV: U.S. IMPORTS, APPARENT U.S. CONSUMPTION,
AND MARKET SHARES

U.S. IMPORTERS

The Commission sent importer questionnaires to 84 firms believed to be importers of hand trucks
and/or hand truck parts, as well as to all U.S. producers.' Usable questionnaire responses were received
from 36 companies that are believed to account for nearly three-quarters percent of the quantity of U.S.
imports from China during the period for which data were collected.” Thirty-five firms reported imports
of finished hand trucks. The largest importer of hand trucks from China is ***. Other major U.S.
importers of hand trucks in 2003 were ***. Seven U.S. importers reported imports of hand truck parts.
The largest importer of hand truck parts from China was ***,

U.S. IMPORTS OF HAND TRUCKS

US. imports of finished hand trucks are presented in table IV-1.> China is the largest foreign
supplier of hand trucks to the United States, accounting for 95.3 percent of total imports in 2003.4 The
quantity of imports of finished hand trucks from China increased by 107.1 percent from 2001 to 2003 and
was 0.4 percent higher in January-June 2004 than in January-June 2003. The value of imports of finished
hand trucks from China increased by 122.1 percent from 2001 to 2003 and was 29.4 percent higher in
January-June 2004 than in January-June 2003.

APPARENT U.S. CONSUMPTION OF HAND TRUCKS

Data on apparent U.S. consumption of hand trucks are presented in table IV-2. The quantity of
apparent U.S. consumption increased by 31.9 percent from 2001 to 2003 and was 1.0 percent higher in
January-June 2004 than in January-June 2003. The value of apparent U.S. consumption increased by
16.5 percent from 2001 to 2003 and was 3.2 percent higher in January-June 2004 than in January-June
2003.

' The Commission sent questionnaires to those firms identified in the petition, firms identified by the U.S.
Customs and Border Protection (“Customs”) as possible importers, and firms identified in the foreign producer
questionnaires.

? In addition, one company provided an incomplete questionnaire response with such data deficiencies that it
could not be incorporated in this report. The Commission also received 30 responses from firms indicating that they
did not import hand trucks.

* Imports of finished hand trucks are from official statistics under the HTS statistical reporting number for
industrial hand trucks, 8716.80.5010. Some finished hand trucks may be imported under HTS statistical reporting
number 8716.80.5090, which is a basket category. Staff believes that several responding firms may have imported
their hand trucks under the basket category, therefore, imports may be somewhat understated, primarily in late 2003
and early 2004. One company - *** - specifically reported that it imported a *** under HTS statistical reporting
number 8716.80.5090. It imported *** units (***) in the second half of 2003 and *** units (***) in the first half of
2004,

* Taiwan and Thailand were the next largest exporters of hand trucks to the United States in 2001-03. However,
in January-June 2004 imports of finished hand trucks from Indonesia increased substantially. These imports had a
very low unit value.

Iv-1


3. Inventories of the subject merchandise”

We find that inventories of subject imports held by importers in the United States support a
conclusion that the domestic industry is threatened with material injury by reason of subject imports.
End-of-period inventories of subject imports held by importers increased by 85.1 percent from 2001 to
2003, and were 181.5 percent higher in interim 2004 as compared to interim 2003. Importer end-of-
period inventories were 120,735 hand trucks in 2001 and 115,821 hand trucks in 2002, before increasing
to 223,477 hand trucks in 2003. In interim 2004, they were 418,740 hand trucks as compared to 148,779
hand trucks in interim 2003. The highest level of inventories in the period examined was in interim
2004.'* Although these inventories are included in our market penetration data, their effect on the
domestic industry will not be felt fully until they are sold into the market by the importers.

4. Prices of subject imports”

We have examined data on prices of hand trucks and have considered whether subject import
prices are likely to increase demand for further imports, or are likely to have significant price suppressing
or depressing effects.

As stated earlier, sales of hand trucks in the U.S. market are driven to a large extent by price
competition. There is a moderate to high level of interchangeability between domestic product and
subject imports. Price competition is particularly intense in the home improvement sector of the market.
Prices in this sector tend to be lower than in the catalog/industrial distributor sector which sells more
specialized and generally more expensive hand trucks in smaller volumes.'*? Volume discounts are
common in this industry. In the face of intense price competition, which is concentrated in the home
improvement sector of this industry, a domestic producer is more likely to produce and sell fewer hand
trucks than to reduce its prices and sell them at a loss, due to the relatively high level of variable costs in
this industry.

The Commission collected pricing data on four products, gathered separately for the home
improvement, hardware and catalog/industrial distributor channels of distribution. Products | and 2 are
general use hand trucks. Product 3 is a specialized appliance hand truck. Product 4 is an aluminum hand
truck. Eight producers provided pricing data that accounted for approximately 54 percent of U.S.
producers’ shipments of hand trucks in 2003. Twenty-three importers provided pricing data that
accounted for about 34 percent of total imports of hand trucks from China in that year.'*!

Underselling by subject imports of the domestic product has been widespread. Of the 122
possible quarterly price comparisons from January 2001 to June 2004, subject imports undersold
domestic products in 114 quarters or in 93 percent of the possible comparisons.'*” Underselling margins
ranged as high as 80 percent.

Purchaser data and confirmed lost sales and revenue allegations corroborate the widespread
underselling reflected in the pricing data. A substantial majority of responding purchasers confirmed that

4719 U.S.C. § 1677(7)(F\G(V).
48 CR/PR at Table VII-4, Table C-1.
4 19 U.S.C. § 1677(7)(F (IV).

59 CR at V-5; PR at V-3.

151 OR at V-4; PR at V-3.

8 CR at V-22; PR at V-7.

21


U.S. International Trade Commission

COMMISSIONERS

Stephen Koplan, Chairman
Deanna Tanner Okun, Vice Chairman
Marcia E. Miller
Jennifer A. Hillman
Charlotte R. Lane
Daniel R. Pearson

Robert A. Rogowsky
Director of Operations

Staff assigned

Elizabeth Haines, Investigator
Peder Andersen, Industry Analyst
Clark Workman, Economist
David Boyland, Accountant
Karen Veninga Driscoll, Attorney
Steven Hudgens, Statistician
Douglas Corkran, Supervisory Investigator

Address all communications to
Secretary to the Commission
United States International Trade Commission
Washington, DC 20436


The Commission requested U.S. firms to describe any actual or anticipated negative effects,
since January 1, 2001, of imports of hand trucks and certain parts thereof from China on their growth,
investment, and ability to raise capital or development and production efforts (including efforts to
develop a derivative or more advanced version of the product). Responses are shown below.

Actual Negative Effects
American He,
Angelus ae
Anthony bilan
B&P ae,
Fairbanks ee,
Gleason te)
Harper Trucks ***.
Magline ee
Wesco aes,

Valley Craft ***.

Anticipated Negative Effects

American an
Angelus an
Anthony cian
B&P ee,
Fairbanks ae,
Gleason 4eeT
Harper Trucks ***.
Magline #e
Wesco ae,

Valley Craft ***.

Va

F-3


Quarterly price data and shipment quantities by individual producers by product category in each
of the market segments are presented in appendix E. As shown in tables E-1 through E-4, some
producers that do not sell hand trucks through the home improvement or hardware channels are important
suppliers in the catalog house/industrial supply distributor channel.

The data in the tables and charts show that price trends are varied. In the case of U.S. producers,
most products did not exhibit a clear trend during the 14-quarter period. However, producer prices of
products 1 and 2 sold to hardware stores and product 2 sold to home improvement stores declined
slightly over the period. In the case of imports from China, prices of some products were relatively
stable while prices for other products varied widely.

Table V-1

Hand trucks: Weighted-average f.o.b. prices and quantities of domestic and imported product 1
sold to home improvement stores, margins of underselling/(overselling), and the quantity and
landed duty-paid value per unit of imports by ***, by quarters, January 2001-June 2004

* * * * * * *

Table V-2

Hand trucks: Weighted-average f.0.b. prices and quantities of domestic and imported product 1
sold to hardware stores and margins of underselling/(overselling), by quarters, January 2001-June
2004

Table V-3

Hand trucks: Weighted-average f.0.b. prices and quantities of domestic and imported product 1
sold to catalog houses/industrial supply distributors, margins of underselling/(overselling), and the
quantity and landed duty-paid value per unit of imports by firms that sell through catalogs, by
quarters, January 2001-June 2004

* * * * * * *

Table V-4

Hand trucks: Weighted-average f.o.b. prices and quantities of domestic and imported product 2
sold to home improvement stores, margins of underselling/(overselling), and the quantity and
landed duty-paid value per unit of imports by ***, by quarters, January 2001-June 2004

* * * * * * *

Table V-5

Hand trucks: Weighted-average f.o.b. prices and quantities of domestic and imported product 2
sold to hardware stores and margins of underselling/(overselling), by quarters, January 2001-June
2004

v4


OPERATIONS ON CERTAIN HAND TRUCK PARTS

Table VI-4 presents the results of operations on certain hand truck parts. As presented in this
section of the report, operations on certain hand truck parts reflect a single company: Magline.

Magline assembles frames and handling areas from ***.!? **#,'5

Similar to the trend observed for finished hand trucks, annual revenue on hand truck parts was
highest in 2001. Despite lower sales quantity and revenue in all parts categories, operating profit peaked
in 2002 due to higher average unit revenue in three out of the four parts categories and a percentage
decline in total COGS which exceeded the percentage decline in revenue. A reversal of this trend in the
following year (i.e., declines in both average unit revenue and quantity in most of the parts categories and
a decline in COGS which was proportionately smaller than the decline in revenue) resulted in lower
operating income in 2003.

At the end of the period and despite *** decline in the average unit revenue of unassembled hand
trucks, revenue in interim 2004 was higher compared to interim 2003 due to a *** increase in the sales
quantity of unassembled hand trucks. Despite the increase in revenue, the more than proportionate
increase in total COGS, as compared to the increase in revenue, resulted in lower interim 2004 operating
income compared to interim 2003.'*

Table VI-4
Certain hand truck parts: Results of operations of Magline, 2001-03, January-June 2003, and
January-June 2004

COMBINED OPERATIONS ON HAND TRUCKS AND CERTAIN HAND TRUCK PARTS

Table VI-5 presents the combined financial operations on finished hand trucks and certain hand
truck parts.

Table VI-5
Hand trucks and certain hand truck parts: Consolidated results of operations of U.S. producers,
fiscal years ended 2001-03, January-June 2003, and January-June 2004

* * * * * * *

12 +** telephone interview by USITC staff, August 30, 2004.
13 #** telephone interview by USITC staff, September 2, 2004.

14 eee

VI-5


2001 to 2003, and continued to grow in interim 2004, with significant gains in all channels of
distribution.*

Demand for finished hand trucks is fueled predominantly by the home improvement sector of the
U.S. market, which encompasses home improvement stores and club warehouses, both of which are large
scale retailers, (sometimes referred to as “big-box” retailers).>> Home improvement stores (like Home
Depot and Lowe’s), and club warehouses (like Costco or Sam’s), are generally national stores that
purchase hand trucks in large volumes from a single or limited number of suppliers.** They generally
buy a few models of general-use hand trucks in high volumes, due to limited shelf-space.*” Due to the
large volume of their purchases, home improvement stores can successfully negotiate low purchase
prices for hand trucks.** Volume discounts are common,” and sales volume is critical to the hand truck
industry. Therefore, a domestic producers’ loss of a home improvement account that accounts for a
significant percentage of their annual sales can have a significant negative impact on its sales volume,
and consequent profitability, revenue, shipments, capital expenditures and employment related to its hand
truck operations. Most of the competition between domestic hand trucks and subject imports takes place
in the home improvement sector of the U.S. hand truck market.*!

Although Gleason and Respondent LDI view the market for hand trucks differently,” they both
recognize the dominance of the home improvement sector of the market, the intense price competition
within that sector, and the differences between that sector and the more specialized catalog/industrial
sector of the market. Gleason maintains that big-box retailers account for approximately *** percent of
annual sales of hand trucks.“ It emphasizes the importance of price in purchasing hand trucks,
particularly with respect to big box retailers like Home Depot and Lowe’s.* LDI states that residential
customers buy the lowest-priced hand trucks in home improvement stores.

*#** is the largest single purchaser of hand trucks. *** alone purchased or imported directly ***
units in 2003, equivalent to *** percent of apparent U.S. consumption in that year.’ Other major known
purchasers, several of which are big box retailers, include ***, as well as ***.

The industrial sector of the U.S. hand truck market is a distant second to the home improvement
sector in terms of demand for hand trucks. Industrial customers buy more specialized and expensive

* CR/PR at Table IV-2 and Table I-1.

55 CR at I-13, n.32; PR at I-7, n.32. Our channel of distribution data provides separate data for the home
improvement store channel of distribution and the club warehouse channel of distribution, but both channels serve
primarily residential customers. CR/PR at Table I-1.

% Gleason Prehearing Brief at 11-12.

57 CR at 1-9; PR at 1-6. Gleason Prehearing Brief at 11-13.

°8 CR at 1-9; PR at I-6.

* CR/PR at V-2.

© Gleason Prehearing Brief, Appendix A, at 3 ***,

‘| LDI Prehearing Brief at 2.

@ CR at I-8-I-9; PR at 1-6. Gleason Final Comments at 3. LDI Posthearing Brief at 1-2.

© Gleason Final Comments at 3. CR at I-9; PR at I-6; Commission Hearing Transcript, October 7, 2004 (“Tr.”)
at 64-65 (David Rife, Vice President, Sales, Harper Trucks, Inc.; Howard Simon, Chief Operating Officer, Gleason
Industrial Products, Inc.) and 72-76 (David Straw, President, Magline; Simon).

“ Gleason Prehearing Brief at 13.

© Gleason Prehearing Brief at 7-9.

© LDI Prehearing Brief at 2.

®7 CR at I-3; PR at I-3.

®§ CR at I-3; PR at 1-3.

11




is dispositive and all relevant factors are considered “within the context of the business cycle and
conditions of competition that are distinctive to the affected industry.”'9! '?

We conclude that subject imports have had some negative impact on the domestic industry, but
that the impact has not yet risen to the level of material injury. The lost accounts, sales, and revenues
that have occurred due to subject imports have diminished the profitability of the domestic industry, but
its operating income remains relatively healthy.’ The decline in profitability renders the industry
vulnerable to the effects of increased subject imports in the imminent future. Similarly, domestic
production and capacity utilization with respect to production of finished hand trucks, and sales and
shipments of hand trucks and parts were stable over the annual periods examined, but then at lower levels
in interim 2004 as compared to interim 2003, with negative implications for the imminent future. The
Commission has considered the other indicia specified by the statute, including capital investment and
employment indicators, and nothing in this information is contrary to the Commission’s finding.

We further determine, pursuant to 19 U.S.C. § 1673d (b) (4) (B), that we would not have made a
material injury determination but for Commerce’s suspension of liquidation of subject imports in May
2004. Our record contains data from January to June 2004, and we do not have sufficient data on the
record to determine whether the suspension of liquidation prevented the domestic industry from
experiencing material injury between the end of May 2004 and our vote.'*

CONCLUSION
For the foregoing reasons, we determine that the domestic industry producing hand trucks and

parts thereof is threatened with material injury by reason of subject imports from China sold at less than
fair value.

'1 19 U.S.C. § 1677(7)(C)(iii).. See also SAA at 851, 885; Live Cattle from Canada and Mexico, Inv. Nos. 701-
TA-386 and 731-TA-812-813 (Preliminary), USITC Pub. 3155 (February 1999) at 25, n.148.

'2 The statute instructs the Commission to consider the “magnitude of the dumping margin” in an antidumping
proceeding as part of its consideration of the impact of imports. 19 U.S.C. § 1677(7)(C)(iii)(V). Commerce issued
final dumping margins for six named Chinese producer/exporters ranging from 24.90 to 386.75 percent. Commerce
found dumping margins of 24.90 percent for True Potential, 27.00 percent for Taifa, 30.56 percent for Future Tool,
30.56 percent for Shandong, 45.04 percent for Huatian, 386.75 percent for Xinghua and 386.75 percent for all
others. 69 Fed Reg. 60980, 60984 (October 14, 2004).

‘3 The domestic industry’s return on investment (the ratio of operating income to total assets) was also positive
and stable from 2001 to 2002 before declining significantly in 2003. CR/PR at Table VI-7.

194 Moreover, we note that *** prior to the suspension of liquidation, and that *** due to the suspension of
liquidation. ***. Gleason Prehearing Brief at 27. ***.

28


In Opposition to the Imposition of
Antidumping Duties (continued):

Greenberg Traurig, LLP
Washington, D.C.
on behalf of

China Chamber of Commerce for Import & Export of
Machinery & Electronics

Qingdao Huatian Hand Truck Co., Ltd.

Qingdao Taifa Group Co., Ltd.

Qingdao Zhenhua Industrial Group Co., Ltd.

Qingdao Xinghua Group Co., Ltd.

Shandong Machinery Import & Export Group Corporation

Jiaonan Tianhe Hand Truck Co., Ltd.

Feng Xuelou, Chairman, Qingdao Taifa Group Co., Ltd.

Ge Zhiqiang, Vice General Manager, Qingdao Taifa Group
Import & Export Corp.

Liu Huijuan, Project Director, China Chamber of Commerce
for Import & Export of Machinery & Electronics

Wei-Mo Liu, Assistant Director, Greenberg Traurig, LLP

Philippe M. Bruno )
) - OF COUNSEL
Rosa Jeong )

REBUTTAL/CLOSING REMARKS

Petitioners (Matthew P. Jaffe, Crowell & Moring, LLP)
Respondents (Rosa Jeong, Greenberg Traurig, LLP; and
Mark S. Zolno, Katten, Muchin, Zavis, Rosenman)

B-5


Tables I-1, I-2, and I-3 present questionnaire data on the most common groupings of customers
identified in the petition or by the respondents at the hearing. Based on the channel structure identified
by petitioners, *** percent of U.S. shipments of finished hand trucks by the domestic industry in 2003
were to home improvement customers; 11.6 percent were to catalog houses/industrial suppliers; ***
percent were to hardware customers; and *** percent were to other customers.” Shipments of
components and unassembled hand trucks (kits) were exclusively to catalog houses/industrial suppliers.
By comparison, *** percent of U.S. shipments of finished hand trucks imported from China in 2003 were
to home improvement customers; 14.3 percent were to catalog houses/industrial suppliers; 3.1 percent
were to hardware customers; and *** percent were to other customers. Shipments of components were
to catalog houses/industrial suppliers (*** percent) and to other customers (*** percent), while
shipments of kits were to other customers.”

Based on the channel structure identified by respondents, 86.6 percent of U.S. shipments of
finished hand trucks by the domestic industry in 2003 were to residential customers; 11.6 percent were to
industrial customers; *** percent were to office/small business customers; and *** percent were to other
customers.** Shipments of components and unassembled hand trucks (kits) were exclusively to industrial
customers.*> By comparison, 42.8 percent of U.S. shipments of finished hand trucks imported from
China in 2003 were to residential customers; 14.3 percent were to industrial customers; *** percent were
to office/small business customers; and *** percent were to other customers.** Shipments of components
were to industrial customers (*** percent) and to other customers (*** percent), while shipments of kits
were to office supply stores.

* Home improvement customers include both so-called “big box” stores and club warehouses and other large-
scale retail stores, while office supply stores are considered “other customers.” See hearing transcript, p. 130
(Kvasnicka — “Well, we see that (office supply stores) as really just another channel of distribution, certainly one that
we've got a close eye and one we would like to penetrate, but at this point we haven't been able to get very far just
because of pricing issues.”)

3 The majority of the “other customers” for components from China were U.S. hand truck producers, while office
supply stores were the “other customers” for kits from China. For finished hand trucks, “other customers” were
primarily individual consumers attracted by direct response campaigns on behalf of ***. This approach differs from
that employed by petitioner Gleason. Hearing transcript, p. 135 (Kvasnicka — “We do not do direct sales over the
internet because in that case we would be competing with our customers directly, allowing consumers to buy from
us.”)

* Residential customers are retail outlets for the homeowner, including big box home improvement stores,
national hardware cooperatives, and wholesale club stores. Liberty Diversified posthearing brief, pp. 1-2.

+> Respondents note that the residential, industrial, and office/small business channels all employ catalogs.
Liberty Diversified posthearing brief, p. 2. Most questionnaire respondents that reported sales as catalog
houses/industrial supply distributers viewed themselves as industrial suppliers.

*° As noted above, most of the “other customer” shipments were to individual consumers believed to correspond
most closely to residential customers.

1-7


Table IV-6
Hand truck parts: U.S. producers’ U.S. shipments, U.S. imports, by sources, and apparent U.S.
consumption, 2001-03, January-June 2003, and January-June 2004

* * * * * * *

Table IV-7
Hand truck parts: Apparent U.S. consumption and market shares, 2001-03, January-June 2003,
and January-June 2004

Table IV-8
Hand truck parts: Ratio of U.S. imports to U.S. production, by sources, 2001-03, January-June
2003, and January-June 2004

* * * * * * *
Table IV-9

Hand trucks and parts: U.S. producers’ U.S. shipments, U.S. imports, by sources, and apparent
U.S. consumption, 2001-03, January-June 2003, and January-June 2004

* * * * * * *
Table IV-10

Hand trucks and parts: Apparent U.S. consumption and market shares, 2001-03, January-June
2003, and January-June 2004

* * * * * * *


importer of hand truck parts from China is ***.? *** is the largest single purchaser of hand trucks. ***
alone purchased or imported directly *** units in 2003, equivalent to *** percent of apparent U.S.
consumption in that year. Other major known purchasers include ***.

THE PRODUCT
Commerce has defined the scope of this investigation as follows:

The product covers hand trucks manufactured from any material, whether assembled or
unassembled, complete or incomplete, suitable for any use, and certain parts thereof, namely the
vertical frame, the handling area and the projecting edges or toe plate, and any combination
thereof.

A complete or fully assembled hand truck is a hand-propelled barrow consisting of a
vertically disposed frame having a handle or more than one handle at or near the upper section of
the vertical frame; at least two wheels at or near the lower section of the vertical frame; and a
horizontal projecting edge or edges, or toe plate, perpendicular or angled to the vertical frame, at
or near the lower section of the vertical frame. The projecting edge or edges, or toe plate, slides
under a load for purposes of lifting and/or moving the load.

That the vertical frame can be converted from a vertical setting to a horizontal setting,
then operated in that horizontal setting as a platform, is not a basis for exclusion of the hand
truck from the scope of this petition. That the vertical frame, handling area, wheels, projecting
edges or other parts of the hand truck can be collapsed or folded is not a basis for exclusion of
the hand truck from the scope of this petition. That other wheels may be connected to the
vertical frame, handling area, projecting edges, or other parts of the hand truck, in addition to the
two or more wheels located at or near the lower section of the vertical frame, is not a basis for
exclusion of the hand truck from the scope of the petition. Finally, that the hand truck may
exhibit physical characteristics in addition to the vertical frame, the handling area, the projecting
edges or toe plate, and the two wheels at or near the lower section of the vertical frame, is not a
basis for exclusion of the hand truck from the scope of the petition.

Examples of names commonly used to reference hand trucks are hand truck, convertible
hand truck, appliance hand truck, cylinder hand truck, bag truck, dolly, or hand trolley. They are
typically imported under heading 8716.80.5010 of the Harmonized Tariff Schedule of the United
States (“HTSUS”), although they may also be imported under heading 8716.80.5090. Specific
parts of a hand truck, namely the vertical frame, the handling area and the projecting edges or toe
plate, or any combination thereof, are typically imported under heading 8716.90.5060 of the
HTSUS. Although the HTSUS subheadings are provided for convenience and customs purposes,
the Department’s written description of the scope is dispositive.

Excluded from the scope are small two-wheel or four-wheel utility carts specifically
designed for carrying loads like personal bags or luggage in which the frame is made from
telescoping tubular material measuring less then 5/8 inch in diameter; hand trucks that use
motorized operations either to move the hand truck from one location to the next or to assist in
the lifting of items placed on the hand truck; vertical carriers designed specifically to transport
golf bags; and wheels and tires used in the manufacture of hand trucks.'°

9 ex

'° 69 F.R. 60980, October 14, 2004.

1-3


Product .—Steel single loop handle truck with a load rating of 400-800 pounds, P-shaped or
D-shaped handle, overall vertical height of 50 to 52 inches, and a toe plate which is 8-9 %
inches by 14 inches;

Product 2.-Steel convertible truck with a load rating of 300-800 pounds, flow back handle
style, overall vertical height of 33 to 52 inches, and a toe plate which is 6 % -9 inches by 14
inches;

Product 3.Steel appliance truck with a load rating of 700 pounds, overall vertical height of
60 inches, a toe plate which is 4 4 inches by 24 inches, and a manual belt tightener; and

Product 4.-Aluminum convertible truck with a load rating of 500-1200 pounds, continuous
loop and/or dual handle, overall vertical height of 50 to 62 inches, and a toe plate which is
7% -10 inches by 14-18 inches

Eight U.S. producers and 23 importers provided varying amounts of quarterly price data on the
requested products. Price data from producers accounted for approximately 54 percent of U.S.
producers’ shipments of hand trucks in 2003. Price data from 23 importers of hand trucks from China
accounted for about 34 percent of total imports of hand trucks from China in that year.

Price Trends

Quarterly weighted-average domestic prices and prices of imports from China are presented in
tables V-1 through V-11 and in figures V-1 through V-11 on sales of all four products in the different
channels of distribution for the period January 2001 through June 2004. In addition, for products 1, 2,
and 3, landed duty-paid values per unit and quantities of imports reported by ***.° No price data are
presented on sales of product 4 to home improvement stores since no import prices were reported for this
product in this channel of distribution. Likewise for products 1, 2, 3, and 4 average landed duty-paid
values by importers that sell principally through catalogs are shown in tables V-3, V-6, V-9, and V-11.”
Quarterly weighted-average landed duty-paid values per unit of the four products and import quantities of
these products reported by importers that sell to retail customers and other end-use customers are shown
in appendix D. The *** and catalog firm data are included.

The data in the tables show that average U.S. producer prices on sales of hand trucks to home
improvement stores and hardware stores are lower for each of the product categories than on sales to
catalog houses/industrial supply distributors. This occurs because customers that purchase hand trucks
from catalog houses and industrial distributors tend to be industrial firms, distribution companies, and
moving companies whereas sales through the other channels are made mostly to do-it-yourself (“DIY”)
customers. Industrial customers generally require more complex hand trucks than do DIY customers. In
addition, in the case of home improvement stores, purchases volumes are much larger than for catalog
houses/industrial distributors, tending to lower the average price on sales to such customers.*

® While these data are not at the same level of trade as U.S. producer prices on sales to home improvement stores,
they do offer an indicator of the extent of price differences between U.S.-produced hand trucks and subject imports.

7 The data for products 2 and 3 are entirely from ***.

* Gleason posthearing brief, exh.1, pp. 4-5. For U.S. importers, however, product differences may be less
pronounced. See, ¢.g., hearing transcript, p. 187 (LaFontaine, no significant differences in products sold through
residential and industrial channels).

V-3




(including kits) as measured by apparent U.S. consumption increased from *** units in 2001 to *** units
in 2003. During January-June 2004, apparent U.S. consumption was *** units as compared to *** in the
same period in 2003.

Producers and importers were asked whether demand for hand trucks had increased, decreased,
or remained the same since January 1, 2001, and were also asked what factors affect changes in demand.
Among the 10 producers that responded to the question, four said that demand had increased, one said
that demand had remained the same, and five stated that it had decreased. Among producers reporting an
increase in overall demand, one firm, ***, said that it has been due to changes in the economy that have
resulted in frequent relocations by individuals and businesses. Another firm, Harper Trucks, said that it
has been due to the increased availability of hand trucks to consumers as the result of the growth of major
tetailers.° Three of the firms reporting a decrease in demand attributed the decline to the weak U.S.
economy. Among the 29 importers that responded to this question, nine said that demand had increased,
five said that it had decreased, and 15 said that it was unchanged. Two of the importers reporting
increases in demand cited increases in demand in the primary markets where they sell rather than in the
overall market for hand trucks. One firm experiencing an increase in demand said that it sells exclusively
to the self-storage industry, and the other cited increasing demand on the part of homeowners and do-it-
yourself customers. Another importer that sells only aluminum hand trucks attributed the growth in
demand to ergonomic/safety concerns of end use customers.

At the conference and in its postconference brief, U.S. importer Central Purchasing asserted that
imports from China have created a new market demand among homeowners willing to purchase hand
trucks at low prices; it also contended that if not for the low prices, these customers would not have
otherwise purchased hand trucks at all.’ In response to this issue and related questions raised during the
preliminary phase of the investigation,* purchasers were asked to discuss the differences, if any, in the
physical characteristics, conditions of sale, and price levels of U.S.-produced and Chinese-produced
finished hand trucks and/or hand truck parts sold in the United States. They were also asked to note the
impact, if any, of such differences on demand for finished hand trucks and/or hand truck parts in the
United States. Of the 12 firms that compared the U.S.-produced and Chinese-produced products, three
firms reported that the products were comparable or that there were no differences between the products.
Another said that there are negligible differences between the products. Two other firms reported that
both products met requirements, but that the Chinese-produced product is less expensive. One firm
reported that the Chinese product has good quality and a low price. Two firms stated that the Chinese
imports are less expensive, but the quality is inferior. Another firm said that imports from China are
either too brittle or too soft and tend to bend. Another purchaser said that imports from China require
more frequent quality checks than U.S.- produced hand trucks. One firm said that imports from China
were a good value as compared to imports from other countries. None of the purchasers reported that
differences between U.S.-produced and Chinese-produced hand trucks had any impact on demand for
hand trucks in the United States and none of the purchasers reported that there is a separate “lower-
priced” consumer market for hand trucks from China.

When purchasers were asked whether the filing of the antidumping petition, the Commission’s
affirmative preliminary determination in January 2004, or the Department of Commerce’s preliminary
dumping determination in May 2004 caused them to cancel orders and/or reduce purchases of imports of

° At the hearing, Mr. David Rife, the vice president of sales at Harper Trucks, testified that demand for hand
trucks had increased because of the increased availability of hand trucks at large retailers such as Home Depot,
Lowe’s, Sam’s Club, and Costco (Hearing Transcript, p. 136 (Rife)).

7 Conference transcript, p. 89 and Central Purchasing postconference brief, p. 6.

® See “Views of the Commission “ in Hand Trucks and Parts Thereof from China, Investigation No. 731-TA-1059
(Preliminary), Publication No. 3660, January 2004, p. 10 n. 56 and p. 14 n. 88 (Commissioner Pearson).

1-3


APPENDIX A

FEDERAL REGISTER NOTICES

A-l


stores; catalog houses/industrial distributors; and to office supply stores, as well as directly to end users.°

Also present in the market were modest levels of imports from nonsubject sources.®
Il. DOMESTIC LIKE PRODUCT AND INDUSTRY
A. In General

In determining whether an industry in the United States is materially injured or threatened with
material injury by reason of imports of the subject merchandise, the Commission first defines the
“domestic like product” and the “industry.”” Section 771(4)(A) of the Tariff Act of 1930, as amended
(“the Act”), defines the relevant domestic industry as the “producers as a [w]hole of a domestic like
product, or those producers whose collective output of a domestic like product constitutes a major
proportion of the total domestic production of the product.” In turn, the Act defines “domestic like
product” as “a product which is like, or in the absence of like, most similar in characteristics and uses
with, the article subject to an investigation... .””

The decision regarding the appropriate domestic like product(s) in an investigation is a factual
determination, and the Commission has applied the statutory standard of “like” or “most similar in
characteristics and uses” on a case-by-case basis.'° No single factor is dispositive, and the Commission
may consider other factors it deems relevant based on the facts of a particular investigation.'' The
Commission looks for clear dividing lines among possible like products and disregards minor
variations.’ Although the Commission must accept the determination of the Department of Commerce
(“Commerce”) as to the scope of the imported merchandise that has been found to be subsidized or sold
at LTFV, the Commission determines what domestic product is like the imported articles Commerce has
identified."

> CR/PR at Table I-1.

° CR/PR at Table IV-1.

719 U.S.C. § 1677(4)(A).

519U, § 1677(4)(A).

° 19 U.S.C. § 1677(10).

'® See, e.g., NEC Corp. v. Department of Commerce, 36 F. Supp.2d 380, 383 (Ct. Int’l Trade 1998); Nippon
Steel Corp. v. United States, 19 CIT 450, 455 (1995); Torrington Co. v. United States, 747 F. Supp. 744, 749 n.3
(Ct. Int’l Trade 1990), aff'd, 938 F.2d 1278 (Fed. Cir. 1991) (“every like product determination ‘must be made on
the particular record at issue’ and the ‘unique facts of each case’ ”). The Commission generally considers a number
of factors including: (1) physical characteristics and uses; (2) interchangeability; (3) channels of distribution; (4)
customer and producer perceptions of the products; (5) common manufacturing facilities, production processes and
production employees; and, where appropriate, (6) price. See Nippon Steel, 19 CIT at 455 n.4; Timken Co. v.
United States, 913 F. Supp. 580, 584 (Ct. Int’l Trade 1996).

" See, e.g., S. Rep. No. 96-249 at 90-91 (1979).

" Nippon Steel, 19 CIT at 455; Torrington, 747 F. Supp. at 748-749; see also S. Rep. No. 96-249 at 90-91
(1979) (Congress has indicated that the like product standard should not be interpreted in “such a narrow fashion as
to permit minor differences in physical characteristics or uses to lead to the conclusion that the product and article
are not ‘like’ each other, nor should the definition of ‘like product’ be interpreted in such a fashion as to prevent
consideration of an industry adversely affected by the imports under consideration.”).

"3 Hosiden Corp. v. Advanced Display Mfrs., 85 F.3d 1561, 1568 (Fed. Cir. 1996) (Commission may find single
like product corresponding to several different classes or kinds defined by Commerce); Torrington, 747 F. Supp. at
748-752 (affirming Commission determination of six like products in investigations where Commerce found five

(continued...)



CONTENTS

Determination ©... 6... ccc nee renee een e enn een ene
Views of the Commission
Part I: Introduction ... :
Background ... 0.2... eee cnn eet need een nett een nena
Organization of the report...... 2.06. c ccc ee nent e eee enna
Summary data
Previous and related investigations ......... 0... e cece cence eee teen eee

Major firms involved in the U.S. hand truck market .......0. 0.00. e cece eset e eee e eee

The product : :
The domestic like product ..... 0.20... 0 ccc e cece cee e eee eet terete nee eee
Physical characteristics and uses... 2.2.2... cece cece eee ee nee e nee ee
Manufacturing processes, facilities, and employees .. .
Interchangeability and customer and producer perceptions .
Channels of distribution ................0..0.005

Part II: Conditions of competition in the U.S. market .
U.S. market segments/channels of distribution .
Supply and demand considerations ......

U.S. supply ..........4.-

Subject imports ..
Demand characteristics . .
Substitute products 2.2.2... 0.6. o eect eee e ence eens

Substitutability issues .
Factors affecting purchasing decisions . . .
Comparisons of domestic products and subject imports .
Comparisons of domestic products and nonsubject imports cee eee eens
Comparisons of subject imports and nonsubject imports .

Elasticity estimates ©2020... 0. cece eee n nnn nen erent eeeneee
USS. supply elasticity
U.S. demand elasticity .
Substitution elasticity ....

Part III: U.S. producers’ production, shipments, and employment................0--+00eeee
US. producers .... 6.6.6 i cece neces
U.S. capacity, production, and capacity utilization of hand trucks .
USS. producers’ U.S. shipments and export shipments of hand trucks .
U.S. producers’ imports and purchases of imports of hand trucks . .
U.S. producers’ inventories of hand trucks ..
U.S. employment, wages, and productivity of hand trucks :
USS. capacity, production, and capacity utilization of parts .... 2.0.0.2... 0c eee eee eee
U.S. producers’ U.S. shipments and export shipments of parts ............. 0000 e cess eee
U.S. producers’ imports and purchases of imports of parts . . .
USS. producers’ inventories of parts ...... 2.6.6.6. cece eee eee eee eee
U.S. employment, wages, and productivity of parts ......... 0.0000 c eee eee ence eee eee
U.S. producers’ U.S. shipments and export shipments of hand trucks and parts .............

1-3




4410

In the preliminary phase of the investigation, *** stated that sales of ***.

ee I 2 lial

In the final phase of the investigation, the staff contacted *** to discuss the current status of
domestic purchases and imports. *** reported that it had been phasing out purchases of hand trucks from
***_ However, as a result of the large dumping margins that went into effect following Commerce’s
preliminary determination in May 2004, it ***. ***. Since that time it has ***.’> However, instead of
buying *** it now ***.'* The company subsequently indicated that if the dumping margins were

removed, ***,'5
ee

However, ***. It reported that ***.'° When asked in its purchaser questionnaire whether the
filing of the antidumping petition, the Commission’s affirmative preliminary determination in January
2004, or Commerce’s preliminary determination in May 2004 caused it to cancel orders and/or reduce

purchase quantities of hand trucks and parts from China, ***. '”
RE

eK .

RK . 18

Gleason alleged that it lost revenue on a sale of ***.

Gleason alleged that it has lost business from ***.!°

In the final phase of the investigation the staff contacted *** again to obtain additional

information concerning the allegation, and to examine the current status of imports. ***
eK 20

10 «4s purchaser questionnaire shows that the average unit values of purchases of Chinese imports were always
far lower than the average unit values of purchase of the U.S.-produced hand trucks during 2001-03. During 2003,
the year cited in the allegation, the U.S. average unit value was more than $*** per unit, while the average unit value
of imports from China was less than $***.

' Telephone interview by USITC Staff with ***, December 4, 2003 and December 22, 2003.
1k

13 aoe

' Hearing transcript, p. 24 (Jaffe). According to ***.
15 ee

' Telephone interview by USITC Staff with ***, August 27, 2004. ***,

"7 Additional information was provided in an e-mail response by ***.
18 eee
19 see

20 sake

v-9




Hand Trucks and Certain Parts
Thereof From China

Investigation No. 731-TA-1059 (Final)

Publication 3737 November 2004

U.S. International Trade Commission

Washington, DC 20436


Table C-2
Hand truck parts (including kits): Summary data concerning the U.S. market, 2001-03, January-
June 2003, and January-June 2004

* * * * * * *
Table C-3
Finished hand trucks and parts (including kits): Summary data concerning the U.S. market, 2001-
03, January-June 2003, and January-June 2004

* * * * * * *

C-4




APPENDIX D

WEIGHTED-AVERAGE LANDED DUTY-PAID VALUES PER UNIT FOR
PRODUCTS 1, 2, 3, AND 4, AND QUANTITIES OF IMPORTS BY IMPORTERS
THAT SELL DIRECTLY TO RETAIL CUSTOMERS AND OTHER END-USE

CUSTOMERS

D-1


production, shipments, sales, and capacity utilization. These losses, in tum, will force the domestic
industry to significantly cut back on its employment. The financial condition of the domestic industry,
which is already vulnerable, will quickly deteriorate until the industry is materially injured by reason of
subject imports. Subject import volume will increase significantly, and the domestic industry will
experience significant price suppressing effects as fewer sales are spread over its fixed costs. The
domestic industry will lose additional market share. The domestic industry’s sales volume, which is
critical to this industry, will be severely diminished, and its profitability will fall in tandem with its sales.
Accordingly, we determine that, absent issuance of an antidumping order, further subject imports are
imminent and material injury by reason of subject imports will occur.

Vv. NO MATERIAL INJURY BY REASON OF SUBJECT IMPORTS FROM CHINA

In the final phase of antidumping duty and countervailing duty investigations, the Commission
determines whether an industry in the United States is materially injured by reason of the imports under
investigation.'*®° In making this determination, the Commission must consider the volume of imports,
their effect on prices for the domestic like product, and their impact on domestic producers of the
domestic like product, but only in the context of U.S. production operations.'*' The statute defines
“material injury” as “harm which is not inconsequential, immaterial, or unimportant.”'* In assessing
whether the domestic industry is materially injured by reason of subject imports, we consider all relevant
economic factors that bear on the state of the industry in the United States.’ No single factor is
dispositive, and all relevant factors are considered “within the context of the business cycle and
conditions of competition that are distinctive to the affected industry.”'**

The data relevant to our determination of material injury has been discussed above in the section
on threat of material injury. In this section we summarize the basis of our determination that the
domestic industry producing hand trucks and certain hand truck parts is not materially injured by reason
of subject imports from China.'*°

(continued)
distribution, (accounting for approximately *** percent of the U.S. market over the period examined), and the size of
the accounts, it is unlikely that the domestic industry can regain sales lost from that channel, from other, smaller
channels of distribution.

18 19 U.S.C. §§ 1671d(b) and 1673d(b).

18119 U.S.C. § 1677(7)(B)(i).. The Commission “may consider such other economic factors as are relevant to the
determination” but shall “identify each [such] factor . . . [a]nd explain in full its relevance to the determination.”

19 U.S.C. § 1677(7)(B). See also Angus Chemical Co. v. United States, 140 F.3d 1478 (Fed. Cir. 1998).

12 19 U.S.C. § 1677(7)(A).

3 19 U.S.C. § 1677(7)(C)(iii).

‘19 U.S.C. § 1677(7)(C)(iii).

185 None of the parties has made any arguments with respect to the application of 19 U.S.C. § 1677(7)(I) to this
case. As required by that statutory provision, we have considered whether any change in the volume, price effects or
impact of subject imports since the filing of the petition on November 13, 2003, is related to the pendency of the
investigation.

The pendency of the investigation clearly affected the behavior of certain important purchasers of both the
subject merchandise and domestic product, but the effect was largely to stabilize, rather than reverse, the effects of
the subject merchandise. Thus, we do not find a basis to give less weight to interim 2004 data. However, the record
indicates that unless an order is issued, material injury by reason of subject imports would occur, in part in light of
the decision of those purchasers to postpone increased importations or purchases of the subject merchandise

(continued...)

26


32042

Federal Register/Vol. 69, No. 110/Tuesday, June 8, 2004/ Notices

INTERNATIONAL TRADE
COMMISSION

[Investigation No. 731-TA-1059 (Final)

Hand Trucks From China

AGENCY: United States International
Trade Commission.

ACTION: Scheduling of the final phase of
an antidumping investigation.

SUMMARY: The Commission hereby gives
notice of the scheduling of the final
phase of antidumping investigation No.
731-TA-1059 (Final) under section
735(b) of the Act (19 U.S.C. 1673d(b)) to
determine whether an industry in the
United States is materially injured or
threatened with material injury, or the
establishment of an industry in the
United States is materially retarded, by
reason of less-than-fair-value imports
from China of hand trucks, provided for
in subheadings 8716.80.50 and


Table VII-2

Finished hand trucks: Chinese production capacity, production, shipments, and inventories, 2001-03,
January-June 2003, January-June 2004, and projected 2004-05

Actual experience Projections
January-June
Item 2001 2002 2003 2003 2004 2004 2005
Quantity (units)
Capacity 2,050,000 | 2,050,000 | 2,000,000 | 1,000,000 900,000 | 1,800,000} 1,800,000
Production 1,631,546 | 1,861,800 | 1,896,000 950,000 670,000 | 1,400,000} 1,700,000
End of period inventories 7 + vs ars os a
Shipments:
Internal consumption “ ile ” hailed ial ile hailed
Home market aes +e pees cry 7 oe ee
Exports to--
The United States 687,594 | 744,423 931,194 513,733 iil “ ed
All other markets’ ** | 1,006,469 902,000 378,000 394,563 854,000} 1,068,000
Total exports 1! 1,750,892 | 1,833,194 891,733 hd “ ia
Total shipments 1,636,546 | 1,882,892 | 1,893,594 939,733 702,079 | 1,430,000 | 1,700,000
Ratios and shares (percent)
Capacity utilization 79.6 90.8 94.8 95.0 74.4 778 94.4
Inventories to production - hel iil 7 il a" ial
Inventories to total
shipments fee ord ie ee ie ae aes
Share of total quantity of
shipments:
internal consumption ae wee wee ae ae whe ae
Home market pry rs + ns pore pry
Exports to--
The United States 42.0 39.5 49.2 54.7 “ “ ~“
All other markets’ id 53.5 47.6 40.2 56.2 59.7 62.8
All export
markets id 93.0 96.8 94.9 * “ ld

* Other principal export markets include Australia, Europe, and Japan.

Note — Because of rounding, figures may not add to the totals shown.

Source: Compiled from data submitted in response to Commission questionnaires.

VII-2



*** accounted for only *** percent of the finished hand truck production reported by the ten
responding domestic producers in 2003, and ***.?> *** is a related party by virtue of having imported
subject merchandise over the period examined.”* It imports much more subject product than it produces
domestic product,”’ but does not appear to have received a financial benefit from its importation. Its
financial performance measured either in terms of operating income or operating margins ***.*
Accordingly, we do not exclude this producer from the domestic industry.

*** accounted for *** percent of reported domestic production of finished hand trucks in 2003.”
*** on the petition.*° *** purchased subject imports of hand truck parts from importers ***. All of ***
subject imports over the period examined were sold to ***.’' Thus, we find that *** purchase of one
hundred percent of *** subject imports qualifies it as a related party? *** did not purchase subject hand
truck parts in 2001. In 2002, the ratio of the value of its purchases of hand truck parts to the value of its
net sales of finished hand trucks was *** percent, and in 2003, it was *** percent. This ratio was ***
percent in interim 2004 as compared to *** percent in interim 2003. *** operating margins were *** the
industry average. Its operating income did ***.*> However, there is no indication that it derived a
financial benefit from its purchases of subject imports, ***. Therefore, for all of these reasons, we do
not exclude *** from the domestic industry.

Domestic producer *** is a related party because it imported subject merchandise. ***
accounted for *** percent of reported 2003 domestic production of finished hand trucks. ***.** ***
subject imports ranged from *** to *** percent of its domestic production during 2001 to 2003, and
January to June 2004.° *** operating income increased between 2001 and 2003, which was not
consistent with the trend for the overall domestic industry, but its operating income was lower in interim
2004 than in interim 2003. *** had *** throughout the period examined but, on average, these margins
were only somewhat above the domestic industry average.** *** stated that it has imported hand trucks

?5 CR/PR at Table IlJ-1, III-5.

?6 CR/PR at Table III-5.

27 #**°s subject imports were *** percent of its domestic production in 2001, *** percent in 2002, *** percent in
2003 and *** percent of its domestic production in interim 2004. It did not import subject merchandise in interim
2003. CR/PR at Table III-5.

28 CR/PR at Table VI-2. *** experienced *** throughout the period examined, which was not the case for the
other domestic producers. Id.

?° CR/PR at Table IlI-1.

* CR/PR at Table III-1.

*! CR/PR at Table HI-10, n.2.

2 A domestic producer that does not itself import subject merchandise, or does not share a corporate affiliation
with an importer, may nonetheless be deemed a related party if it controls large volumes of imports. The
Commission has found such control to exist where the domestic producer was responsible for a predominant
proportion of an importer's purchases and the importer's purchases were substantial. See, e.g., Foundry Coke from
China, Inv. No. 731-TA-891 (Final), USITC Pub. 3449 (September 2001) at 8-9; See also SAA at 858. ***, ***,

+ Compare CR/PR at Table VI-2 with CR/PR at Table III-10.

** CR/PR at Table II-1, III-5.

+> CR/PR at Table III-5.

36 margins were ***, CR/PR at Table VI-2. *** average operating margin for all periods surveyed except
interim 2003 was *** percent. The average operating margin for the entire domestic industry, for the same period
was *** percent. Calculated from CR/PR at Table VI-2 and Table VI-5.



Table II1-1
Hand trucks and parts: U.S. producers, positions on the petition, U.S. production locations, product

roduced, and shares of reported 2003 production
Shares of reported 2003
Firm Position Production Product production (percent)
location(s) produced’
Finished Parts?
American Power Pull a Ohio Ss “ _
Angelus “ California S,A° we _
Anthony ~~ California Ss lel -_
B&P Support Michigan A hail el
Fairbanks hal Georgia SA ial _
Faultless bil South Dakota Ss (‘) -
illinois, “
Gleason Petitioner Indiana® S,A,N =
Harper Support Kansas S,A,N ial _
Magline Support Michigan A aiid il
Valley Craft® had Minnesota S.A bail _
Wesco Support Pennsylvania S, A” hed _
Total 100.0 100.0

‘ § = steel, A = aluminum, and N = nylon.

? Includes frames, handling areas, projecting edges (toe plates), and unassembled kits.

? Angelus also produces an aluminum-steel hand truck.

res

5 The United Food and Commercial Workers International Union (UFCW), which represents Gleason’s manufacturing
workers in Indiana, filed a letter in support of the petition on December 1, 2003, and the Laborer’s International Union of North
America, which represents Precision Products’ manufacturing workers, in Illinois filed a letter in support of the petition on
December 9, 2003.

® Valley Craft is 100-percent owned by Liberty Diversified, Inc., an importer of finished hand trucks and unassembled hand
truck kits located in Minnesota.

7 Wesco also produces a magnesium hand truck.
Source: Compiled from data submitted in response to Commission questionnaires.

January-June 2003.5 Total U.S. production of hand trucks increased by 2.2 percent from 2001 to 2002,
remained stable in 2003, but was 9.8 percent lower in January-June 2004 than in January-June 2003.°
Capacity utilization increased by 1.4 percentage points from 2001 to 2002, then decreased by 0.3
percentage point in 2003, and was 11.8 percentage points lower in January-June 2004 than in January-
June 2003.” U.S. producers reported the following constraints on their production: material availability,

5 The recent increase in reported capacity in the United States reflects ***.
6 ee

7 *** of the unused capacity was reported by Gleason. Gleason initially calculated its capacity ***. In addition,
***, Gleason’s work stations are *** dedicated to hand trucks and its production workers are *** dedicated to hand
trucks. Staff reduced Gleason’s reported capacity by *** units, the capacity of ***, and Gleason subsequently

(continued...)

Tu-2


60984

Federal Register/Vol. 69, No. 198/Thursday, October 14, 2004/ Notices

process. On the first day of Xinghua’s
FOP verification, the Department found
that, despite the specific instructions
given in the verification outline,
Xinghua had few source documents
prepared in advance for review and
those that were prepared were
inadequate to support the data
submitted to the Department by
Xinghua. See Xinghua Verification
Report at 14 and 15. Department
officials reiterated to Xinghua the need
to provide the information requested in
the outline but throughout the
remaining time allocated for the full
verification, Xinghua was unable to
provide the required information in the
form requested by the Department. See
Xinghua Verification Report at 14.
Because Xinghua was unprepared for
verification, and was unable to provide
the sou-ce documentation required, the
Departmen: was not able to verify
Xinghua’s factors of production.
Specifically, Xinghua was not able to
provide source documentation
supporting its reported consumption of
raw materials, energy and labor for the
production of hand trucks, or otherwise
explain how it derived the factor inputs
it reported to the Department. Thus, the
Department was unable to verify the
factors of ,-roduction Xinghua reported
for its prouuction of hand trucks.

Furthermore, numerous discrepancies
were found in verifying Xinghua’s
reported U.S. sales data. See Xinghua
Verification Report at 7. Because of
these discrepancies, we were not able to
verify Xinghua’s reported quantity and
value of sales to the United States.

Pursuant to section 776(a)(2) of the
Act, the Department must use facts
otherwise available because Xinghua
withheld certain information that had
been requested by the Department,
failed to provide certain information by
the Department’s statutory deadlines
and in the form and manner requested,
and failed to provide certain
informeiior. that could be verified. We
further detsrmine that an adverse
inference is warranted in selecting from
among the facts available because
Xinghua failed to cooperate to the best
of its ability at verification. Specifically,
Xinghua was not able to explain
discrepancies in its reported sales data
nor to provide source documentation for
or explain the reported FOP for its hand
trucks.

Because the Department was unable
to verify Xinghua’s FOP and sales data,
we have no reliable data to calculate a
margin for the final determination. In
accordance with sections 776(a)(2)(A),
(B), (C), and (D), as well as section
776(b) of the Act, we are applying total
adverse facts available to Xinghua. As

adverse facts available, we are assigning
Xinghua the rate of 386.75 percent
which is also the PRC-wide rate, and the
highest margin listed in the notice of
initiation, as corroborated by the
Department.

New Factual Information

As stated above in the “Case History”
section, both Huatian and Taifa
submitted revised U.S. sales and FOP
databases on July 30, 2004. Taifa’s July
30, 2004, submission included minor
error corrections presented to the
Department at the beginning of
verification, revised usage data for
allocated inputs (discussed above in the
“Use of Facts Otherwise Available”
section), and other changes unrelated to
the minor error corrections or allocated
inputs. Huatian’s July 30, 2004,
submission included minor error
corrections presented to the Department
at the beginning of verification and
certain other changes unrelated to the
minor error corrections.

For both companies, we are treating
these other changes as untimely filed,
unsolicited factual information.

Under 19 CFR 351.302(d), the
Department normally would reject
Huatian’s and Taifa’s July 30, 2004,
submissions in their entirety and
request the companies resubmit their
revised FOP responses without the new
information. However, due to time
constraints and the pending final
determination in this investigation, it
was not feasible for the Department to
reject and return Huatian’s and Taifa’s
July 30, 2004, submissions, request
revised submissions, and still be able to
issue a final determination by the
statutory deadline of October 6, 2004.
As such, the Department has retained
Huatian’s and Taifa’s July 30, 2004,
submissions in their entirety. Although
we have retained these responses, we
have not considered the untimely filed,
unsolicited information in making our
final determination. See Comments 1
and 7 of the Decision Memorandum.

Analysis of Comments Received

All issues raised in the case briefs by
parties to this proceeding and to which
we have responded are listed in the
Appendix to this notice and addressed
in the Decision Memorandum, which is
adopted by this notice. Parties can find
a complete discussion of all issues
raised in this investigation and the
corresponding recommendations in this
public memorandum, which is on file in
the Central Records Unit, room B-099,
of the main Department building. In
addition, a complete version of the
Decision Memorandum can be accessed
directly on the Web at hitp://

ia.ita.dac.gov or http://ia.ita.doc.gov/
fon/index.html. The paper copy and
electronic version of the Decision
Memorandum are identical in content.

Changes Since the Preliminary
Determination

Based on our analysis of comments
received, we have made certain changes
to the margin calculations. For a
discussion of these changes, see the
“Margin Calculations” section of the
Decision Memorandum.

Verification

As provided in section 782(i) of the
Act, we verified the information
submitted by the respondents for use in
our final determination. We used
standard verification procedures
including an examination of relevant
accounting and production records, and
original source documents provided by
the respondents.

Continuation of Suspension of
Liquidation

Pursuant to section 735(c)(1)(B) of the
Act, we will instruct Customs and
Border Protection (“CBP”) to continue
to suspend liquidation of all imports of
subject merchandise from the PRC
entered, or withdrawn from warehouse,
for:cusumption on or after May 24,
2004 he date of publication of our
Preliminary Determination, CBP shall
contiaue to require a cash deposit or the
posting of a bond equal to the estimated
amount by which the normal value
exceeds the U.S. price as shown below.
These instructions suspending
liquidation will remain in effect until
further notice.

‘The dumping margins are provided
below.

Weighted-average
Manutacturer/Exporter margin
(percent)

45.04

Taifa . 27.00
True Potential 24.90
Xinghva 386.75
Future Tool 30.96
Shandong 30.56
PRC-wide 386.75

The PRC-wide rate applies to all
entries of the subject merchandise
except for entries from exporters/
producers that are identified
individually above.

Disclosure

We will disclose the calculations
performed within five days of the date
of publication of this notice to parties in
this proceeding in accordance with 19
CFR 351.224(b).


PART VI: FINANCIAL EXPERIENCE OF U.S. PRODUCERS
BACKGROUND

Eight firms provided usable financial data on their U.S. operations producing hand trucks and
certain hand truck parts.' Magline reported separate profit and loss information on certain hand truck
parts, as well as finished hand trucks.” All other producers reported financial results on finished hand
trucks only. Gleason’s questionnaire data were verified by Commission staff on September 29 and 30,
2004. All revisions to Gleason’s questionnaire data are reflected in this and other relevant sections of the
report.

OPERATIONS ON HAND TRUCKS

Results of U.S. firms’ operations on finished hand trucks and selected company-specific financial
information are presented in table VI-1 and table VI-2, respectively. Table VI-3 presents a variance
analysis of finished hand truck operations.’

Financial results on hand trucks were dominated by Gleason which accounted for *** percent to
*** percent of total reported net sales value during the period for which data were collected. As shown
in table VI-2, company-specific product mix is reflected in relatively large differences in average unit
revenue and cost of goods sold (COGS). ***.*

Higher raw material costs were the largest contributor to the overall negative cost/expense
variance shown in table VI-3. ***.°

Average unit direct labor and other factory costs also increased somewhat, but ended the period
at about the same level as the beginning (direct labor) or modestly lower (other factory costs). The
modest increases in average unit other factory costs were generally related to specific overhead costs.
#eE

Price variances, although favorable in several period comparisons, only partially offset the
period-to-period increases in average unit COGS.’ The result was negative hand truck operating income

' The financial results reflect the following periods: Angelus, Fairbanks, Gleason, Harper Trucks, and Magline —
calendar year; Valley Craft — fiscal year ending May; American — fiscal year ending September; and Wesco — fiscal
year ending October. Anthony Welded and B&P failed to report their financial results on hand trucks, despite
repeated follow-up requests by USITC staff. ***.

2 ee

> The variance analysis on hand truck operations is derived from information presented in table VI-1 and provides
an assessment of changes in profitability related to changes in pricing, cost, and quantity. A variance analysis is
most effective when the product involved is homogeneous with no variations in inter-company and intra-company
product mix. As indicated in table VI-2, hand truck product mix varied by company and, in some cases, company-
specific product mix changed from period to period.

* *#*, telephone interview by USITC staff, August 25, 2004.

5 ***, e-mail response to USITC staff follow-up questions, August 25, 2004. ***, telephone interview by USITC
staff, August 25, 2004. ***, telephone interview by USITC staff and e-mail response to follow-up questions, August
27, 2004. Questionnaire response of ***, question III-11, p. 13.

© ***, e-mail response to USITC staff follow-up questions, August 25, 2004. ***, telephone interview by
USITC staff, August 25, 2004. ***, telephone interview by USITC staff and e-mail response to follow-up questions,
August 27, 2004.

7

VI-1


The Domestic Like Product

The Commission’s determination regarding the appropriate domestic product that is “like” the
subject imported product is based on a number of factors including: (1) physical characteristics and uses;
(2) common manufacturing facilities and production employees; (3) interchangeability; (4) customer and
producer perceptions; (5) channels of distribution; and (6) price.'' Information on customer and producer
perceptions can be found in Part II. Data on the prices of hand trucks during the period for which data
were collected can be found in Part V. Information regarding the physical characteristics and uses of
hand trucks as well as manufacturing facilities and production employees, interchangeability, and
channels of distribution of domestic and imported hand trucks is set forth below.

Physical Characteristics and Uses

Hand trucks exhibit four general physical characteristics: (1) a frame; (2) a handling area; (3)
two or more wheels; and (4) a projecting edge or edges perpendicular, or at an angle, to the frame.'> The
frame is made primarily from steel, aluminum, or nylon, although it is possible to manufacture the frame
from other raw materials. The handling area and projecting edges are normally but not always made
from the same material as the frame, although in certain configurations all or portions of the handling
area may be covered by hand protector grips manufactured from plastic, vinyl, foam, or other material.'*
The large majority of hand trucks sold in the United States are produced from steel components.'*

Hand trucks are used for tasks related to material handling when there is a need to move objects
generally not exceeding 1,000 pounds over short distances. Hand trucks can be employed for indoor or
outdoor use, under a great variety of working conditions, rolling over different types of surfaces, and
carrying every type of load. The majority of hand trucks sold are designed for general use, but certain
hand trucks are designed for specific tasks, including the transport of appliances, cylinders, barrels, bags,
trees, or plants. Newer designs and technology allow certain hand trucks to be folded or collapsed.'°
Hand truck parts are used almost exclusively for the production of finished hand trucks; only one out of
the ten responding U.S. producers reported using the components it produces for finished hand trucks in

" Petitioners contend that the Commission should “define a single like product in this investigation that includes
finished hand trucks and hand truck parts as described in the U.S. Department of Commerce’s scope definition.”
Gleason prehearing brief, p. 1. The respondents have not raised any domestic like product issues during the final
phase of this investigation, nor did they submit any comments on the draft final questionnaires in the final phase of
the investigation.

” Bvery hand truck frame includes vertical side rails normally connected by laterally extending braces. The
upper portion or rear portion of the vertically disposed frame incorporates a handling area for maneuvering the hand
truck. This handling area can be a part of the frame, but it also can be attached to the upper portion of the frame and
appear as a distinct appendage. A load support nose member (which is also known as a base or toe plate) is
connected to the lower front portion of the frame. At least two wheels are connected to the lower rear portion of the
vertically disposed frame. The wheels, unless they are casters, are normally connected by an axle. Petition, pp. 6-8;
petition supplement, pp. 1-4.

' Petition, pp. 6-8; petition supplement, pp. 1-4. The composition of the wheels used is not critical to the actual
operation of the hand truck, although composition and size could affect a hand truck’s maneuverability on different
surfaces. Id.

‘4 Hearing testimony indicated that aluminum hand trucks account for 10-20 percent of the U.S. market, nylon
hand trucks for three percent, and steel hand trucks for the remainder of the market. Hearing transcript, p. 84 (Straw,
Kvasnicka).

‘5 Hearing transcript, p. 156 (LaFontaine); letter from Alton Industries, Inc., October 21, 2004.

14


Table II-3
Hand trucks: Interchangeability of product from different sources’

U.S. producers U.S. importers Purchasers

Countrycomparison | A | F}S|N}O;A/FI]S/|N/O}/AJ/F]S/|N]O

U.S. vs. China 34,2] 3 1 1 8/8 | 9 {12 | 10] 6 4 1 0 | 13

U.S. vs. Nonsubject 2)1 1 0o;6)]3 14 414 1] 0 | 264 2 0) 1 Oo | 21

China vs. Nonsubject 241 o;/o;]7;2)]5 )]3 4) 0 |27] 2 0 1 oO | 21

* Producers, importers, and purchasers were asked if hand trucks 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.

frame, handles, and toe plates often require some fastener holes to be relocated for proper assembly.
Among importers, two firms stated that the Chinese-produced hand trucks are made primarily for
consumers, while the U.S.-produced products tend to be heavier, more durable, or more expensive, and
are made primarily for commercial or industrial use. However, another importer stated that imports from
China are of better quality, and are more durable. Another importer stated that it offers a product with
multiple conversion capabilities that is not available from any U.S. producer. One purchaser stated that
the quality of the Chinese-produced hand trucks is not always as good as that of U.S.-produced products.
In addition to questions concerning interchangeability, producers and importers also were asked
to compare U.S.-produced products with imports from China in terms of product differences such as
quality, availability, product range, and other factors that affect sales. Again, firms were asked whether
these product differences are always, frequently, sometimes, or never significant. A majority of both
producers and importers reported that the differences are never or sometimes significant (table II-4).'° ''
*** reported that U.S. producers, including itself, carry certain styles of hand trucks that are not
available from Chinese producers. *** stated the its product quality, reputation, and service to customers
has often given it an advantage over competitors.'? Among importers, one firm stated that it occupies a
market niche for households that have occasional need of a hand truck, cart, stepladder, or stand. It
reported that its product is a proprietary design that is not made by any other manufacturer. Another
importer reported that its offers a lighter weight product that is often less expensive than the heavier
U.S.-produced hand truck. One importer that used to purchase U.S.-produced hand trucks reported that it
often experienced delivery delays with domestic producers, but that it has not had that problem with
imports. One importer reported that it switched from purchases from Gleason mainly because of quality

*° One importer, ***, stated in its import questionnaire that the quality of the Chinese product is superior.
However, in its purchaser questionnaire, it ranked the Chinese and U.S. products comparable.

' *4* an importer that sells folding hand trucks, reported that factors that have affected its past hand truck sales
have been product quality, reliability, and availability.

"2 Elsewhere in its questionnaire, *** reported that the Chinese products are marketed as equal to those of ***,
but the product quality of these imports is inferior.

1-6


APPENDIX F

ALLEGED EFFECTS OF IMPORTS OF HAND TRUCKS AND CERTAIN
PARTS THEREOF FROM CHINA ON U.S. PRODUCERS’ EXISTING
DEVELOPMENT AND PRODUCTION EFFORTS, GROWTH,
INVESTMENT, AND ABILITY TO RAISE CAPITAL

F-l


PART III: U.S. PRODUCERS’ PRODUCTION, SHIPMENTS, AND
EMPLOYMENT

The Commission analyzes a number of factors in making injury determinations (see 19 U.S.C. §§
1677(7)(B) and 1677(7)(C)). Information on the margins of dumping was presented earlier in this report
and information on the volume and pricing of imports of the subject merchandise is presented in Parts IV
and V. Information on the other factors specified is presented in this section and/or Part VI.

U.S. PRODUCERS

The Commission sent producer questionnaires to 21 firms. Ten firms provided responses to the
Commission’s producer questionnaire and are believed to have accounted for approximately 90 percent
of U.S. production of hand trucks and parts during the period for which data were collected.!”

Presented in table II-1 is a list of the domestic firms that produce hand trucks that responded to
the Commission’s producer questionnaire. Also presented is information concerning each company’s
position on the petition, production location(s), product line, and its share of reported 2003 domestic
production of hand trucks and parts. One company, Valley Craft, is wholly owned by a U.S. importer,
Liberty Diversified. Valley Craft manufactures specialty hand trucks that are specifically designed for
items such as oil drums.> B&P and Magline are the only U.S. producers to report production of parts of
hand trucks. B&P and Magline produce and sell frames, handling areas, projecting edges (toe plates),
and in the case of Magline, unassembled hand trucks (partial or complete kits).

*** purchased ***.* In contrast, *** reported that due to the threat of termination of relations
with *** it is strategizing about future changes in its operations, including ***. *** reported that its
plant was forced to work reduced hours based on lost business in ***, and that there were several
workforce reductions in ***. *** reported that *** it completed ***.

Table Il-2 presents U.S. producers’ production of other products on equipment and machinery
used in the production of hand trucks and parts, shares of hand trucks and parts production on the same
equipment, production of other products using the same production and related workers employed to
produce hand trucks and parts, and shares of hand trucks and parts production using the same workers.
The U.S. hand truck industry is evenly divided between those companies that produce the domestic like
product with dedicated or near-dedicated equipment and workers and those that do not. The vast
majority of domestic production, however, is accounted for by companies that fall into the former
category.

U.S. CAPACITY, PRODUCTION, AND CAPACITY UTILIZATION OF HAND TRUCKS

Data on U.S. producers’ capacity, production, and capacity utilization for finished hand trucks
are presented in table IIJ-3. Total U.S. capacity decreased by 0.1 percent from 2001 to 2002, then
increased by 0.5 percent from 2002 to 2003, and was 9.3 percent higher in January-June 2004 than in

' Based on questionnaire data and information provided in the petition, exh. 4.

2 *#** provided a limited, incomplete response to the Commission questionnaire. The other 10 firms declined to
respond despite requests by Staff.

> Hearing transcript, p. 185 (LaFontaine).

4p,


Table Il-4
Hand trucks: Differences other than price between products from different sources’

U.S. producers U.S. importers
Country comparison A F Ss N tv) A F Ss N 0
U.S. vs. China 0 3 3 2 2 4 3 13 4 13
U.S. vs. Nonsubject 0 2 3 1 4 2 3 5 2 25
China vs. Nonsubject 0 2 3 1 4 2 1 5 1 28

‘ Producers and importers were asked if differences other than price between hand trucks produced in the United
States and in other countries are a significant factor in their firms’ sales of hand trucks .

Note: “A” = Always, “F” = Frequently, “S” = Sometimes, “N” = Never, and “0” = No familiarity.

Source: Compiled from data submitted in response to Commission questionnaires.

problems including weld splatter, scratches and poor paint jobs.'? That importer reported that the quality
of hand trucks from China has been better.

Purchasers also were asked to compare U.S.-produced hand trucks with imported hand trucks
from China in 15 selected characteristics shown in table II-5, noting whether the domestic product was
superior, comparable, or inferior to the imports. Twelve purchasers provided comparisons for the
selected categories. The U.S. product was rated superior by a majority of purchasers in terms of delivery
time and technical support/service, and the Chinese product was rated superior by a majority of
purchasers in terms of price (i.e., lower price). In all other categories, a majority of purchasers
considered the U.S. and Chinese products comparable, although an appreciable minority of purchasers
viewed the U.S. product as superior in terms of reliability of supply, product consistency, and quality
exceeding industry standards.

‘3, an important ***, cited these problems with *** products in its importer questionnaire, *** stated in its
purchaser questionnaire that U.S.-produced hand trucks and imports from China are comparable in quality.

I-7


Table VI-3

Hand trucks: Variance analysis on results of operations, fiscal years ended 2001-03, and January-

June 2003-2004

Fiscal years ended:' January-June
Item 2001-2003 2001-2002 2002-2003 2003-2004
Value ($1,000)

Total net sales

Price variance (317) 772 (1,114) 120

Volume variance 60 (1,599) 1,684 (2,031)

Total net sales variance (258) (827) 569 (1,911)
Cost variance

Raw material (1,907) (283) (1,615) (294)

Direct labor (181) (368) 198 69

Other factory costs (233) (251) 25 8
Total cost variance (2,321) (901) (1,391) (217)
Volume variance (44) 1,194 (1,267) 1,585
Net COGS variance (2,366) 293 (2,659) 1,368
Gross profit variance (2,624) (534) (2,089) (543)
SG&A variance

Expense variance (306) (385) 91 (242)

Volume variance (8) 212 (233) 261

Total SG&A variance (314) (172) (141) 20
Net operating income variance (2,937) (707) (2,231) (623)
Summarized as:
Price variance (317) 772 (1,114) 120
Net cost/expense variance (2,627) (1,286) (1,300) (459)
Net volume variance 7 (193) 184 (184)

* See footnote 1, table VI-1.

Source: Compiled from data submitted in response to Commission questionnaires.

Capacity utilization affects costs and profitability primarily through changes in the level of fixed
cost absorption; i.e., lower production volume results in fixed “other factory costs” being spread over

fewer units. ***.'° ***,!!

10 ***, telephone interview by USITC staff, September 10, 2004.
1! #**, e-mail response to USITC staff follow-up questions, September 15, 2004.

VI-4





PART II: CONDITIONS OF COMPETITION IN THE U.S. MARKET
U.S. MARKET SEGMENTS/CHANNELS OF DISTRIBUTION

Hand trucks are used for material handling tasks when there is a need to move objects generally
not exceeding 1,000 pounds over short distances. Hand trucks can be used indoors or outdoors under a
variety of working conditions. According to the petitioner, companies that sell a broad spectrum of hand
trucks advertise different styles of hand trucks as a continuous line of products designed for the purpose
of handling material over short distances.'

Hand trucks are sold through a variety of channels of distribution.’ U.S. producers sell hand
trucks to home improvement stores, hardware stores, catalog houses/industrial supply distributors, club
warehouses and large scale retailers, and in some cases to end-use customers, such as trucking
companies.’ Similarly, hand trucks from China typically are sold through home improvement stores,
hardware stores, and catalog houses/industrial supply distributors, and club warehouses, as well as to
office supply stores and to individual consumers through direct response campaigns (e.g. televised
marketing).* A detailed presentation of customer groupings and channels of distribution appears in Part I
of this report.

U.S.-produced hand trucks and imports from China are sold throughout the United States. When
asked to indicate the geographic areas for the hand trucks that they sell, *** responding U.S. producers
and the majority of importers of hand trucks from China reported that they sell nationally. However,
some importers reported that their sales are limited to specific regions such as the Northeast, the Middle
Atlantic area, the Southeast, the Midwest, and the Southwest. One importer reported that its sales are
limited to California.

Producers and importers were asked to report the percentage of their sales that were made from
inventory and also the percentage that occurred as a result of special orders. The largest producer,
Gleason, reported that *** percent of its sales are from inventory. For the other responding producers,
sales from inventories accounted for between 5 and 100 percent of total sales. Among the 21 responding
importers selling hand trucks and parts at the same level of trade as U.S. producers, 12 reported that they
sell exclusively from inventories, eight reported that all of their sales consist of items produced to order,
and one firm indicated that 70 percent of sales are from inventory and 30 percent are of items produced
to order.*

Producers and importers also were asked to report delivery lead times for hand trucks sold from
inventories and hand trucks sold as a result of a special order. For producers, lead times for items sold
from inventory ranged from one to five days, and lead times for special order items ranged from five to

'Gleason postconference brief, p. 5.

? Information on markets for parts was limited. Only three companies reported purchases of parts in their
questionnaires during January 2001 through June 2004. One catalog house/industrial distributor reported purchases
of U.S.-produced frames, handling areas, and edges and purchases of imported frames and edges from nonsubject
sources. Another purchaser, an end user, reported purchases of parts, including frames, handling areas, edges, and
unassembled kits produced in the United States and imported from nonsubject sources, and frames, handling areas,
and edges imported from China. A third purchaser, a hardware store, reported that it purchased U.S.-produced parts,
but did not specify the parts.

3 Conference transcript, pp. 23, 55 (Kvasnicka).

* Hand trucks from China are also imported directly by home improvement stores and catalog houses.

5 These responses are by importers that sell at the same level of trade as U.S. producers. They do not include
responses by importers that sell directly to retail customers or to end users.

T-1


APPENDIX E

PRICES REPORTED BY INDIVIDUAL PRODUCERS,
BY PRODUCT AND BY CHANNEL OF DISTRIBUTION

E-1


| U.S. International Trade Commission

Washington, DC 20436
www.usilc. gov

Hand Trucks and Certain Parts
Thereof From China

Investigation No. 731-TA-1059 (Final)

Publication 3737 November 2004




of arriving at prices include transaction-by-transaction negotiations and contract negotiations. Price lists
frequently are used as a starting point for negotiations.

U.S. producers and importers of hand trucks from China most commonly quote prices on an
f.o.b. basis. Among U.S. producers, *** quotes prices on an f.o.b. warehouse basis. Of the other
responding producers, most use f.0.b. quotes, although one offers delivered quotes. The majority of
importers also quote on an f.o.b. basis, although several quote prices on a delivered basis.

Discount policies on sales of hand trucks vary widely. Among producers, Gleason reported that
it ***, Eight of the other nine U.S. producers also reported the use of discounts. In general, quantity
discounts were most common, although one firm provides discounts based upon a customer’s annual
purchases in the previous year. Four of these producers also provide discounts for early payments of
accounts ranging from one-half percent to two percent for payment within 10 days. Among the 25
responding importers, 15 reported that they provide discounts, generally based upon volume. Seven
importers also stated that they provide discounts for early payments of accounts, ranging widely from
one-half percent for payment within 10 days to two percent for payment within 20 days. Ten importers
reported that they do not provide any form of discount, not even credit for the early payments of
accounts.

U.S. producers and importers of hand trucks from China were asked what share of their sales
were on a (1) long-term contract basis (multiple deliveries for more than 12 months), (2) short-term
contract basis, and (3) spot sales basis (for a single delivery). Among U.S. producers, *** reported that
*** sales were on a short-term contract basis. Another producer reported that 60 percent of its sales are
on a long-term basis, 30 percent are on a short-term contract basis, and 10 percent are on a spot basis. A
third producer stated that 9 percent of its sales are on a long-term contract basis, 90 percent are on a
short-term contract basis, and 1 percent are on a spot basis. The other three responding producers do not
use contracts. Among importers, most reported that they sell on a spot basis.

Contract provisions varied widely for firms selling on a contract basis. Gleason reported that
*** 5 The other two U.S. producers that use contracts reported that they are typically for one year in
duration. Both firms reported that prices are fixed, and one also reported that quantities are fixed.
Neither firm has meet-or-release provisions in its contracts. Among the eight importers reporting the use
of contracts, contract periods are most commonly for one year, although two importers reported that they
are for shorter periods and one reported that they are for longer periods. Prices generally are fixed during
the contract period, and in some cases, quantities are fixed. Three of the importers reported that their
contracts contain meet-or-release provisions.

PRICE DATA

The Commission asked U.S. producers and importers of hand trucks from China to provide
quarterly data for the total quantity and value of selected products that were shipped to unrelated
customers in the U.S. market during January 2001 through June 2004. Data were requested separately
for sales to home improvement stores, hardware stores, and catalog houses/industrial supply distributors.
In addition, those importers that sell directly to retail or other end use consumers were requested to
provide the landed duty-paid values of imports on a quarterly basis. The products for which pricing data
were requested are as follows:

5 Among Gleason’s major customers, Lowe’s typically conducts a line review every year, while Home Depot
maintains its product program until given a reason to change. Hearing transcript, pp. 86-88 (Kvasnika, Simon).

V-2




CALENDAR OF PUBLIC HEARING

Those listed below appeared as witnesses at the United States International Trade
Commission’s hearing:

Subject: Hand Trucks from China
Inv. No.: 731-TA-1059 (Final)
Date and Time: October 7, 2004 - 9:30 a.m.

Sessions were held in connection with this investigation in the Main Hearing Room (room
101), 500 E Street, SW, Washington, D.C.

OPENING REMARKS:

Petitioner (Matthew P. Jaffe, Crowell & Moring, LLP)
Respondents (Philippe M. Bruno, Greenberg Traurig, LLP; and
Mark S. Zolno, Katten Muchin Zavis Rosenman)

In Support of the Imposition of
Antidumping Duties:

Crowell & Moring, LLP
Washington, D.C.
on behalf of

Gleason Industrial Products, Inc.
Precision Products, Inc.

Harper Trucks, Inc.

Magline Inc.

Howard Simon, Chief Operating Officer, Gleason
Industrial Products, Inc., and Precision Products, Inc.

Jay Kvasnicka, Corporate Vice President, Sales and
Marketing, Gleason Industrial Products, Inc.

B-3


USS. products were generally higher-priced than subject imports.'** Gleason lost ***, **#, **#,'%4
Commission staff confirmed other allegations of lost sales, and allegations of lost revenues.'* As
discussed in detail above, *** alleged lost sales involving *** that we found would have occurred or
continued were it not for the pendency of this investigation and the potential for further antidumping
duties.'°°

In light of the importance of price in purchasing decisions, the significant and increasing volume
of subject imports from 2001 to 2004, consistent underselling often at high margins, and the fact that,
absent issuance of an antidumping duty order, significant accounts would likely be lost by the domestic
industry to subject imports, we find that low import prices are likely to generate demand for higher
volumes of subject imports.

We have also considered movements in hand truck prices, both currently and in the likely
imminent future, relying principally on the pricing data collected by the Commission on hand trucks
Products 1-4.'5’ The Commission’s pricing data reflects stable or decreasing domestic prices with
respect to high-volume Products 1 and 2 in the home improvement and hardware channels of distribution.
Domestic prices in these channels tended to be at their lowest levels over the period surveyed in interim
2004. Subject import prices also decreased for those products in those channels, with the exception of
Product 2 in the hardware channel of distribution.'** In contrast, prices for domestic and imported
Products 1 and 2 in the catalog/industrial distributor channel of distribution tended to either be stable or
increase.'” Prices for Product 3, a specialty hand truck, and Product 4, an aluminum hand truck, also

'53 Nine purchasers indicated that subject imports were lower priced, three reported that they were comparable in
price, and none reported that U.S. products were lower-priced than subject imports. CR/PR at Table II-5.

'S4 Tn the preliminary phase of the investigation, ***. However, Grainger acknowledged ***. CR at V-28-29 &
n.19; CR at V-9 & n.9.

We note that our pricing data for Product 4 reflects a significant increase in direct imports by catalog firms
at low landed duty-prices in interim 2004. These data reflect in large part ***. CR/PR at Table V-11. ***.

185 hand trucks from Chinese sources rather than domestic sources in ***, *** and *** confirmed lost
revenues totaling $***. CR at V-27-28 & Tables V-13 and V-14.

186 Gleason Posthearing Brief, Exhibit 11; CR at V-25-26. The record reflects that these sales were almost lost,
primarily, if not solely, due to lower prices for subject imports from China. ***, it did not report in ***. CR at V-
25-26 & nn.12,15; PR at V-9 & nn.12,15. Moreover, in an affidavit filed in the final phase of the investigation, ***.
Chinese Respondents’ Posthearing Brief, ***. Emphasis added. Our data reflect that the landed duty-paid prices for
*** direct imports are significantly lower than domestic prices. CR/PR at Tables V-1, V-4, and V-7.

When Commission staff asked *** what factors contributed to its change in suppliers, he directed staff to
*** purchaser questionnaire which ranks price as the most important factor in purchasing decisions. CR at V-26 &
n.15; PRat V-9 & n.15.
'57 CR/PR at Tables V-1-V-11.

'58 Product 1 is a high-volume general-use steel hand truck with a “d” or “p” shaped handle. Domestic producer
prices of Product 1 to home improvement stores were stable throughout the period examined. Import prices
decreased over the period examined, but were consistently lower than the domestic prices. CR/PR at Table V-1.
Domestic producer prices for Product 1 sold to hardware stores decreased over the period examined, as did prices
for subject imports.

Product 2 is a high-volume convertible steel hand truck. Domestic prices for Product 2 sold to home
improvement stores decreased over the period examined. Prices for subject imports stayed at the same level until the
last quarter of 2003 when they began to decrease. CR/PR at Table V-4. Domestic prices for Product 2 sold to
hardware stores declined irregularly over the period examined, while prices for subject imports fluctuated but
increased slightly. CR/PR at Table V-5.

'59 Domestic producer prices for Product 1 sold to catalog houses/industrial distributors increased irregularly

(continued...)

22


following Commerce’s preliminary determinations in May 2004, it discontinued purchasing imports from
China. ***. ***.!'* Lowe’s announced that it had decided to switch to purchasing hand trucks from
China, but put its importing plans on hold due to concerns regarding potential antidumping duties." ***
has indicated that it ***.!°° ***.'?" Lowe’s conducted a line review of its hand truck purchases in July
2003.’ As a result of that review, it decided to source its hand trucks primarily from China, and
announced that decision in mid-September 2003.'* ***.' Asa result of the antidumping investigation,
Lowe’s postponed its decision to switch suppliers, and continued to purchase hand trucks from
Gleason.'* Lowe’s has stated that if the duties are lifted, it would return to its announced decision to
supply hand trucks primarily from China.'*°

As already discussed, home improvement stores tend to purchase a limited number of models of
general-use hand trucks in large volumes from a single or small number of suppliers, and volume
discounts are common. Given the historical purchasing practices of home improvement stores, we find
that absent antidumping relief, *** will likely purchase a large percentage, if not all, of their hand truck
requirements from China.'?” '"*

Seven purchasers, including ***, stated that the filing of the antidumping petition, the
Commission’s affirmative preliminary determination in January 2004, or Commerce’s preliminary
dumping determination in May 2004 caused them to cancel orders or reduce purchases of imports of
subject merchandise from China.'” *** stated that the preliminary antidumping duty had erased its
profit margin, that it had significantly reduced its purchases of hand trucks from China, and that it
intended to cease purchasing hand trucks from China completely by the end of this year.'*°

We find that unless an antidumping order is issued, it is likely that *** would switch primarily to
purchases of subject imports, as they originally planned. Given the central market position of ***, it is

"8 CR at V-26 & n.15; PR at V-9 & n.15. ***, ***, However, at this time, provisional duties, which ***. He
frankly acknowledges that *** and indicates that *** Chinese Respondents, Posthearing Brief, ***.

"° Tr. at 26, 28, 88 (Kvasnicka); CR at V-27 & n.17; PR at V-9 & n.17.

2 CR at V-27, n.17; PR at V-9 , n.17.

1 CR at V-26-27 & n.17; PR at V-9 & n.17.

1 Ty, at 129 (Rife); CR at V-27 & n.17; PR at V-9 & n.17.

3 Tr, at 129 (Rife).

4 CR at V-26; PR at V-9.

5 Ty, at 26, 28 (Kvasnicka); CR at V-27, n.17; PR at V-9, n.17.

8 Ty, at 26, 28 (Kvasnicka).

"7 Contrary to Chinese Respondents’ arguments, we are not basing our analysis of Home Depot’s or Lowe’s
future actions on conjecture. Both companies canceled plans to switch or fully switch to sourcing subject imports
from China due to the pendency of this investigation and the potential for an antidumping duty on subject imports,
and both companies have stated that they will purchase subject imports if an antidumping order is not issued.
Nothing has changed to indicate that they would reconsider their decision and continue to source hand trucks
primarily from domestic sources if antidumping duties are not imposed.

18 Home Depot states that ***. Chinese Respondents’ Posthearing Brief, Home Depot Affidavit at 2. This is not
persuasive that it will not switch to primarily sourcing their hand trucks through purchasing subject imports, as
originally planned, absent antidumping relief. Subject imports rather than domestic product largely supplied
increased demand over the period examined. The rate of increase in subject import volume measured either in
quantity (finished hand trucks) or by value, far outpaced the increase in apparent consumption in the annual periods
examined.

2° Tr. at 86-88, 129, CR at II-6; PR at II-3-4.

8 CR at II-6; PR at II-3-4,

18


APPENDIX C

SUMMARY DATA

C1


ORGANIZATION OF THE REPORT

Information on the subject merchandise, Commerce’s dumping margins, and the domestic like
product is presented in Part I. Information on conditions of competition and other economic factors is
presented in Part II. Information on the condition of the U.S. industry, including data on capacity,
production, shipments, inventories, and employment, is presented in Part IM. Information on the volume
of imports of the subject merchandise, apparent U.S. consumption, and market shares is presented in Part
IV. Part V presents data on prices in the U.S. market. Part VI presents information on the financial
experience of U.S. producers. Information on the subject country foreign producers and U.S. importers’
inventories is presented in Part VII.

SUMMARY DATA

A summary of data collected in this investigation for the U.S. hand truck market is presented in
appendix C. U.S. industry data are based on questionnaire responses of ten firms that accounted for
approximately 90 percent of U.S. production during January 2001-June 2004. U.S. import data were
compiled using official statistics of the U.S. Department of Commerce and supplemented with data on
hand truck parts from questionnaire responses.

PREVIOUS AND RELATED INVESTIGATIONS

Hand trucks have not been the subject of prior antidumping or countervailing duty investigations
in the United States.

MAJOR FIRMS INVOLVED IN THE U.S. HAND TRUCK MARKET

There are 21 companies believed to produce finished hand trucks and/or hand truck parts in the
United States. The three largest producers are the petitioning firm Gleason, followed by Angelus
Manufacturing (“Angelus”), Montclair, CA, and Harper Trucks, Inc. (“Harper”), Wichita, KS.° Gleason
accounted for *** percent of reported U.S. production in 2003, followed by Angelus (*** percent) and
Harper (*** percent). Two companies, Magline and B&P, reported manufacturing and selling hand truck
parts in the United States.

China has been the largest source of U.S. imports of hand trucks throughout the period for which
data were collected in this investigation (January 2001 through June 2004). The largest reporting
producer and exporter of hand trucks from China is ***. In 2003, the largest importer of finished hand
trucks from China was ***.” Other major U.S. importers of finished hand trucks were: ***.° The largest

° Other U.S. producers include: American Power Pull Corp. (“American Power”), Wauseon, OH; Anthony
Welded Products, Inc. (““Anthony’), Delano, CA; B&P Manufacturing (“B&P”), Cadillac, MI; Clarin, a Division of
Greenwich Industries (“Clarin”), Lake Bluff, IL; Durable USA (“Durable”), Grand Prairie, TX; Dutro Company,
Emeryville, CA; Elkay Products Company, Inc. (“Elkay”), Springfield, NJ; Faultless-Nutting (“Faultless”),
Watertown, SD; Frederick Tool Corp. (“Frederick”), Goshen, IN; Honeyman Aluminum (“Honeyman”), Beaverton,
OR; Lockwood Manufacturing (“Lockwood”), Livonia, MI; Magline, Inc., Pinconning MI; Olympia Inc., City of
Industry, CA; RWM, Gastonia, NC; The Fairbanks Company (“Fairbanks”), Rome, GA; Wesco Industrial Products,
Inc. (“Wesco”), Landsdale, PA; Valley Craft, Lake City, MN; and Yeats Appliance Dolly Manufacturing Company
(“Yeats”), Fullerton, CA.

7 kt

® Of these firms, *** are parties to the investigation.

1-2


Table E-1

Hand trucks: Prices and quantities reported by individual producers on sales of product 1 to home
improvement stores, hardware stores and catalog houses/industrial supply distributors, by quarters,
January 2001-June 2004

Table E-2

Hand trucks: Prices and quantities reported by individual producers on sales of product 2 to home
improvement stores, hardware stores and catalog houses/industrial supply distributors, by quarters,
January 2001-June 2004

Table E-3

Hand trucks: Prices and quantities reported by individual producers on sales of product 3 to home
improvement stores, hardware stores and catalog houses/industrial supply distributors, by quarters,
January 2001-June 2004

Table E-4
Hand trucks: Prices and quantities reported by individual producers on sales of product 4 to hardware
stores and catalog houses/industrial supply distributors, by quarters, January 2001-June 2004

* * * * * * *

E-3


Table Ill-7

Finished hand trucks: Average number of production and related workers producing hand trucks, hours
worked, wages paid to such employees, and hourly wages, productivity, and unit labor costs, 2001-03,
January-June 2003, and January-June 2004'

Calendar year January-June
Item 2001 2002 2003 2003 2004
PRWs (number) 358 370 371 347 327
Hours worked (7,000) 695 726 724 374 377
Wages paid ($1,000) 7,134 7,345 7,721 3,797 3,884
Hourly wages $10.26 $10.12 $10.66 $10.15 $10.32
Productivity (units per hour) 2.0 2.0 2.0 21 1.9
Unit labor costs (per unit) $5.04 $5.07 $5.32 $4.77 $5.46
‘'*** did not provide employment data.
Source: Compiled from data submitted in response to Commission questionnaires.

Table Ill-8
Hand truck parts: Reported U.S. production capacity, production, and capacity utilization, 2001-
03, January-June 2003, and January-June 2004

* * * * * * *

Table III-9
Hand truck parts: U.S. producers’ shipments, by type, 2001-03, January-June 2003, and January-
June 2004

Table II-10
Hand truck parts: U.S. producers’ imports and purchases, 2001-03, January-June 2003, and
January-June 2004

Table IIl-11
Hand truck parts: U.S. producers’ end-of-period inventories, 2001-03, January-June 2003, and
January-June 2004

Table IIl-12
Hand trucks and parts: U.S. producers’ shipments, by type, 2001-03, January-June 2003, and
January-June 2004




Table VI-1
Hand trucks: Results of operations of U.S. producers, fiscal years ended 2001-03, January-June
2003, and January-June 2004

Fiscal years ended:* January-June
Item 2001 2002 2003 2003 2004
Quantity (units)
Total sales 1,491,823 | 1,447,356 | 1,493,478 779,186 722,304
Value ($1,000)
Total sales 53,658 52,831 53,400 27,818 25,907
Cost of goods sold:
Raw material 24,676 24,223 26,610 13,869 13,151
Direct labor 4,924 5,145 5,111 2,654 2,392
Other factory costs 10,462 10,401 10,707 5,188 4,801
Total cost of goods sold 40,063 39,770 42,428 21,711 20,344
Gross profit 13,595 13,061 10,972 6,106 5,563
SG&A expenses 7,124 7,296 7,438 3,581 3,562
Operating income 6,471 5,765 3,534 2,525 2,002
Interest expense 351 298 263 112 61
Other expense 19 87 26 12 11
Other income items 55 32 8 9 17
Net income 6,157 5,412 3,253 2,410 1,946
Depreciation/amortization 1,166 1,041 960 465 431
Cash flow? 7,323 6,453 4,213 2,874 2,377
Ratio to total net sales (percent)
Raw material 46.0 45.9 49.8 49.9 50.8
Direct labor 9.2 9.7 9.6 9.5 9.2
Other factory costs 19.5 19.7 20.1 18.7 18.5
Total cost of goods sold 74.7 75.3 79.5 78.0 78.5
Gross profit 25.3 24.7 20.5 22.0 21.5
SG&A expenses 13.3 13.8 13.9 12.9 13.7
Operating income 12.1 10.9 6.6 9.1 7.7
Table continued on next page.

VI-2


5. Industry condition and vulnerability

In considering whether the domestic industry is threatened with material injury, we have also
examined the condition of the industry over the period examined. Key trade indicators were stable from
2001 to 2003, but generally lower in interim 2004 as compared to interim 2003. The domestic industry’s
production, capacity and capacity utilization with respect to production of finished hand trucks were
generally stable from 2001 to 2003.' However, in interim 2004 these indicators generally declined.!”
Domestic industry shipments of finished hand trucks and parts measured by value were generally stable
throughout the period examined, but they were lower by *** percent in interim 2004 as compared to
interim 2003.'* Sales measured by value followed similar trends.’ The domestic industry continued to
lose market share (by value) in interim 2004. In that period the industry’s market share was ***
percentage points lower than in interim 2003. The domestic industry held *** percent of the U.S. market
for hand trucks and hand truck parts in 2001, but only *** percent of the market in interim 2004.'” The
industry’s employment indicators were steady to somewhat positive over the period examined.'”!

The domestic industry’s operating profitability declined steadily over the period examined,
although the industry remained profitable. Operating income declined from $*** in 2001 to $*** in
2002, and further declined to $*** in 2003. Operating income decreased by *** percent between 2002

‘6 Domestic production capacity for producing finished hand trucks was 2.40 million hand trucks in 2001, 2.40
million hand trucks in 2002 and 2.41 million hand trucks in 2003. Domestic production of finished hand trucks was
1.46 million hand trucks in 2001, and 1.50 million in 2002 and 2003. Domestic capacity utilization increased
irregularly from 60.9 percent in 2001, to 62.3 percent in 2002 before decreasing to 61.9 percent in 2003. CR/PR at
Table III-3. Domestic production of hand truck parts is relatively small in quantity compared to finished hand
trucks. In 2003, the domestic industry produced *** components, *** kits, and 1.5 million finished hand trucks.
CR/PR at Tables III-6 and III-8. Therefore, although we recognize that production of components and unassembled
kits increased over the period examined, while capacity was stable, and capacity utilization increased, we focus our
analysis on the trade data for finished hand trucks which are many times larger than the trade data for hand truck
parts. CR/PR at Table III-8. None of the parties has argued to the contrary.

‘7 Domestic production of finished hand trucks was 9.8 percent lower in interim 2004 than in interim 2003. It
was 736,204 hand trucks in interim 2004 as compared to 816,444 hand trucks in interim 2003. Although the
domestic industry’s capacity to produce finished hand trucks was 9.3 percent higher in interim 2004 as compared to
interim 2003, its capacity utilization was 11.8 percentage points lower. Domestic industry capacity was 1.3 million
hand trucks in interim 2004, as compared to 1.2 million hand trucks in interim 2003. The domestic industry’s
capacity utilization rate was 55.7 percent in interim 2004 as compared to 67.6 percent in interim 2003. CR at III-3-
4; PR at III-1-2 & CR/PR at Table III-3.

‘68 Domestic producer shipments of hand trucks and hand truck parts measured by value were $*** in 2001, $***
in 2002 and $*** in 2003. Domestic producer shipments of the domestic product were $*** in interim 2004 as
compared to $*** in interim 2003. CR/PR at Table III-12, Table C-3.

We note that the value of domestic producers’ finished hand truck shipments is many times larger than
comparable data for hand truck parts. In 2003, the value of domestic shipments of finished hand trucks was $53.4
million whereas the value of finished hand truck parts (components and kits combined) was $***.

1® Net sales by value were $*** in 2001, and $*** in 2002 and 2003. They were $*** in interim 2004 as
compared to $*** in interim 2003. CR/PR at Table C-3.

17° CR/PR at Table C-3.

'TM The number of production workers, the hours worked, and the wages paid with respect to finished hand trucks
all increased from 2001 to 2003. The number of production workers was lower in interim 2004 than in interim 2003,
but hours worked and wages paid were higher. Worker productivity with respect to finished hand truck production
was steady from 2001 to 2003, then declined between interim periods. CR/PR at Table III-7.

24


60982

Federal Register/Vol. 69, No. 198/Thursday, October 14, 2004/ Notices

evidence on the record indicates an
absence of government control, both in
law and in fact, over the export
activities of Huatian, Taifa, True
Potential, Xinghua, Future Tool, and
Shandong. For a complete discussion of
the Department's determination that the
respondents are entitled to separate
rates, see Preliminary Determination, 69
FR at 29511.

Margins for Cooperative Exporters Not
Selected

For our final determination,
consistent with our Preliminary
Determination, we have calculated a
weighted-average margin for Future
Tool and Shandong based on the rates
calculated for those exporters that were
selected to respond in this investigation,
excluding any rates that are zero, de
minimis or based entirely on adverse
facts available. See Preliminary
Determination, 69 FR at 29512.
Companies receiving this rate are
identified by name in the “Continuation
of Suspension of Liquidation” section of
this notice.

Surrogate Country

For purposes of the final
determination, we continue to find that
India is the appropriate primary
surrogate country for the PRC. For
further discussion and analysis
regarding the surrogate country
selection for the PRC, see Preliminary
Determination, 69 FR at 29515.

Use of Facts Otherwise Available

Sections 776(a)(2)(A), (B), (C), and (D)
of the Act provide that the Department
shall use facts available when a party
withholds information that has been
requested by the administering
authority under this subtitle; does not
provide the Department with
information by the established deadline
or in the form and manner requested by
the Department; significantly impedes a
proceedig; or provides such
information but the information cannot
be verified. In addition, section 776(b)
of the Act provides that, if the
Department finds that an interested
party “has failed to cooperate by not
acting to the best of its ability to comply
with a request for information,” the
Department may use information that is
adverse to the interests of that party as
facts otherwise available in selecting
from among the facts available. Such
adverse inference may include reliance
on information derived from: (1) The
petition; (2) a final determination in the
investigation under this title; (3) any
previous review under section 751 or
determination under 753; or (4) any

other information placed on the record.
See 19 CFR 351.308(c).

On the basis of our findings in this
investigation, which are detailed below,
we have determined that the use of facts
otherwise available is appropriate for
the PRC-wide entity, Taifa and Xinghua
because they have not provided certain
information in the form or manner
requested.

The PRC-Wide Rate

As explained in the Department's
Preliminary Determination, there are
numerous producers/exporters of the
subject merchandise in the PRC. See
Preliminary Determination, 69 FR at
29513. As noted in the Preliminary
Determination, all exporters were given
the opportunity to respond to the
Department's questionnaire. Based upon
our knowledge of the PRC and the fact
that U.S. import statistics show that the
responding companies did not account
for all imports into the United States
from the PRC, we have determined that
certain PRC exporters of hand trucks
failed to respond to our questionnaire.
Because we did not receive data needed
to calculate a margin for those
companies, which we are treating as the
PRG-wide entity, we are continuing to
use facts available pursuant to Section
776(a) of the Act for our final
determination.

Moreover, we continue to find that
because the exporters comprising the
PRC-wide entity failed to respond to our
requests for information, they have
failed to cooperate to the best of their
ability. See Preliminary Determination,
69 FR at 29515. Accordingly, the
Department will apply an adverse
inference in selecting among the facts
available. See Section 776(b) of the Act.

As adverse facts available, we are
assigning as the PRC-wide rate the
higher of: (1) The highest margin listed
in the notice of initiation; or (2) the
margin calculated for any respondent in
this investigation. See, e.g., Final
Determination of Sales at Less Than
Fair Value: Certain Cold-Rolled Flat-
Rolled Carbon Quality Steel Products
From The People's Republic of China,
65 FR 34660 (May 31, 2000), and
accompanying Decision Memorandum
at Comment 1. For purposes of the final
determination of this investigation, we
have further updated information used
to corroborate the margin stated in the
petition. The corroborated margin from.
the petition is now 386.75 percent. See
Memorandum from John Brinkmann to
the File dated October 6, 2004,
regarding calculation of the adverse
facts available margin.

Taifa

In the Preliminary Determination, we
calculated a margin for Taifa in which
we applied partial facts available in our
calculation of normal value because of
inconsistencies between the reported
weights for completed hand trucks and
parts, and the reported inputs used to
produce the hand trucks and parts. See
Preliminary Determination, 69 FR at
29514. Subsequent to the Preliminary
Determination, we conducted
verification of Taifa’s questionnaire
responses. On the last day of
verification, Taifa reported an error in
its allocation formula for certain inputs,
which had not been included in Taifa’s
list of minor error corrections presented
at the beginning of the verification.
Because of problems with its allocation
formula, Taifa was unable to present the
Department with final input amounts
for the FOP data fields affected by the
allocation formula. See Qingdao Taifa
Group Co. Ltd. Verification Report,
September 3, 2004 (“Taifa Verification
Report”) at 17.

On July 30, 2004, Taifa submitted its
revised U.S. sales and FOP response
which included updated data reflecting
its minor corrections and revised data
for the allocated inputs, which Taifa
claimed was based on the corrected
allocation formula. As explained above
in the “Case History” section, the
Department solicited comments from
the parties on whether the revised data
for allocated inputs should be
considered unsolicited, new factual
information,

Upon review of Taifa’s July 30, 2004,
submission and the parties’ comments,
we have determined that the revised
values for the allocated inputs
constitute unsolicited, new factual
information. Although Taifa informed
the Department at verification that the
per-unit amounts of the reported
allocated inputs had been miscalculated
due to an error in the allocation
formula, Taifa was not able to provide
corrected data at the time of verification.
As the Department stated in the
verification report: “* * *because of
inaccuracies in the data for the allocated
inputs in the electronic spreadsheets
provided by Taifa, we were unable to
verify the allocation of these inputs into
the second and third level spreadsheets,
and the reported per-unit consumption
of these inputs for any of the selected
models.” See Taifa Verification Report
at 18. Because the Department did not
verify this correction, it did not request
that Taifa provide the corrected
allocated input data after verification.

Taifa has argued that it is incumbent
upon che Department to accept the


B. Product Description

Commerce’s final determinations defined the imported merchandise within the scope of these
investigations as follows:

The product covered consists of hand trucks manufactured from any material, whether
assembled or unassembled, complete or incomplete, suitable for any use, and certain
parts thereof, namely the vertical frame, the handling area and the projecting edges or toe
plate, and any combination thereof.

A complete or fully assembled hand truck is a hand-propelled barrow consisting of a
vertically disposed frame having a handle or more than one handle at or near the upper
section of the vertical frame; at least two wheels at or near the lower section of the
vertical frame; and a horizontal projecting edge or edges, or toe plate, perpendicular or
angled to the vertical frame, at or near the lower section of the vertical frame. The
projecting edge or edges, or toe plate, slides under a load for purposes of lifting and/or
moving the load.

That the vertical frame can be converted from a vertical setting to a horizontal setting,
then operated in that horizontal setting as a platform, is not a basis for exclusion of the
hand truck from the scope of this petition. That the vertical frame, handling area,
wheels, projecting edges or other parts of the hand truck can be collapsed or folded is not
a basis for exclusion of the hand truck from the scope of the petition. That other wheels
may be connected to the vertical frame, handling area, projecting edges, or other parts of
the hand truck, in addition to the two or more wheels located at or near the lower section
of the vertical frame, is not a basis for exclusion of the hand truck from the scope of the
petition. Finally, that the hand truck may exhibit physical characteristics in addition to
the vertical frame, the handling area, the projecting edges or toe plate, and the two
wheels at or near the lower section of the vertical frame, is not a basis for exclusion of
the hand truck from the scope of the petition.

Examples of names commonly used to reference hand trucks are hand truck, convertible
hand truck, appliance hand truck, cylinder hand truck, bag truck, dolly, or hand trolley.
They are typically imported under heading 8716.80.50.10 of the Harmonized Tariff
Schedule of the United States ("HTSUS"), although they may also be imported under
heading 8716.80.50.90. Specific parts of a hand truck, namely the vertical frame, the
handling area and the projecting edges or toe plate, or any combination thereof, are
typically imported under heading 8716.90.50.60 of the HTSUS. Although the HTSUS
subheadings are provided for convenience and customs purposes, the Department [of
Commerce]’s written description of the scope is dispositive.

Excluded from the scope are small two-wheel or four-wheel utility carts specifically
designed for carrying loads like personal bags or luggage in which the frame is made
from telescoping tubular material measuring less than 5/8 inch in diameter; hand trucks
that use motorized operations either to move the hand truck from one location to the next
or to assist in the lifting of items placed on the hand truck; vertical carriers designed

3(._.continued)
classes or kinds).


Table VI-1--Continued
Hand trucks: Results of operations of U.S. producers, fiscal years ended 2001-03, January-June
2003, and January-June 2004

Fiscal years ended:* January-June
Item 2001 2002 2003 2003 2004
Value (dollars per unit)
Total sales 35.97 36.50 35.76 35.70 35.87
Cost of goods sold:
Raw material 16.54 16.74 17.82 17.80 18.21
Direct labor 3.30 3.55 3.42 3.41 3.31
Other factory costs 7.01 7.19 TA7 6.66 6.65
Total cost of goods sold 26.85 27.48 28.41 27.86 28.17
Gross profit 9.11 9.02 7.35 7.84 7.70
SG&A expenses 4.78 5.04 4.98 4.60 4.93
Operating income 4.34 3.98 2.37 3.24 2.77
Number of firms reporting
Data 8 8 8 8
Operating losses 2 2 3 2

‘Includes data from companies that have fiscal years that end December 31 of the year indicated or that have
fiscal years that predominantly fall within the year indicated.
? Cash flow is likely somewhat understated due to ***.

Source: Compiled from data submitted in response to Commission questionnaires.

Table VI-2
Hand trucks: Results of operations of U.S. producers, by firms, fiscal years ended 2001-03,
January-June 2003, and January-June 2004

* * * * * * *

variances in each full-year period-to-period comparison. The small positive price variance for interim
2003-04 was offset by higher period-to-period raw material and other factory costs.*

The Commission’s preliminary views in this investigation noted that the hand truck industry,
despite operating at very low levels of capacity utilization, was profitable throughout the period for
which data were collected.” Based on the data as initially reported, the same pattern, ***, was present in
the final phase of this investigation.

8 ee

° See “Views of the Commission” in Hand Trucks and Certain Parts Thereof from China, Investigation No. 731-
TA-1059 (Preliminary), Publication No. 3660, January 2004, p. 18, fn. 66.

VI-3


PART VII: THREAT CONSIDERATIONS

The Commission analyzes a number of factors in making threat determinations (see 19 U.S.C. §
1677(7)(F)(i)). Information on the volume and pricing of imports of the subject merchandise is presented
in parts IV and V; and information on the effects of imports of the subject merchandise on U.S. producers
existing development and production efforts is presented in part VI. Information on inventories of the
subject merchandise; foreign producers’ operations, including the potential for “product-shifting;” any
other threat indicators, if applicable; and any dumping in third-country markets, follows.

THE INDUSTRY IN CHINA

In the final phase of this investigation, five Chinese producers of hand trucks provided responses
to the Commission’s request for information. The firms that responded are Qingdao Taifa Group Co.
(Taifa), Qingdao Huatian Hand Truck Co. (Huatian), Jiaonan Tianhe Hand Truck Co. (Tianhe), Qingdao
Xinghua Group (Xinghua), and Qingdao Zhenhua Industrial Group (Zhenhua).' The responding Chinese
producers are based in the coastal city of Jiaonan, an economic and technology development zone.’ The
largest producer of hand trucks in China, Taifa, produces both steel and aluminum hand trucks and
reportedly accounts for about one third of all hand truck production.’ Only Taifa and Huatian reported
parts production and exports to the United States. Respondents reported that there are about 20 to 30
companies that export hand trucks from China to the United States.*

Table VII-1 presents responding firms’ production of other products on equipment and machinery
used in the production of hand trucks and parts, share of hand trucks and parts production on the same
equipment, and shares of reported sales of hand trucks and parts, as a percentage of their total sales.
Aggregate Chinese hand truck and parts production capacity, production quantity, shipments, and
inventory data supplied by the responding firms are presented in table VII-2 and table VII-3. Only one
firm, ***, indicated that it intends to curtail production. Commerce’s public verification report on Taifa,
however, indicates that Taifa’s last production runs were in February and March 2004.° °

Table VII-1

Hand trucks and parts: Chinese producers, production of other products on equipment and machinery used
in the production of hand trucks and parts, shares of hand truck production on the same equipment, and
share of firms’ total sales represented by sales of hand trucks and parts, 2003

* * * * * * *

' Staff attempted to e-mail or fax the foreign producer questionnaire to other producers of hand trucks in China.
*** imports hand trucks from ***.

? The Government of Jiaonan’s website indicates that the city has eight hand truck manufacturers, including four
industrial enterprises (identified as Xinghua Group, Taifa Group, Zhenhua Industrial Group, and Huatian Hand
Truck Company), and four village-owned, individual, or private manufacturers.

> Hearing transcript, p. 213 (Feng). Taifa reportedly is also the largest manufacturer of pushing carts in China,
specializing in wheelbarrows, go-carts, garden carts, hand trucks, tires, and castors. Hearing transcript, p. 167
(Feng).

* Hearing transcript, p. 172 (Liu).

5 Qingdao Taifa Group Co., Ltd. Verification Report, September 2, 2004, p. 12 (appearing in Gleason’s
posthearing brief, exh. 6).

° The responding firms’ January-March 2004 production of hand trucks and exports to the United States were
450,000 and ***, respectively. The firms’ April-June 2004 production and exports to the United States were
220,000 and ***, respectively.

VIl-1


UNITED STATES INTERNATIONAL TRADE COMMISSION

Investigation No. 731-TA-1059 (Final)

HAND TRUCKS AND CERTAIN PARTS THEREOF FROM CHINA

DETERMINATION

On the basis of the record' developed in the subject investigation, the United States International
Trade Commission (Commission) determines, pursuant to section 735(b) of the Tariff Act of 1930 (19
U.S.C. § 1673d(b)) (the Act), that an industry in the United States is threatened with material injury by
reason of imports from China of hand trucks and certain parts thereof, provided for in subheadings
8716.80.50 and 8716.90.50 of the Harmonized Tariff Schedule of the United States, that have been found
by the Department of Commerce (Commerce) to be sold in the United States at less than fair value
(LTFV). The Commission further determines that it would not have found material injury but for the
suspension of liquidation.

BACKGROUND

The Commission instituted this investigation effective November 13, 2003, following receipt of a
petition filed with the Commission and Commerce by Gleason Industrial Products, Inc., Los Angeles,
CA. The final phase of the investigation was scheduled by the Commission following notification of a
preliminary determination by Commerce that imports of hand trucks and certain parts thereof from China
were being sold at LTFV within the meaning of section 733(b) of the Act (19 U.S.C. § 1673b(b)). Notice
of the scheduling of the final phase of the Commission’s investigation 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
of June 8, 2004 (69 F.R. 32042). The hearing was held in Washington, DC, on October 7, 2004, and all
persons who requested the opportunity were permitted to appear in person or by counsel.

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


Table D-1
Hand trucks: Weighted-average values per unit of products 1, 2, 3, and 4 and quantities of imports

by importers that sell to retail customers and other end-use customers, by quarters, January 2001-
June 2004

D-3


Table VI-8

Number of firms, sales, operating income, assets, and return on investment (RO!) on operations for NAICS
333924 (industrial truck, tractor, trailer, and stacker machinery manufacturing) for 5 one-year periods ending
March 31, 1999 to March 31, 2003

Period Number of Sales value Asset value orerin 3 Asset ta ROI?
companies ($1,000) ($1,000) (percent) turnover’? | (percent)
4/1/98 - 3/31/99 45 1,745,258 921,284 (242.6) 1.9 (459.6)
4/1/99 - 3/31/00 37 1,181,881 883,861 43 1.3 5.8
4/1/00 - 3/31/01 36 1,394,796 808,795 41 1.7 7.1
4/1101 - 3/31/02 26 759,621 432,942 2.1 1.8 3.7
4/1102 - 3/31/03 57 1,706,237 1,080,309 27 1.7 45

‘ Asset turnover is the ratio of sales to total assets.
? Asset turnover and ROI were calculated using RMA data.

Source: © “2004” by RMA- The Risk Management Association. All rights reserved. No part of this table may be
reproduced or utilized in any form or by any means, electronic or mechanical, including photocopying, recording or
by any information storage and retrieval system without permission in writing from RMA- The Risk Management
Association. Please refer to www.rmahg.org for further warranty, copyright and use of data information.

CAPITAL AND INVESTMENT

The Commission requested U.S. producers to describe any actual or potential negative effects of
imports of hand trucks from China on their firms’ growth, investment, and ability to raise capital or
development and production efforts (including efforts to develop a derivative or more advanced version
of the product). Their responses are reported in appendix F.

VI-7


Table C-4
Finished hand trucks: Summary data conceming the U.S. market, 2001.03, January-June 2003, and January-June 2004

(Quantity=units, vaiu

(000 dollars, unit values, unit labor costs, and unit expenses are per unt; period changes=percent, except where noted)

~ __ Reported data . Period changes
_ January-June Jan-June
Item 2001 2002 2003 72003 2004 2001-03 2001-02 2002.03, 2003-04

US. consumption quantity:

‘Amount... sos 2,182,933 2.494644 2,879,565 1,476,579 1,490,942 319 143 154 10
Producers share (1)... ---» 673 574 509 B17 483 “163 -102 62 34
Importers’ share (1):
China ce 298 378 488 458 455 170 78 92 03
Allother sources... 29 53 23, 25 8 068 24 30 36
Totalimports....... 327 29 49.41 783 Bi 163 402 62 34
US. consumption value:
“Amount... an 67,662 72697 73820 40,493, 4,770 165 74 a4 32
Producers’ share (1)....----» 798 73.4 678 685 634 “120 “7 53 54
Importers’ share (1):
China... . 142 204 2A 259 325 129 62 67 68
Allother sources... 60 65 $4 56 45 a9 0s 13 12
Total imports . 202 26.9 322 315 36.9 120 67 53 54
US. imports from (2)
China:
Quantity... eee 650,172 937,851 1,348,305 «675,556 «678,309 107.4 442 438 04
Value fe 9622 14839 21,366 10,480 13,562 1224 542 449 208
a $1480 $15.82 $1587 $1551 $19.99 72 69 03 289
Ending inventory quantly.... 120,735 «115821 «223.477 148,779 «418,740 854 “a4 930 1e15
Allother sources:
Quantity aa 63912 131,700 66,251 37.649 92,337 37 106.1 497 1453
Value fie 4,052 Art2 4,087 2278 1,862 01 163 “144 “182
Unit value... : $63.40 $35.78 $61.09 $60.48 $20.17 368 43.6 707 666
Ending inventory quantity... ” ~ - - “ - “ ~ ”
Al sources:
Quantity . 714084 1,069,551 1.412.556 713208 «=(770,646 978 498 324 a1
Value... a 13873 10551 25.413 12,757 18.424 859 430 300 209
Unit value... eee $19.15 $18.28 $17.99 $1789 $2001 60 45 18 19
Ending inventory quantiy ” oo - ~ ” “ oo “ “
US. producers:
‘Average capacity quantity 2403689 2,401,915 2,413,768 © 1,208,406 1,920,557 04 4 05 93
Production quanity co -1,463,682 1495514 1.495311 816,444 738,208 22 22 09 98
Capacity utiization (1) 609 623 619 678 557 4 14 03 18
US. shipments:
‘Quantity an 1,468,849 1,425,093 1,467,009 763.374 720,206, on 30 29 $68
Value : 53,989 53,148 59,407 20737 28,345 4 418 05 50
Unit value... : $36.76 $97.29 $96.44 $36.33 $96.58 40 15 24 07
Export shipments:
‘Guonty . ~~ . os “ - ~ ~
Veo ~ ~~ “ ~ as ~ a o
Unit value... : ~ ” - ” ” ”
Ending inventory quant “ “ - ” “ Sad ” - ”
Invent shipment) ” - ” ” “ ” “ “
Production workers... .. 358 370 amt ur 35 33 03 57
Hours worked (1,008)... 695 726 728 374 42 44 02 06
Wages paid ($1,005)... .. 7,134 7,345 7721 3.797 82 30 sy 23
Hourly wages... $1028 $10.12 $10.66 $10.15 39 a4 53 17
Productivity unitsMour)..... 20 20 20 24 15 19 04 arr
Unit labor costs... $504 $5.07 $5.92 S477 55 05 49 143
Net sales:
1,491,823 1,447,956 1,493,478 779,186 722,304 o1 20 32 73
: 59,658 52,831 53,400 27.818 25,907 05 AS 14 69
Unit value... $36.97 $36.50 $35.76 $3570 $35.87 06 15 20 08
Cost of goods sold (COGS) . 40,063 39,770 42,428 arn 20344 59 07 67 63
Gross proft or (oss). 13,595 13,061 10,972 6,108 5,563 133 39 “160 89
SGBA expenses... 7,124 7,296 7,438 3.581 3,562 44 24 19 08
Operating income or (oss). e471 5,765 3.534 2.825 2,002 45.4 109 987 207
Capital expenditures ” ” ” . ” ” - ”
Unit COGS $26.85 $27.48 $28.41 327.86 $28.17 58 23 34 14
Unit SG8A expenses $478 $5.04 $4.98 $460 $4.93 43 56 12 73
Unit operating income or (oss) $4.34 $3.98 $237 $3.24 8277 45.4 82 408 145
CoGsisales (1)...... 747 753 795 789 785 48 06 42 05
Operating income or (ess
00S (1) oe eeeeeeeee 124 109 66 on 7 54 a4 43 13

(1) "Reported data” are in percent and “period changes” are in percentage points,
(2) Please refer to footnote 3, page IV-1, for additional details on import data.

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.

‘Source: Compiled from data submitted in response to Commission questionnaires and from official Commerce statistics.

c3


Federal Register/Vol. 69, No. 198/Thursday, October 14, 2004/Notices

DEPARTMENT OF COMMERCE

International Trade Administration
[A-570-891)

Notice of Final Determination of Sales
at Less Than Fair Value: Hand Trucks
and Certain Parts Thereof from the
People’s Republic of China

AGENCY: [mport Administration,
International Trade Administration,
Department of Commerce.

EFFECTIVE DATE: October 14, 2004.

FOR FURTHER INFORMATION CONTACT:
Daniel J. Alexy, Stephen Cho, or Audrey
Twyman, Import Administration,
International Trade Administration,
U.S. Department of Commerce, 14th
Street and Constitution Avenue, NW.,
Washington, DC 20230; telephone: (202)
482-1540, (202) 482-3798, or (202) 482—
3534, respectively

Final Determination

We determine that hand trucks and
certain parts thereof (“hand trucks”)
from the People's Republic of China
(“PRC”) are being sold, or are likely to
be sold, in the United States at less than.
fair value (“LTFV”), as provided in
section 735 of the Tariff Act of 1930, as
amended (the “Act’”). The estimated
margins of sales at LTFV are shown in
the “Continuation of Suspension of
Liquidation” section of this notice.

Case History

The preliminary determination in this
investigation was issued on May 17,
2004. See Notice of Preliminary
Determination of Sales at Less Than
Fair Value and Postponement of Final

Determination: Hand Trucks and
Certain Parts Thereof From the People’s
Republic of China, 69 FR 29509 (May
24, 2004) (“Preliminary
Determination”).

Since the Preliminary Determination,
the following events have occurred. In
May of 2004, the Department of
Commerce (“the Department”) sent out
supplemental questionnaires to Qingdao
Huatian Hand Truck Co., Ltd.
(“Huatian”), Qingdao Taifa Group Co.,
Ltd. (“Taifa”), Qingdao Xinghua Group
Co., Ltd. (“Xinghua”), and True
Potential Company (‘True Potential”).
In June of 2004, the Department
received responses from these four
mandatory respondents participating in
this investigation. From July 8 through
15, 2004, we conducted verification of
the questionnaire responses of Huatian.
On July 16 and 19, 2004, we conducted
True Potential’s verification. From July
19 thi ough 23, 2004, we conducted
Taifa’s verification, and from July 26
through 30, 2004, we conducted
Xinghua’s verification.

On July 30, 2004, Huatian and Taifa
submitted revised U.S. sales and factors
of production (“FOP”) databases
incorporating minor error corrections
reported to the Department at the
opening of each company’s verification.
Taifa’s July 30, 2004, submission
contained corrections related to the so-
called “‘allocated inputs” in addition to
its minor error corrections. On
September 3, 2004, the Department
rejected Taifa’s July 30, 2004,
submission, on the grounds that the
additional corrections were unsolicited
new factual information. See the
Department's September 3, 2004, Letter
to Taifa. The Department requested that
Taifa remove the additional corrections,
and resubmit its FOP database without
the new factual information.

Ina September 8, 2004, meeting with
Department officials, Taifa’s counsel
argued that Taifa’s July 30, 2004,
submission did not contain any new
factual information. See Memorandum
to File; Re: Ex-parte Meeting-Qingdao
Taifa Group Co. Ltd, September 8, 2004.
On September 9, 2004, the Department
requested Taifa to resubmit its July 30,
2004, submission, and further invited
all parties to comment on whether the
additional corrections contained in
Taifa’s July 30, 2004, submission should
be considered new factual information.
See Memorandum to File; Re: Briefing
Schedule-Rejection of Taifa’s July 30,
2004 Submission, September 9, 2004.
On September 13, 2004, we received
comments from Taifa. On September 15,
2004, the petitioners (Gleason Industrial
Products, Inc. and Precision Products,


Table IV-1

Finished hand trucks: U.S. imports, by sources, 2001-03, January-June 2003, and January-June 2004

Calendar year January-June
Source 2001 2002 2003 2003 2004
Quantity (units)

China 650,172 937,851 1,346,305 675,556 678,309

Other sources 63,912 131,700 66,251 37,649 92,337
Total 714,084 1,069,551 1,412,556 713,205 770,646

Value (1,000 dollars)'

China 9,622 14,839 21,366 10,480 13,562

Other sources 4,052 4,712 4,047 2,276 1,862
Total 13,673 19,551 25,413 12,757 15,424

Unit value (per unif)'

China $14.80 $15.82 $15.87 $15.51 $19.99

Other sources 63.40 35.78 61.09 60.46 20.17
Average 19.15 18.28 17.99 17.89 20.01

Share of quantity (percent)

China 91.0 87.7 95.3 94.7 88.0

Other sources 9.0 12.3 47 5.3 12.0
Total 100.0 100.0 100.0 100.0 100.0

Share of value (percent)

China 70.4 75.9 84.41 82.2 87.9

Other sources 29.6 24.1 15.9 17.8 12.1
Total 100.0 100.0 100.0 100.0 100.0

* Landed, duty-paid.
Note.—Because of rounding, figures may not add to the totals shown.
Source: Compiled from official Commerce statistics.

U.S. MARKET SHARES OF HAND TRUCKS

Market shares for hand trucks are presented in table IV-3. The quantity and value of the U.S.
producers’ market share decreased steadily during the period for which data were collected.

RATIO OF SUBJECT IMPORTS TO U.S. PRODUCTION OF HAND TRUCKS

Information concerning the ratio of subject imports to U.S. production of hand trucks is

presented in table [V-4. Imports from China were equivalent to 44.4 percent of U.S. production during
2001. This level increased to 90.0 percent during 2003 and reached 92.1 percent during January-June

2004.



Table Ill-4
Finished hand trucks: U.S. producers’ shipments, by type, 2001-03, January-June 2003, and January-June
2004

Calendar year January-June
Item 2001 2002 2003 2003 2004
Quantity (units)
Commercial shipments 1,468,849 | 1,425,093] 1,467,009 763,374 720,296
Internal consumption i) 0 0 0 i}
Transfers to related firms 0 0 it) te) 0
U.S. shipments 1,468,849] 1,425,093] 1,467,009 763,374 720,296
Export shipments + a + a
Total 1 a 1 ees prs

Value (1,000 dollars)

Commercial shipments 53,989 53,146 53,407 27,737 26,345
Internal consumption 0 10) 0 0 0
Transfers to related firms 0 0 0 0 0
U.S. shipments 53,989 53,146 53,407 27,737 26,345
Export shipments rs rs ary on vs
Total 7 oe pon ery

Unit value (per unif)
Commercial shipments $36.76 $37.29 $36.41 $36.33 $36.58

Internal consumption ~ - ~ ~ ~

Transfers to related firms - - - - ~

U.S. shipments 36.76 37.29 36.41 36.33 36.58
Export shipments ee ee a pars pore
Total + prs oe ee

Note.—Because of rounding, figures may not add to the totals shown.

Source: Compiled from data submitted in response to Commission questionnaires.

Table Ill-5
Finished hand trucks: U.S. producers’ imports and purchases, 2001-03, January-June 2003, and
January-June 2004

Table III-6
Finished hand trucks: U.S. producers’ end-of-period inventories, 2001-03, January-June 2003, and
January-June 2004

Til-4


purchasers, including *** have had quality problems with *** hand trucks, and that these quality
problems were a significant factor in their decision to switch to Chinese sources of hand trucks.”

We find that price is important in purchasing hand trucks, because purchasers find domestic
product and subject imports generally comparable with respect to other important purchasing factors.
Purchasers ranked price, quality, and availability as the most important factors in purchasing hand
trucks.” Purchasers ranked Chinese and domestic products as comparable in quality and availability, and
the Chinese product superior (lower) in price.”' A majority of both producers and importers familiar with
the issue reported that non-price differences between hand trucks were never or only sometimes
significant in their firm’s sales of hand trucks.” Several purchasers viewed the U.S. product as superior
in product consistency and quality, and none of the purchasers reported that the U.S. product was inferior
to subject imports in those categories, refuting LDI’s arguments that the quality of the domestic product
was inferior to the Chinese product.*> Moreover, ***94 **#* 95

Iv. THREAT OF MATERIAL INJURY BY REASON OF SUBJECT IMPORTS FROM
CHINA

Because it is the basis of our affirmative determination, in this section of these views we discuss
how the domestic industry is threatened with material injury by reason of subject imports. In doing so
we analyze data pertaining to the period examined (January 2001 through June 2004) as well as what is
likely to occur in the imminent future. We discuss our negative finding regarding present material injury
in the subsequent section.

A. General Legal Standards

Section 771(7)(F) of the Act directs the Commission to determine whether the U.S. industry is
threatened with material injury by reason of the subject imports by analyzing whether “further dumped or
subsidized imports are imminent and whether material injury by reason of imports would occur unless an
order is issued or a suspension agreement is accepted.”°° The Commission may not make such a
determination “on the basis of mere conjecture or supposition,” and considers the threat factors “as a
whole” in making its determination whether dumped or subsidized imports are imminent and whether
material injury by reason of subject imports would occur unless an order is issued.” In making our
determination, we consider all statutory threat factors that are relevant to this investigation.”*

* LDI Prehearing Brief at 3-4.

5° Revised CR at Table II-1, OINV Memorandum INV-BB-149 (October 29, 2004).

5 CR/PR at Table II-1. If a purchaser rates one product as superior to another with respect to lower price in
these comparisons, that means he considers that product to generally have a lower price than the other one. CR/PR
at Table II-1 & nl.

* CR/PR at Table II-4.

°3 CR/PR at Table II-5.

4 Chinese Respondents’ Posthearing Brief, ***.

°5 CR at V-28; PR at V-9.

°° 19 U.S.C. § 1677(7)(F)(ii).

719 U.S.C. § 1677(7)(F)(ii).

% 19 U.S.C. § 1677(7)(F)(i). These factors include: any existing unused production capacity or imminent,
substantial increase in production capacity in the exporting country; a significant rate of increase of the volume or

(continued...)

14


Table Il-1

Hand trucks: Ranking of factors used in purchasing decisions as reported by U.S. purchasers

Number of firms reporting
Factor Number one factor Number two factor Number three factor
Quality 1 4 1
Price 8 10 3
Availability 2 2 4
Other* 2 7 15

* Other factors include delivery time, extension of credit, freight terms, product consistency, reliability of
supply, and traditional supplier.

Source: Compiled from data submitted in response to Commission questionnaires.

Purchasers were also asked to rank the factors (shown in table II-2) in terms of importance in
purchasing decisions. Each purchaser was asked to indicate whether a factor was very important,
somewhat important, or not important. Averaging results indicates that the most important factors were
price, availability, reliability of supply, and product consistency.

Table II-2
Hand trucks: Importance of purchasing factors
Average importance Average importance
Factor score’ Factor score’
Price 2.9 Discounts offered 2.3
Availability 29 U.S. transportation costs 2.2
Product quality exceeds industry
Reliability of supply 2.9 standards 2.2
Product consistency 2.8 Packaging 24
Product quality meets
industry standards 27 Minimum quantity requirements 24
Delivery time 2.6 Technical support/service 1.9
Delivery terms 2.5 Product range 1.9
Extension of credit 18
‘3 = very important, 2 = somewhat important, 1 = not important.
Source: Compiled from data submitted in response to Commission questionnaires.

Comparisons of Domestic Products and Subject Imports

To determine whether U.S.-produced hand trucks can be used in the same applications as imports
from China, producers and importers were asked whether the product can “always,” “frequently,”
“sometimes,” or “never” be used interchangeably. A majority of the producers, importers, and
purchasers responding to the question reported that the products can always or frequently be used
interchangeably (table II-3). In addition to assessing the degree of interchangeability, some firms also
provided additional comments concerning interchangeability. One U.S. producer stated that the wheels
for hand trucks from China cannot be used interchangeably with wheels for hand trucks produced in the
United States. Another producer stated that in most cases the wheels are interchangeable, but that the

TI-5


ELASTICITY ESTIMATES

This section discusses elasticity estimates for hand trucks. Parties were encouraged to comment
on these estimates as an attachment to their prehearing briefs. Among the estimates discussed below, the
petitioners limited their comments to the elasticity of substitution, while the respondents did not
comment on any of the estimates.

U.S. Supply Elasticity'*

The domestic supply elasticity for hand trucks measures the sensitivity of the quantity supplied
by U.S. producers to changes in the U.S. market price of hand trucks. As noted earlier, this elasticity
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 hand trucks. Because of the low rates of capacity
utilization in the industry, it is likely that the supply elasticity is high. An estimate in the range of 5 to 10
appears to be reasonable.

U.S. Demand Elasticity

The U.S. demand elasticity for hand trucks measures the sensitivity of the overall quantity
demanded to a change in the U.S. market price of this product. This estimate depends on factors
discussed earlier such as the existence, availability, and commercial viability of substitute products.
Because of a lack of close substitutes the aggregate demand for hand trucks is likely to be fairly inelastic;
a range of -0.5 to -1.0 is suggested.

Substitution Elasticity

The elasticity of substitution depends upon the extent of product differentiation between the
domestic and imported products.'* Product differentiation depends upon such factors as product quality
and conditions of sale (availability, sales terms/discounts/promotions, etc.). Based on available
information, the elasticity of substitution between U.S.-produced hand trucks and imported hand trucks is
likely to be in the range of 3 to 5.

The petitioners stated in their prehearing brief that a substitution elasticity of 5 to 10 would be
more appropriate, since domestic products and imports from China are most commonly viewed as always
or frequently interchangeable by questionnaire respondents.'® The petitioners further added that there are
almost never any non-price differences between the U.S.-produced and Chinese-produced products.
However, the discussion earlier in this section indicates that some differences in quality and other
characteristics between the products were cited by questionnaire respondents. Therefore, an elasticity in
the range of 3 to 5 still appears to be correct. The respondents did not comment on this elasticity.

‘ A supply function is not defined in the case of a non-competitive market.

'S The substitution elasticity measures the responsiveness of the relative U.S. consumption levels of the subject
imports and the domestic 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.

'© Gleason prehearing brief, p. 16.

r-9


CAPITAL EXPENDITURES

Data on hand truck capital expenditures are shown in table VI-6.'° No U.S. producer reported
R&D expenses. Gleason’s capital expenditures, ***.'° Angelus reported a ***.

Table VI-6
Hand trucks: Capital expenditures fiscal years ended 2001-03, January-June 2003, and January-
June 2004

ASSETS AND RETURN ON INVESTMENT

The value of total net assets and return on investment is shown in table VI-7.'’ No previous hand
truck investigation has been conducted by the Commission. Comparative Risk Management Association
(RMA) financial information for North American Industry Classification System (NAICS) code 333924

is presented in table VI-8.'*
eK 19 20

Table VI-7
Hand trucks and certain hand truck parts: Consolidated value of assets and return on investment,
fiscal years ended 2001-03

* * * * * * *

15 oe
16 ee

" Table VI-7 presents return on investment which, in this case, is operating income divided by each period’s total
net asset balance. Interim 2003 and 2004 returns were annualized. Valley Craft did not report asset information.
Return on investment is based only on the financial results of those companies listed above that reported total net
assets.

'S NAICS code 333924 (SIC 3496, 3537, 3799) represents establishments primarily engaged in the manufacture
of industrial trucks, tractors, trailers, and stackers (i.e., truck-type) such as forklifts, pallet loaders and unloaders, and
portable loading docks. Since RMA does not identify respondents, the extent to which U.S. producers in these
investigations are reflected in the RMA data is unknown.

1° ***, telephone interview by USITC staff, September 10, 2004.

” In response to questions raised by Commissioner Pearson during the hearing in this investigation (hearing
transcript, pp. 144-145), petitioners provided additional comments regarding the return on investment analysis, as
well as an alternative methodology. Gleason posthearing brief, exh. 1, pp. 9-10; exh. 9.

VI-6


from China ***.*” *** imports are not as significant as its domestic production, and although it
experienced increased operating income in the annual periods examined, it is not clear that this was due
to any benefit from its importation of subject merchandise, which was significantly exceeded by its
domestic production. Given these facts, we do not exclude *** from the domestic industry.

*** accounted for *** of the reported 2003 finished hand truck production. Valley Craft is a
related party because it is wholly owned and controlled by LDI, an importer of subject merchandise.**
Although Valley Craft ***, its parent LDI has filed briefs and testified in opposition to the petition.”
Valley Craft does not appear to have received a financial benefit from its corporate relationship with an
importer. In fact, its financial performance measured either in terms of operating income or operating
margins ***.4° Accordingly, we do not exclude this producer from the domestic industry.

*** accounted for *** of reported 2003 domestic production of finished hand trucks, and is a
related party by virtue of having imported subject merchandise. *** supports the petition.*' Its subject
imports of finished hand trucks as a ratio to its domestic production increased from *** percent in 2001
to *** percent in 2003. This ratio was lower, *** percent, in interim 2004, as compared to *** percent
in interim 2003. *** stated that it imported finished hand trucks ***.** ***’s operating margins were
*** the industry average. Moreover, its operating income *** in the annual periods surveyed, *** in
interim 2004 than in interim 2003.** Given the decrease in its operating income, and its *** operating
margins, we do not exclude *** from the domestic industry even though its imports were substantial
relative to its domestic production.

Accordingly, we define the domestic industry to include all U.S. producers of hand trucks and
certain hand truck parts as defined in Commere’s scope of investigation.

Ill. | CONDITIONS OF COMPETITION”

Several conditions of competition are pertinent to our analysis in the final phase of this
investigation.

37 CR/PR at Table III-5, n.2.

*8 CR/PR at Table III-1 & n.6.

* CR/PR at IlI-1, Table III-1.

*° CR/PR at Table VI-2. *** experienced *** throughout the period examined, which was not the case for the
other domestic producers. Id.

* CR/PR at Table III-1.

* CR/PR at Table IlI-5.

* CR/PR at Table IlI-5, n.4.

“4 CR/PR at Table VI-2. *** average operating margin for all periods surveyed except interim 2003 was ***

percent. The average operating margin for the entire domestic industry, for the same period, was *** percent.
Calculated from CR/PR at Table VI-2, Table VI-5.

“5 CR/PR at Table VI-2.

46 We find that subject imports from China are not negligible. Subject imports from China were well above the
three percent statutory negligibility threshold for the 12 months prior to filing of the petition in November 2003,
because they constituted more than 87.7 percent of the quantity of all imports of finished hand trucks throughout
2002 and 2003, and were well above negligibility levels with respect to hand truck parts in those annual periods.
CR/PR at Table IV-1, Table-IV-5.


Table IIl-2

Hand trucks and parts: U.S. producers, production of other products on equipment and machinery used in
the production of hand trucks and parts, shares of hand trucks and parts production on the same
equipment, production of other products using the same production and related workers employed to
produce hand trucks, and shares of hand trucks and parts production using the same workers, 2003

* * * * * * *

Table III-3
Finished hand trucks: Reported U.S. production capacity, production, and capacity utilization, 2001-03,
January-June 2003, and January-June 2004

Calendar year January-June
Item 2001 2002 2003 2003 2004
Capacity (units)' 2,403,689] 2,401,915] 2,413,768 1,208,406 1,320,557
Production (units) 1,463,692 1,495,514 1,495,311 816,444 736,204
Capacity utilization (percent) 60.9 62.3 61.9 67.6 55.7
1*** did not report capacity, therefore staff conservatively estimated their capacity at their highest level of production.
Source: Compiled from data submitted in response to Commission questionnaires.

equipment, raw material supply and cost, sales volume, availability of qualified skilled laborers, machine
capacity, and number of orders received.

U.S. PRODUCERS? U.S. SHIPMENTS AND EXPORT SHIPMENTS OF HAND TRUCKS

Data on domestic producers’ shipments of finished hand trucks are presented in table III-4.
Commercial shipments accounted for 100 percent of U.S. shipments of finished hand trucks. The
quantity of commercial shipments decreased by 3.0 percent from 2001 to 2002, then increased by 2.9
percent in 2003, and was 5.6 percent lower in January-June 2004 than in January-June 2003. The unit
value of U.S. shipments increased by 1.5 percent from 2001 to 2002, decreased by 2.4 percent in 2003,
and was 0.7 percent higher in January-June 2004 than in January-June 2003. *** were the only U.S.
producers to report export shipments, which were made to ***.

U.S. PRODUCERS’ IMPORTS AND PURCHASES OF IMPORTS OF HAND TRUCKS

Table II-5 presents the U.S. producers’ direct imports and purchases of finished hand trucks.
Three U.S. producers, ***, reported that they imported hand trucks, and *** reported that it purchased
imports of hand trucks.

U.S. PRODUCERS’ INVENTORIES OF HAND TRUCKS

Data on end-of-period inventories of finished hand trucks are presented in table III-6. Five
producers reported inventories, ***. ***, in contrast, indicated that it only produces to order.

7 (...continued)
revised the remaining capacity to reflect ***. Staff views these revisions as reasonable, given Gleason’s actual
production record, but notes that Gleason believes its original calculations to be conservative. Gleason posthearing
brief, exh. 10.

Ti-3


CONTENTS

Page

Part IV: U.S. imports, apparent U.S. consumption, and market shares ..............00.00005 Iv-1
U.S. importers Iv-1
U.S. imports of hand trucks . Iv-l
Apparent U.S. consumption of hand trucks ......... 6.606 c eee cece cece eee eee Iv-1
U.S. market shares of hand trucks 2.0.0.0... 0.0 c cece e tee ce center eee Iv-2
Ratio of subject imports to U.S. production of hand trucks . Iv-2
USS. imports of parts 2.206.600 . v3
Apparent U.S. consumption of parts Iv-5
US. market shares of parts Iv-5
Ratio of subject imports to U.S. production of parts .. Iv-5
Apparent U.S. consumption of hand trucks and parts . IV-5

U.S. market shares of hand trucks and parts..... . Iv-5

Part V: Pricing and related information V-1
Factors affecting prices......... V-1
Raw material costs v-1
Transportation costs to the U.S. market ©... 2.0.6... c cect e cence eee e ene V-1

USS. inland transportation costs - Ved
Exchange rates 0... ccc e nee e een nee e eae V-1
Pricing practices 20.0... ccc eee eee teen eens V-1
Price data - V2
Price trends ©... 0... eee eee ccc eeen eee ene tet b eee eet n teens v-3

Price comparisons 2.0.2.0... cee ee nee n eee ene beeen eee V-7

Lost sales and lost revenues . . V-7
Part VI: Financial experience of U.S. producers VI-1
Background VI-1
Operations on hand trucks ...... VI-1
Operations on certain hand truck parts . VI-5
Combined operations on hand trucks and certain hand truck parts . : . VIS
Capital expenditures .... 00... cece eee eee eee : - VI-6
Assets and return on investment . VI-6
Capital and investment ...... . VI-7
Part VII: Threat considerations VII-1
The industry in China . . VI-1
USS. importers’ inventories ............. . VII-3
U.S. importers’ current orders for hand trucks ...... 0.2.02. 0 cece e cece eee eee eee VII-3

Dumping in third-country markets .. 2.2.2.2 VII-3

ii


Table V-12: Margins of underselling and (overselling) by channel of distribution

Range of Range of

Total Instances of | Instances of | underselling | overselling
Item comparisons | underselling | overselling margins margins
Product 1
Home improvement stores 13, 13 0 0.0 - 15.8 “
Hardware stores 14 10 4 4.5-42.8 | (2.1)- (12.7)
Catalog houses/industrial
supply distributors 14 14 0 38.5 - 63.3 o
Product 2
Home improvement stores 13 13 0 69.5 - 80.7 o
Hardware stores 14 14 0 29.6 - 56.3 “
Catalog houses/industrial
supply distributors 14 14 0 1.9 - 23.5 a
Product 3
Hardware stores 14 14 0 8.1 - 57.8 a
Catalog houses/industrial
supply distributors 11 11 0 68.6 - 72.1 o
Product 4
Hardware stores 1 0 1 a (75.5)
Catalog houses/industrial
supply distributors 14 11 3 0.3 - 27.8 (0.8) - (15.1)
* Not applicable.
Source: Compiled from data presented in tables V-1 through V-6 and V-8 through V-11.

Table V-13
Hand trucks: U.S. producers’ lost revenue allegations

* * * * * *

Table V-14
Hand trucks: U.S. producers’ lost sales allegations

* * * * * *

V-8



tended to either be stable or increase, with the exception of import prices for Product 4 sold to catalog
houses which fluctuated over a wide range.'

We find pricing movements have varied with no clear trend. In the higher-volume products 1
and 2, domestic prices have been generally stable with fluctuations within narrow ranges. Domestic
prices for product 3 have also been generally stable, with broader fluctuations in sales to hardware stores,
while prices for product 4 generally increased.'*' We do not find current evidence that subject imports
are depressing domestic prices, and we do not find it likely that such price depression will occur in the
imminent future.'*

We do find that subject imports are likely to have significant price-suppressing effects on
domestic prices, absent antidumping relief. The domestic industry’s cost of goods sold (“COGS”) as a
share of net sales increased from *** percent in 2001 to *** percent in 2002 and then jumped to ***
percent in 2003.'® It was *** percent in interim 2004 as compared to *** percent in interim 2003. Thus
the data already show some price suppressing effects of subject imports.

These negative price effects were most pronounced towards the end of the period examined,
when *** switched suppliers, and Home Depot began to phase out its purchases of domestic product. In
interim 2004, domestic sales and shipments were lower than in interim 2003.'** ***.'% We find that the
negative price-suppressing effects late in the period examined foreshadow much larger potential price-
suppressing effects of subject imports on domestic prices if the domestic industry permanently loses
Home Depot and Lowe’s as customers. In such a case, the industry would have to spread its fixed costs
over fewer sales. In a market environment without antidumping relief, the industry could not raise prices
on its remaining sales to compensate for the reduced volume. Thus the loss of sales volume would, in
effect, also translate into significant price suppression.

To summarize with respect to prices, we find that subject imports are entering at prices that are
likely to increase demand for further subject imports, which increase will, in turn, have significant price
suppressing effects on domestic prices.

'9(__ continued)
over the period examined, as did prices for subject imports. CR/PR at Table V-3. Domestic prices for Product 2 sold
to catalog houses/ industrial distributors increased, while subject import prices generally increased with some
fluctuations. CR/PR at Table V-6.

1 Product 3 is a specialized, steel appliance hand truck. Domestic prices for Product 3 sold to home
improvement stores were stable, with small variations. Import prices were limited but also reflected stable prices.
CR/PR at Table V-7. Domestic prices for Product 3 sold to hardware stores increased, while subject import prices
decreased. CR/PR at Table V-8. Domestic prices for Product 3 sold to catalog/industrial distributors were stable.
CR/PR at Table V-9.

Product 4 is an aluminum hand truck. Domestic prices for Product 4 sold to hardware stores increased.
Data on prices for subject imports were only available for two quarters, and therefore too limited for meaningful
price trend analysis. CR/PR at Table V-10. Domestic prices for Product 4 sold to catalog/industrial distributors
increased over the period surveyed, while import prices varied within a wide range. CR/PR at Table V-11.

16) CR/PR at Tables V-1-V-11; Figures V-1-V-11.

‘2 As mentioned above, producers in the hand truck industry are more likely to curtail production than to reduce
prices below profitable levels.

' CR/PR at Table VI-5, Table C-3.

tet #* CR at V-29; PR at V-9; Gleason Prehearing Brief, Exhibit 11.

‘5 CR at F-4, n.1; PR at F-3, nt.

23


Figure V-2
Hand trucks: Weighted-average f.o.b. prices of domestic and imported product 1 sold to hardware
stores, by quarters, January 2001-June 2004

* * * * * * *

Figure V-3

Hand trucks: Weighted-average f.0.b. prices of domestic and imported product 1 sold to catalog
houses/industrial supply distributors, and landed duty-paid value per unit of imports by firms that
sell that sell through catalogs, by quarters, January 2001-June 2004

* * * * * * *

Figure V-4

Hand trucks: Weighted-average f.o.b. prices of domestic and imported product 2 sold to home
improvement stores, and the landed duty-paid value per unit of imports by ***, by quarters,
January 2001-June 2004

Figure V-5
Hand trucks: Weighted-average f.o.b. prices of domestic and imported product 2 sold to hardware
stores, by quarters, January 2001-June 2004

* * * * * * *

Figure V-6

Hand trucks: Weighted-average f.0.b. prices of domestic and imported product 2 sold to catalog
houses/industrial supply distributors, and landed duty-paid values per unit of imports by firms
that sell through catalogs, by quarters, January 2001-June 2004

* * * * * * *
Figure V-7

Hand trucks: Weighted-average f.o.b. prices of domestic product 3 sold to home improvement
stores and landed duty-paid value per unit of imports by ***, by quarters, January 2001-June 2004

* * * * * * *

Figure V-8
Hand trucks: Weighted-average f.o.b. prices of domestic and imported product 3 sold to hardware
stores, by quarters, January 2001-June 2004

* * * * * * *

Figure V-9

Hand trucks: Weighted-average f.o.b. prices of domestic and imported product 3 sold to catalog
houses/industrial supply distributors and landed duty-paid value per unit of imports by firms that
sell that sell through catalogs, by quarters, January 2001-June 2004

* * * * * * *

V-6


Table IV-5
Hand truck parts: U.S. imports, by sources, 2001-03, January-June 2003, and January-June 2004

* * * * * * *

APPARENT U.S. CONSUMPTION OF PARTS

Data on apparent U.S. consumption of hand truck parts are presented in table IV-6.2 Apparent
U.S. consumption of hand truck components increased *** percent by quantity and *** percent by value
between 2001 and 2003, and was *** percent higher by quantity and *** percent higher by value in
January-June 2004 than in January-June 2003. Apparent U.S. consumption of unassembled hand trucks,
or kits, decreased *** percent by quantity and *** percent by value between 2001 and 2003, but was ***
percent higher by quantity and *** percent higher by value in January-June 2004 than in January-June
2003.

U.S. MARKET SHARES OF PARTS

Market shares for hand truck parts are presented in table IV-7.° The quantity and value of the
U.S. producers’ market share of components decreased during 2001-03. In contrast, the quantity and
value of the U.S. producers’ market share of kits increased during 2001-03. During January-June 2004,
the U.S. producers’ market share decreased for components but increased for unassembled kits compared
with January-June 2003.

RATIO OF SUBJECT IMPORTS TO U.S. PRODUCTION OF PARTS

Information concerning the ratio of subject imports to U.S. production of hand truck components
and unassembled kits is presented in table IV-8. The ratio of imports of hand truck components from
China to U.S. production increased steadily during the period for which data were collected. The ratio of
imports of unassembled kits from China to U.S. production decreased during 2001-03 but rose to its
highest level in January-June 2004.

APPARENT U.S. CONSUMPTION OF HAND TRUCKS AND PARTS

Data on apparent U.S. consumption of hand trucks and parts (combined) are presented in table
IV-9. Because the quantities of finished hand trucks and hand truck parts are measured in distinct units,
the apparent U.S. consumption presented is based exclusively on value data for finished hand trucks and
parts of hand trucks. The value of U.S. consumption increased steadily throughout the period for which
data were collected.

U.S. MARKET SHARES OF HAND TRUCKS AND PARTS

Market shares for hand trucks and parts (combined) are presented in table IV-10. U.S.
producers’ market share measured by value decreased during the period for which data were collected, as
did that of nonsubject imports. In contrast, the market share held by imports of hand trucks and parts
from China increased throughout the period.

° Data for components and for kits (which comprise multiple components) are presented separately, Such data are
consolidated in app. C.

IV-S


continued rapid growth in subject import volume between the interim periods was curbed by the current
antidumping proceedings.

The market penetration of subject imports of finished hand trucks measured in quantity increased
from 29.8 percent in 2001 to 37.6 percent in 2002, and then to 46.8 percent, in 2003. Overall, subject
import market share increased by 17.0 percentage points between 2001 to 2003. Subject import market
share was stable, although lower, in interim 2004 (45.5 percent) as compared to interim 2003 (45.8
percent).'°> As with import volume, further gains in market share by subject imports between the interim
periods were prevented by the current antidumping proceedings.

The growth in subject import market penetration came primarily at the expense of the domestic
industry, particularly in the annual periods examined. U.S. producers’ market share (by quantity)
decreased steadily from 67.3 percent in 2001 to 57.1 percent in 2002, and further to 50.9 percent in 2003,
an overall decrease of 16.3 percentage points. Domestic industry market share was lower in interim 2004
(48.3 percent) than in interim 2003 (51.7 percent).'* The market share of nonsubject imports of finished
hand trucks was generally stable in the annual periods examined.’ Therefore, the domestic industry lost
U.S. market share with respect to finished hand trucks primarily to subject imports over the period
examined, and not nonsubject imports.

Measured by value, the volume and market penetration of subject imports (finished hand trucks
and certain parts thereof) had similar trends. Subject import volume measured by value increased by ***
percent from $*** in 2001 to $*** in 2002. The volume increased by an additional *** percent to $***
in 2003. Overall, subject import volume increased by *** from 2001 to 2003. Moreover, subject import
volume measured by value was *** percent higher in interim 2004 ($***) than in interim 2003 ($***).'°°
The market penetration of aggregate subject imports measured by value *** from 2001 to 2003. It
increased from *** percent in 2001 to *** percent in 2002, then increased to *** percent in 2003.
Overall, subject import market share increased by *** percentage points from 2001 to 2003. Moreover,
the market share of aggregate subject imports measured by value was higher by *** percentage points in
interim 2004 *** as compared to interim 2003 ***.'°7

'°3 CR/PR at Table C-1.

14 CR/PR at Table IV-3.

15 Nonsubject import market share increased from 2.9 percent in 2001 to 5.3 percent in 2002, before decreasing
to 2.3 percent, in 2003, an overall decrease of 0.6 percentage points from 2001 to 2003. The market share of
nonsubject imports was higher (6.2 percent) in interim 2004 than in interim 2003 (2.5 percent). However, most of
the loss in market share experienced by the domestic industry occurred in the annual periods surveyed rather than in
interim 2004.

1° CR/PR at Table C-3.

1°7 CR/PR at Table C-3. Chinese producers argue that the increased levels of subject imports are not threatening
the domestic industry because the industry, and in particular, Gleason, has insufficient capacity to supply increased
domestic demand for hand trucks and hand truck parts. They maintain that Gleason’s reported capacity figures,
based on ***, are overstated. Chinese Respondents’ Posthearing Brief at 5-7.

#**_ However, ***. Commission staff reduced Gleason’s reported capacity by *** hand trucks, based on
Gleason’s actual production record, which did not include ***. Moreover, Gleason further revised the remaining
capacity so that it is based on *** shifts per day. (We note that at one of its facilities, Gleason is currently operating
three shifts per day. Tr. at 122-123). The domestic industry characterizes these data as a “conservative” estimate of
its capacity. These revised data reflect that the domestic industry’s capacity utilization was approximately ***
percent in 2002 and 2003, and that it was lower in interim 2004 *** percent) than in interim 2003 *** percent). CR
at ITI-3, n.7; PR at II-2, n.7. Therefore, the domestic industry has significant excess capacity with which to supply
increased demand for hand trucks.

16


other finished articles.'® All of the limited amount of U.S.-produced hand truck parts that are sold in the
United States are aluminum.

Manufacturing Processes, Facilities, and Employees

Three of the four component parts of a hand truck — the frame, handling area, and projecting
edges — normally are manufactured during a continuous production process. For a basic two-wheel steel
hand truck, the production process is as follows: (1) steel sheet is cut to form the projecting edge or base
plate; (2) steel tubing is then cut and formed into the exterior portion of the frame; (3) crossbars that
formed the interior portion of the frame are stamped and pressed; and (4) the axle and axle brace are
manufactured from round bar.’ The component parts are then welded together to create an article that
looks like a hand truck minus wheels. The final product is then cleaned and painted, and ready for the
addition of wheels. Different styles of hand trucks generally are manufactured using the same production
processes.'*

The wheels or casters used on the hand truck generally are manufactured by a separate
production process.'? They can be manufactured in the same plant as the hand truck assembly, but it is
just as likely that they are manufactured in a separate plant dedicated to the production of wheels and
casters. For a basic two-wheel steel hand truck, the wheels are manufactured using the following
components: tires, bearings, steel tubing, and wheel hubs. The finished wheels are then assembled on the
axle of the hand truck. The finished hand truck is then hand tagged and packed for delivery.

Six U.S. producers accounting for virtually all reported domestic hand truck production produce
both steel and aluminum hand trucks. Welded steel and aluminum hand trucks generally are
manufactured in the same production facilities using similar product processes.”” Riveted aluminum
hand trucks can also be manufactured in the same production facilities as welded hand trucks, but some
of the processes used to rivet the frame, handling area, and toe plate differ from the processes used to
weld these component parts into the final product. In addition, to reduce volume and freight expenses,
aluminum hand trucks can be sold unassembled in kits which contain all or some of the parts necessary to
assemble a finished hand truck.”! Such kits generally are assembled by the purchasers in the channel
through which they are distributed.”

Nylon hand trucks are produced in facilities that produce steel and aluminum hand trucks, but
require distinctive injection-molded equipment to produce lighter-weight, durable frames that do not rust.
However, while nylon hand trucks have injection molded side frames and cross members, they also have
steel toe plates and handles that are produced on shared manufacturing equipment.”

16 4+ reported that in 2003 it used the following percentage of the components it manufactured for products
outside the scope: frames (*** percent), handling areas (*** percent), and projecting edges (*** percent).

"Petition, p. 11.

'8 Gleason postconference brief, p. 9.
°° Petition, p. 12.

» Thid.

2! Hearing transcript, p. 119 (Straw).

22 ee

23 Hearing transcript, p. 89 (Rife).

15


U.S. EMPLOYMENT, WAGES, AND PRODUCTIVITY OF HAND TRUCKS

Data provided by U.S. producers on the number of production and related workers (“PRWs”)
engaged in the production of finished hand trucks, the total hours worked by such workers, and wages
paid to such PRWs during the period for which data were collected in this investigation are presented in
table III-7.

U.S. CAPACITY, PRODUCTION, AND CAPACITY UTILIZATION OF PARTS

Data on U.S. producers’ capacity, production, and capacity utilization on hand truck parts are
presented in table III-8.* Magline and B&P are the only U.S. producers to report production of hand
truck parts for commercial shipment.

U.S. PRODUCERS’ U.S. SHIPMENTS AND EXPORT SHIPMENTS OF PARTS

Data on domestic producers’ shipments of hand truck parts are presented in table III-9.
Commercial shipments accounted for 100 percent of U.S. shipments of hand truck parts. ***.5

U.S. PRODUCERS’ IMPORTS AND PURCHASES OF IMPORTS OF PARTS

Table III-10 presents the U.S. producers’ direct imports and purchases of parts of hand trucks.®
*** reported imports of parts of hand trucks and *** reported purchases of imported hand truck parts.”

U.S. PRODUCERS’ INVENTORIES OF PARTS
Data on end-of-period inventories of hand truck parts are presented in table III-11.'° ***,

U.S. EMPLOYMENT, WAGES, AND PRODUCTIVITY OF PARTS

Prd

U.S. PRODUCERS’ U.S. SHIPMENTS AND EXPORT SHIPMENTS
OF HAND TRUCKS AND PARTS

Data on domestic producers’ shipments of hand trucks and parts (combined) are presented in
table II-12. Because the quantities of finished hand trucks and hand truck parts are measured in distinct
units, the combined shipment volume presented below is based exclusively on value data for finished
hand trucks and parts of hand trucks.

* Data for components and for kits (which comprise multiple components) are presented separately. Such data are
consolidated in app. C.
9 all

'° Data for components and for kits (which comprise multiple components) are presented separately. Such data
are consolidated in app. C.

TH-5


likely that other purchasers would do so also. Evidence on the record indicates that purchasers can
switch to subject imports rapidly. Home Depot and Lowe’s had already reviewed subject imports for
potential purchase either through a line review or other qualification review.'*! They provided Gleason
with only a few months’ advance notice of their plans, either to phase out certain products over a few
months time, in the case of Home Depot, or discontinuing purchases in a few months time, with respect
to Lowe’s.'? Purchases by Home Depot and Lowe’s would likely involve large volumes of subject
imports, which would increase subject import volume and market penetration in the imminent future.
The actions by purchasers, as well as the increase and rate of increase in subject import volume and
market penetration that has already taken place over the annual periods examined, provides further
support for our conclusion that substantially increased subject imports are imminent if an antidumping

duty order is not imposed.
2. Production capacity in China; product shifting’

We find that Chinese producers have sufficient capacity to substantially increase production and
exports. There are no evident constraints on the ability of Chinese producers to increase their exports to
the United States. The five responding Chinese producers increased exports to the United States
significantly over the annual periods examined. They exported 687,594 hand trucks to the United States
in 2001, 744,423 hand trucks in 2002, and 931,194 hand trucks in 2003, an increase of 35.4 percent from
2001 to 2003.'* Exports of hand truck parts to the United States increased from zero in 2002 to ***
hand truck parts in 2003.'*° Chinese producers had excess capacity to produce hand trucks in interim
2004 and projected excess capacity in full year 2004.'*° Over the period examined, Chinese producers
shipped *** percent of their total exports of finished hand trucks to markets other than the United
States.'*"” Exports to these other markets declined in full year 2003, when exports to the United States
increased, indicating that Chinese producers could direct exports of hand trucks to the United States
instead of to these other markets.'**

As stated earlier, the industry is characterized as having high levels of variable costs. Consistent
with having low fixed costs, increasing effective capacity to produce hand trucks can be relatively easily
increased. Production capacity can sometimes be increased simply by adding additional personnel to a
production line.'*” Our data reflect that Chinese production levels for producing hand trucks or hand
truck parts can be ramped up quickly. For example, the two responding Chinese producers of hand truck
parts manufactured *** hand truck parts in 2002, but *** hand truck parts in 2003, all of which were

8! CR at V-3, V-26 -27, n.17; PR at V-27, V-9, n.17.

'2 Tr. at 86-89 (Kvasnicka, Simon, Gleason) (Notice to Gleason in June 2003 for phase-out to begin in October
2003 (4" Quarter) for Home Depot; Notice in September 2003 for discontinuance of purchases after February 2004
for Lowe’s).

319 U.S.C. § 1677(7)(F)@)D, (VD.

'34 The Chinese respondents projected reduced exports to the United States in 2004 and 2005. CR/PR at Table
VII-2. Given the increase in exports over the annual periods examined, and reports of additional Chinese producers
for which we have not received data, we have concluded that the reported lower export projections for full year 2005
and 2006, *** for the five responding Chinese producers, are not likely to be accurate for the Chinese industry as a
whole.

85 CR/PR at Table VII-3.
136 CR/PR at Table VII-2
57 CR/PR at Table VII-2.
8 CR/PR a Table VII-2.
TM Tr, at 97-98.

19


Federal Register/Vol. 69, No. 110/Tuesday, June 8, 2004/Notices

32043

8716.90.50 of the Harmonized Tariff
Schedule of the United States.?

For further information concerning
the conduct of this phase of the
investigation, hearing procedures, 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 and C (19 CFR part 207).
EFFECTIVE DATE: May 24, 2004.

FOR FURTHER INFORMATION CONTACT:
Elizabeth Haines (202-205-3200), Office
of Investigations, U.S. International
Trade Commission, 500 E Street SW.,
Washington, DC 20436. Hearing-
impaired 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 investigation may be viewed on the
Commission’s electronic docket (EDIS)
at http://edis.usitc.gov.

SUPPLEMENTARY INFORMATION:

Background.—The final phase of this
investigation is being scheduled as a
result of an affirmative preliminary
determination by the Department of
Commerce that hand trucks from China
are being sold in the United States at
less than fair value within the meaning
of section 733 of the Act (19 U.S.C.

§ 1673b). The investigation was
requested in a petition filed on
November 13, 2003, by Gleason
Industrial Products, Inc., Los Angeles,

+ For purposes of this investigation, the
Department of Commerce hes defined the subject
merchandise as “hand trucks manufactured from
any material, whether assembled or unassembled,
complete or incomplete, suitable for any use, and
certain parts thereof, namely the vertical frame, the
handling area and the projecting edges or toe plate,
and any combination thereof. A complete or fully
assembled hand truck is a hand-propelled barrow
consisting of a vertically disposod frame having a
handle or more than one handle at or near the
‘upper section of the vertical frame; at least two
wheels at or near the lower section of the vertical
frame; and a horizontal projecting edge or edges, or
toe plate, perpendicular or angled to the vertical
frame, at or near the lower section of the vertical
frame.” The Department of Commorce excluded
from its definition of subject merchandise the
following items: ‘small two-wheol or four-wheel
utility carts specifically designed for carrying loads
like personal bags or luggage in which the frame is
made from telescoping tubular material measuring
less than % inch in diameter; hand trucks that uso
motorized operations either to move the hand truck
from one location to the next or to assist in the
lifting of items placed on the hand truck; vertical
carriers designed specifically to transport golf bags;
and wheels and tires used in the manufacture of
hand trucks.”

CA. On December 1, 2003, Gleason filed
an amendment to the petition to include
Precision Products Inc., Lincoln, IL, as
a co-petitioner.

Participation in the investigation 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 final phase of this
investigation as parties must file an
entry of appearance with the Secretary
to the Commission, as provided in
section 201.11 of the Commission’s
tules, no later than 21 days prior to the
hearing date specified in this notice. A
party that filed a notice of appearance
during the preliminary phase of the
investigation need not file an additional
notice of appearance during this final
phase. The Secretary will maintain a
public service list containing the names
and addresses of all persons, or their
representatives, who are parties to the
investigation.

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 the final phase of this
investigation available to authorized
applicants under the APO issued in the
investigation, provided that the
application is made no later than 21
days prior to the hearing date specified
in this notice. Authorized applicants
must represent interested parties, as
defined by 19 U.S.C. 1677(9), who are
parties to the investigation. A party
granted access to BPI in the preliminary
phase of the investigation 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 final phase of this
investigation will be placed in the
nonpublic record on September 23,
2004, and a public version will be
issued thereafter, pursuant to section
207.22 of the Commission’s rules.

Hearing—The Commission will hold
a hearing in connection with the final
phase of this investigation beginning at
9:30 a.m. on October 7, 2004, 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 September 30, 2004. 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 October 5,
2004, 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), and
207.24 of the Commission's rules.
Parties must submit any request to
present a portion of their hearing
testimony in camera no later than 7
days prior to the date of the hearing.
iritten submissions —Each p:
who is an interested party shall submit
a prehearing brief to the Commission.
Prehearing briefs must conform with the
provisions of section 207.23 of the
Commission’s rules; the deadline for
filing is September 30, 2004. 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 207.25 of
the Commission’s rules. The deadline
for filing posthearing briefs is October
15, 2004; 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 investigation may submit a
written statement of information
pertinent to the subject of the
investigation on or before October 15,
2004. On November 3, 2004, 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 November 5, 2004, but such final
comments must not contain new factual
information and must otherwise comply
with section 207.30 of the Commission’s
tules. All written submissions must
conform with the provisions of section
201.8 of the Commission’s rules; any
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).

In accordance with sections 201.16(c)
and 207.3 of the Commission’s rules,
each document filed by a party to the
investigation must be served on all other
parties to the investigation (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.



12 days. For importers, lead times for items sold from inventory ranged from one to 15 days in most
cases, while lead times for special order items ranged from seven days to as much as 120 days.

U.S. inland shipping distances for U.S.-produced hand trucks were compared with those for hand
trucks from China sold by U.S. importers at the same level of trade as U.S. producers. For U.S.
producers, 22 percent of their U.S. sales occur within 100 miles of their storage or production facility, 40
percent are within distances of 101 to 1,000 miles, and 38 percent occur at distances of more than 1,000
miles from their facilities. For imports from China, an average of nearly 3 percent of sales occur within
100 miles of importers’ storage facilities, about 70 percent are within 101 to 1,000 miles, and 28 percent
involve distances of more than 1,000 miles.

SUPPLY AND DEMAND CONSIDERATIONS
U.S. Supply

The sensitivity of the domestic supply of hand trucks to changes in price depends on such factors
as the level of excess capacity, the availability of alternate markets for U.S.-produced hand trucks,
inventory levels, and the ability to shift to the manufacture of other products. The overall evidence
indicates that the industry has a high degree of flexibility in expanding output and U.S. shipments in
response to an increase in price, chiefly due to the low industry capacity utilization rates. The capacity
utilization rate was between 61 and 62 percent during 2001-03; during January-June 2004 it was 56
percent. Exports amounted to between *** and *** percent of total shipments by U.S. producers during
2001-03. During January-June 2004, they accounted for *** percent of shipments. The ratio of end-of-
period inventories to total shipments ranged between *** and *** percent during 2001-03.

When asked whether other products can be produced on the same production equipment and
machinery used to produce hand trucks, Gleason reported that the equipment and machinery ***.
However, it reported that ***. Seven of the other nine responding producers reported producing one or
more products on the machinery and equipment used to produce hand trucks. The products included
castors, cargo restraints, and pallet jacks.

Subject Imports

The supply response of Chinese producers to changes in price in the U.S. market is likely to
depend upon such factors as capacity utilization rates in China, the availability of home markets for
Chinese producers, and the availability of other export markets besides the United States. Chinese
producers reported a capacity utilization rate of 95 percent in 2003, suggesting that they have virtually no
capability of expanding production for export. The United States market accounted for about 49 percent
of Chinese industry shipments in 2003, while exports to other sources accounted for about 48 percent of
the total. China’s home market shipments accounted for only *** percent of its total shipments in 2003.
In view of the large export market for China’s hand trucks outside of the United States, Chinese suppliers
may have the potential to shift sales from these markets to the United States.

Demand Characteristics

The overall demand for finished hand trucks is determined by the needs of final consumers and
business customers for stacking and moving loads, while the demand for hand truck parts is a derived
demand that depends upon the demand for the final product (i.e. hand trucks). The overall demand for
finished hand trucks as measured by apparent U.S. consumption increased from 2.2 million units in 2001
to 2.9 million units in 2003. During January-June 2004, apparent U.S. consumption was 1.49 million
units as compared to 1.48 million in the same period in 2003. The overall demand for hand truck parts

I-2


Table VII-3
Hand truck parts: Chinese production capacity, production, shipments, and inventories, 2001-03,
January-June 2003, January-June 2004, and projected 2004-05

* * * * * * *
U.S. IMPORTERS’ INVENTORIES
*** importers reported inventories of subject imports during the period for which data were
collected.’ Data collected in this investigation on U.S. importers’ end-of-period inventories of hand
trucks and parts are presented in table VII-4 and table VII-5.
U.S. IMPORTERS’ CURRENT ORDERS FOR HAND TRUCKS

Ten firms reported imports or arrangements for the importation of a total of *** hand trucks from
China after June 30, 2004.°

DUMPING IN THIRD-COUNTRY MARKETS

Based on available information, hand trucks and parts from China have not been subject to any
other import relief investigations in the United States or in any other countries.

7 Twenty-one firms reported inventories of finished hand trucks from China and four firms reported inventories of
finished hand trucks from other sources. Five firms reported inventories of hand truck parts from China and two
firms reported inventories of hand truck parts form other sources.

5 Data for components and for kits (which comprise multiple components) are presented separately. Such data are
consolidated in app. C.

° Those firms were ***, In addition, ***,

VII-3


Table IV-3

Finished hand trucks: Apparent U.S. consumption and market shares, 2001-03, January-June 2003, and

January-June 2004
Calendar year January-June
Item 2001 2002 2003 2003 2004
Quantity (units)
Apparent U.S. consumption’ 2,182,933] 2,494,644] 2,879,565 1,476,579 1,490,942
Value (1,000 dollars)
Apparent U.S. consumption’ 67,662 72,697 78,820 40,493 41,770
Share of quantity (percent)

U.S. producers’ U.S. shipments" 67.3 57.1 50.9 51.7 48.3
U.S. imports from--

China 29.8 37.6 46.8 45.8 45.5,

Nonsubject countries 2.9 53 2.3 2.5 6.2

All countries 32.7 42.9 49.1 48.3 51.7

Share of value (percent)

U.S. producers’ U.S. shipments* 79.8 73.4 67.8 68.5 63.1
U.S. imports from--

China 14.2 20.4 27.1 25.9 32.5

Nonsubject countries 6.0 6.5 51 5.6 45

All countries 20.2 26.9 32.2 31.5 36.9

Note.—Because of rounding, figures may not add to the totals shown.

‘U.S. producers reported no internal consumption or company transfers of hand trucks.

Source: Compiled from data submitted in response to Commission questionnaires and from official Commerce statistics.

Pushed hand trucks: Ratio of U.S. imports to U.S. production, by sources, 2001-03, January-June 2003, and
January-June 2004
Calendar year January-June
Item 2001 2002 2003 2003 2004
Ratio of U.S. imports to production (percent)

China 44.4 62.7 90.0 82.7 92.1
Nonsubject countries 44 8.8 44 46 12.5

All countries 48.8 71.5 94.5 87.4 104.7
Source: Compiled from data submitted in response to Commission questionnaires and from official Commerce statistics.



Table VII-4

Finished hand trucks: U.S. importers’ end-of-period inventories of imports, 2001-03, January-June

2003, and January-June 2004

Source

Calendar year

January-June

2001

2002

2003

2003

2004

Imports from China:

Inventories (units)

120,735

115,821

223,477

148,779

418,740

Ratio to imports (percent)

21.4

19.4

17.6

16.8

20.5

Ratio to U.S. shipments of imports
(percent)

23.1

19.2

19.3

18.4

25.5

Imports from all other sources:

Inventories (units)

Ratio to imports (percent)

Ratio to U.S. shipments of imports
(percent)

see

Imports from all sources:

Inventories (units)

Ratio to imports (percent)

Ratio to U.S. shipments of imports
(percent)

tee

import and shipment data.

Source: Compiled from data submitted in response to Commission questionnaires.

Note.—Because of rounding, figures may not add to the totals shown. Partial-year ratios are based on annualized

Table ViI-5

Hand truck parts: U.S. importers’ end-of-period inventories of imports, 2001-03, January-June

2003, and January-June 2004

* *

Vil-4


With respect to volume, section 771(7)(C)(i) of the Act provides that the “Commission shall
consider whether the volume of imports of the merchandise, or any increase in that volume, either in
absolute terms or relative to production or consumption in the United States, is significant.” As discussed
above, we find that the volume of subject imports, and the increase in that volume, in absolute terms and
relative to domestic consumption and production, is significant.

With respect to prices, section 771(7)(C)(ii) of the Act provides that the Commission shall
consider whether —

(09) there has been significant price underselling by the imported merchandise as compared
with the price of domestic like products of the United States, and

(I) __ the effect of imports of such merchandise otherwise depresses prices to a
significant degree or prevents price increases, which otherwise would have
occurred, to a significant degree.'*

We find that subject imports have significantly undersold the domestic product. We do not find
evidence of significant price depression by subject imports, for the reasons set forth in our threat of
material injury determination.'*” We find that subject imports have suppressed domestic prices to some
degree.'** We do not find that these price effects have currently been significant.'”

In examining the impact of the subject imports on the domestic industry, we consider all relevant
economic factors that bear on the state of the industry in the United States.'"° These factors include
output, sales, inventories, capacity utilization, market share, employment, wages, productivity, profits,
cash flow, return on investment, ability to raise capital, and research and development. No single factor

185(_ continued)
following suspension of liquidation. Gleason Prehearing Brief at 27.

18 19 U.S.C. § 1677(7)(C)ii).

187 Gleason argues that the domestic industry is currently experiencing price-depressing effects from subject
imports because average unit values for Product 1 have declined since 1996. Petitioners’ Prehearing Brief at 23-25,
Exhibit 9. We base our present material injury pricing analysis on the pricing data gathered during the period
examined,

188 The domestic industry’s cost of goods sold (“COGS”) as a share of net sales increased from *** percent in
2001 to *** percent in 2002 and then jumped to *** percent in 2003. It was *** percent in interim 2004 as
compared to *** percent in interim 2003. CR/PR at Table C-3.

‘89 We note that the domestic industry argues that it has added features to its hand trucks without raising its
prices, due to price competition from subject imports, and that therefore, subject imports have had a price-
suppressing effect. Gleason Posthearing Brief, Exhibit 1, at 1-3. We find that although price competition from
subject imports may be having this effect, there is inconclusive evidence on the record that subject import prices
have caused the domestic industry to engage in these marketing practices.

1 19 U.S.C. § 1677(7)(C)(iii). See also SAA at 851 and 885 (“In material injury determinations, 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 also may demonstrate that an
industry is facing difficulties from a variety of sources and is vulnerable to dumped or subsidized imports.” Id. at
885.).

27


VIEWS OF THE COMMISSION

Based on the record in this investigation, we determine that an industry in the United States is
threatened with material injury by reason of less-than-fair-value (LTFV) imports of hand trucks and
certain hand truck parts from China.

While we do not find that the domestic industry is currently materially injured by reason of the
subject imports from China, recent volume trends and data indicate an imminent significant rate of
increase in subject import volume, and that material injury by reason of subject imports would occur
unless an order is issued. Indeed, significant purchasers have stated that they will switch from buying
from the domestic industry to subject sources unless an antidumping duty is issued. Subject imports have
significantly increased over the period, and significantly undersell the domestic like product. While this
has not yet resulted in material injury to the industry by reason of the imports, declining indicators of the
industry, particularly its declining financial condition, render it vulnerable to the effects of further
dumped imports which we find are imminent. The record reflects that two of the largest U.S. purchasers
of hand trucks, ***, changed or postponed their decision to source hand trucks from China rather than
from domestic producers due to their concern that imports would be subject to significant antidumping
duties. Accordingly, we determine that, absent issuance of an antidumping duty order, further subject
imports are imminent and material injury by reason of subject imports will occur. We explain our
findings below.

I BACKGROUND

A hand truck typically consists of a vertical frame with a handle (or handles) near the top; at least
two wheels near the bottom; and a horizontal projecting edge (or edges), or toe plate, near the bottom
which is perpendicular or angled to the vertical frame. The projecting edge or toe plate slides under a
load for purposes of lifting and/or moving the load.'

Petitioners are Gleason Industrial Products, Inc., and its jointly-owned and operated affiliate,
Precision Products, Inc. (collectively “Gleason”).” Gleason is by far the largest U.S. producer of hand
trucks. There are 21 firms believed to have produced hand trucks in 2003, 11 of which provided
questionnaire responses to the Commission.? The firms have production facilities in Georgia, Illinois,
Indiana, Kansas, Michigan, Minnesota, New Jersey, Ohio, Pennsylvania, and South Dakota.*

Apparent U.S. consumption of hand trucks grew steadily over the period examined.

Domestic production accounted for more than one-half of the U.S. market for hand trucks during the
2001 to 2003 period, and accounted for slightly less than one-half in interim 2004. By far the next
largest source of hand trucks was imports from China, which gained 17 percentage points of market share
for finished hand trucks (measured in quantity) between 2001and 2003. Domestically produced hand
trucks as well as subject imports from China are sold to home improvement, hardware, and warehouse

' Confidential Report (“CR”) at 1-4; Public Report (“PR”) at 1-3.

> CR/PR at I-1.

> CR/PR at III-1. Ten firms, believed to represent 90 percent of U.S. hand trucks production in 2003, provided
usable trade data on their U.S. operations producing hand trucks and parts, and eight firms provided usable financial
data. One producer responded, but did not provide usable data.

* CR/PR at Table III-1.


the subject merchandise from China, seven purchasers answered yes. These purchasers included ***,
*** reported that purchase orders of certain Chinese-produced hand trucks had been cancelled. ***
stated that it has reduced purchases of hand trucks from China dramatically. It also reported that the
preliminary antidumping duty has erased its profit margin. It intends to cease purchasing hand trucks
from China completely by the end of the year.

Substitute Products

When asked what products serve as substitutes for hand trucks, the majority of questionnaire
respondents stated that no substitutes exist. However, a few firms did list potential substitutes, including
wheel barrows, carts, dollies, fork lifts, pallet jacks, and platform trucks.

SUBSTITUTABILITY ISSUES

The extent of substitutability between domestic hand trucks and subject and nonsubject imports,
between subject imports from different sources, and between subject and nonsubject imports is examined
in this section. The discussion of substitutability issues is based upon the results of questionnaire
responses from producers, importers, and purchasers.

A total of 24 purchasers submitted questionnaires. The respondents included home improvement
stores, hardware stores, catalogue houses, two warehouse clubs,’ a supermarket chain, and various
retailers and end users. Of these purchasers, five have purchased U.S.- produced products but not subject
imports since January 2001, six have purchased only Chinese-produced hand trucks, and 13 have bought
both U.S.-produced and Chinese-produced hand trucks. Four firms also reported purchases of hand
trucks from other import sources including Canada, Germany, and Taiwan. The combined value of the
purchases of hand trucks by these 24 firms was about $42 million in 2003. Purchases of imports from
China amounted to approximately 12 percent of the total in that year. Three of the 24 firms also reported
purchases of hand truck parts since 2001. All three firms bought these parts from U.S. producers; one
also bought parts from nonsubject import sources and one purchased parts from China.

Factors Affecting Purchasing Decisions
When asked to rank the three most important factors involved in purchasing decisions, price and
quality were most commonly chosen, followed by availability. Of the 23 purchasers that responded, 21

ranked price among the top three factors, 16 ranked quality among the top three, and eight ranked
availability among the top three (table II-1).

° The Commission received questionnaires from *** and *** which both purchase ***,

I-4




Table I-1

Finished hand trucks: U.S. producers’ and importers’ commercial U.S. shipments, by channels of distribution,

2001-03, January-June 2003, and January-June 2004

~ January-June
tem . 2001 2002 2003 2003 2004
Quantity (units)
U.S, producers’ U.S. shipments to: a ~
Catalog houses/distributors . 238,399 178,423 170,119 79,646 112,496
Home improvement stores . . a “ “ co po
Hardware stores . - “ ao ms
Club warehouses oe - os
Office supply stores ae oe oe one ae
Allother firms ca Sid a ~ oe
Total . 1,468,849 1,425,093 1,467,009 763,018 720,296
U.S. shipments of imports from Chins
Catalog housesidistributors 149,224 147,919 165,018 91,308 97,352
Home improvement stores 143,706 85,205 146,140 74,868 “
Hardware stores . 19,221 29,818 36,033 14,586 16,888
Club warehouses . - “ ca oe
Office supply stores ” Sal ” - oe
All other firms .. . - a ~
Total . 522,874 600,040 ‘1,153,825 309,768 820,011
U.S. shipments of imports from oth
Catalog houses/distributors . al Sad “ -
Home improvement stores oo oe os ae -
Hardware stores ~ “ a - me
Club warehouses . . ~~ os os a ~
Office supply stores os ae a on a
All other firms os a a “ ane
Total... 76,348 “43,205 47,793
Share of quantity (percent)
USS. producers’ U.S. shipments to: ~
Catalog houses/distributors . 162 12.5 11.6 10.4 15.6
Home improvement stores ~ “ -
Hardware stores . ” hel hele ~ 7
Club warehouses . - ~ a aoa oe
Office supply stores . Sa ” om
All other firms ” we oe we
Total... : 100.0 “400.0 100.0 100.0 100.0
USS. shipments of imports from China:
Catalog houses/distributors . 28.5 247 143 228 11.9
Home improvement stores 275 142 127 187 Sad
Hardware stores . 37 50 34 36 24
Club warehouses . = “ os oe
Office supply stores . iced ” - ee Sal
All other firms - os ad ~ ca
Total... . 100.0 100.0 100.0 100.0 100.0
USS. shipments of imports from other:
Catalog houses/distributors........ ” oe - “ ”
Home improvement stores . oad a -
Hardware stores .. ~ “ co ” oe
Club warehouses . co - - oe
Office supply stores . ~ ~ a a os
All other firms .... Sid sal ad - ve
Total... 0. ee ee eee ee eee een ees 100.0 100.0 100.0 100.0 100.0

Source: Compiled from data submitted in response to Commission questionnaires.

18


B. Analysis of Statutory Threat Factors

We determine that the domestic industry producing hand trucks and parts thereof is threatened
with material injury. We make this determination due to several factors. The volume of subject imports
has already rapidly increased over the period examined and substantially increased subject imports are
likely in the imminent future. Subject imports are entering the U.S. market at prices that undersell
domestic prices to a significant degree, and that are likely to increase demand for subject imports in the
future. Large purchasers of hand trucks accounting for a significant portion of domestic consumption
purchase these goods based primarily on price, making it likely that the volume and market share of
lower-priced subject imports will increase. ***.°° Their prior purchasing patterns reflect that they will
likely purchase subject imports in large quantities. There are no evident capacity constraints on the
ability of Chinese producers to increase exports to the United States. The lower-priced subject imports
are likely to prevent price increases by domestic producers even if costs continue to rise. Absent
antidumping relief, imminent increases in subject import volume will accelerate the loss of operating
income that has already been pronounced over the period examined, leading to adverse overall
consequences for the condition of the domestic industry, and material injury. We find that the domestic
industry producing hand trucks and parts thereof is vulnerable to the effects of further subject imports.
We discuss these factors below.

1. Subject import volume and market penetration'”’

The volume and market penetration of subject imports increased at a high rate during the annual
periods examined, and were stable or higher in interim 2004 as compared to interim 2003.'' Moreover,
the market penetration of subject imports increased at a higher rate at the end of the annual periods
surveyed.

The volume of subject imports of finished hand trucks measured in quantity increased by 44.2
percent from 2001 to 2002, from 650,172 hand trucks in 2001, to 937,851 hand trucks in 2002. Volume
increased by an additional 43.6 percent in 2003 to 1.3 million hand trucks. Overall, subject import
volume increased by 107.1 percent from 2001 to 2003. Subject import volume was 0.4 percent higher in
interim 2004 (678,309 hand trucks) than in interim 2003 (675,556 hand trucks).'” As explained below,

5§(...continued)
market penetration of imports of the subject merchandise indicating the likelihood of substantially increased imports;
whether imports of the subject merchandise are entering at prices that are likely to have a significant depressing or
suppressing effect on the domestic prices and are likely to increase demand for further imports; inventories of the
subject merchandise; the potential for product-shifting; and the actual and potential negative effects on the existing
development and production effects of the domestic industry. 19 U.S.C. § 1677(7)(F)(i). Statutory threat factor (I)
is inapplicable, as no countervailable subsidies are involved, and statutory threat factor (VII) is inapplicable, as no
imports of agricultural products are involved.

* Chinese Respondents’ Posthearing Brief, ***; CR at V-27, n.17; PR at V-9, n.17. ***,

1 19 U.S.C. § 1677(7)(F)(i)(ID.

©! Due to differences in physical characteristics and values between finished hand trucks and the various types of
hand truck parts within Commerce’s scope of investigation, these subject imports cannot be analyzed in a meaningful
way by directly aggregating them by quantity. Therefore, in our volume analysis, we have relied on (1) quantity-
based volume and consumption data for finished hand trucks, which comprise the majority of subject imports,
CR/PR at Table C-1; and (2) value-based volume data and consumption data for all subject imports (finished hand
trucks and hand truck parts), CR/PR at Table C-3. We note that the trends in the two data sets are very similar.

1 CR/PR at Table C-1.

15


A. Demand Conditions

Apparent U.S. consumption of finished hand trucks measured in quantity terms increased by 31.9
percent from 2001 to 2003, and was 1.0 percent higher in interim 2004 as compared to interim 2003.”
Apparent U.S. consumption of finished hand trucks and parts, measured by value, increased by ***
percent from 2001 to 2003, and was *** percent higher in interim 2004 as compared to interim 2003.
The parties disagree as to the cause of the significant increase in demand for hand trucks.”

Demand for hand truck parts is derived from the demand for finished hand trucks, and accounted
for a comparatively small amount of demand. Apparent U.S. consumption of hand truck parts, measured
in value terms, was *** as compared to *** for finished hand trucks.*”

Hand trucks are sold to residential, industrial and office/small business customers through a
variety of channels of distribution: home improvement stores, club warehouses, hardware stores, catalog
houses/industrial distributors, office supply stores and other firms.°' Domestic producers’ U.S.
shipments of finished hand trucks were primarily sold through home improvement stores, which
accounted for *** percent of domestic shipments, and club warehouses, which accounted for *** of
domestic shipments, during the annual periods examined. Catalog houses/distributors were the next
largest category, accounting for *** percent of domestic shipments in the annual periods surveyed.”

Importers’ U.S. shipments of finished hand trucks were also primarily sold to home improvement
stores, club warehouses, and catalog houses/distributors. However, for importer shipments, club
warehouses rather than home improvement stores were the dominant channel of distribution. Importers’
U.S. shipments of finished hand trucks to club warehouses accounted for *** percent to *** percent of
shipments in the annual periods surveyed, catalog houses/distributors accounted for *** percent of
shipments, and home improvement stores accounted for *** percent to *** percent of shipments. In
2003, *** percent of importer shipments of finished hand trucks went to other customers.**

Although domestic producer U.S. shipments of finished hand trucks were relatively stable over
the period examined, importer shipments of Chinese finished hand trucks approximately doubled from

“7 CR/PR at Table C-1.

48 CR/PR at Table C-3.

“© *** stated that demand increased due to changes in the economy that have caused frequent relocations by
companies, necessitating movement of property and goods. Harper Trucks argues that demand increased due to the
increased availability of hand trucks to consumers at major retailers. CR at II-4; PR at II-3. In the preliminary phase
of the investigation, one of the importers argued that imports from China at lower prices created a separate market
for hand trucks. CR at II-5; PR at II-3. The Commission asked purchasers whether differences between subject
imports from China and the domestic product affected demand for hand trucks or hand truck parts. None of the
purchasers reported that differences between domestic product and subject imports had any impact on demand for
hand trucks in the United States and none of the purchasers reported that there was a separate “lower-priced”
consumer market for hand trucks from China. CR at II-5-6; PR at H-3.

°° CR/PR at Table C-1, Table C-2.

5! CR/PR at Table I-1.

°2 Calculated from CR/PR at Table I-1. Approximately *** percent of domestic producers’ U.S. shipments went
to home improvement stores over the period examined, with the exception of interim 2004 when this percentage
dropped to *** percent. Domestic producers’ U.S. shipments to club warehouses ranged from *** percent to ***
percent from 2001 to 2003, before increasing to *** percent in interim 2004. Domestic producers’ U.S. shipments to
hardware stores ranged from *** percent to *** percent from 2001 to 2003, before increasing to *** percent in
interim 2004. Domestic producers’ U.S. shipments to office supply stores and other firms were relatively small over
the period examined. CR/PR at Table I-1.

*3 CR/PR at Table I-1; CR at I-13 & n.36; PR at I-7 & n.36.

10


CONTENTS

Page

Appendixes
A. Federal Register notices ©... 06.6... ence n tenes A-l
B. Hearing witnesses . B-1
C. Summary data C1
D. Weighted-average landed duty-paid values per unit for products 1, 2, 3, and 4, and quantities

of imports by importers that sell directly to retail customers and other end-use customers .... D-1
E. Prices reported by individual producers, by product and by channel of distribution ........ E-1
F, Alleged effects of imports of hand trucks and certain parts thereof from China on U.S.

producers’ existing development and production efforts, growth, investment, and

ability to raise capital 6.2.66... ccc e nena F-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.

iti




Table V-6

Hand trucks: Weighted-average f.o.b. prices and quantities of domestic and imported product 2
sold to catalog houses/industrial supply distributors, margins of underselling/(overselling), and the
quantity and landed duty-paid value per unit of imports by firms that sell through catalogs, by
quarters, January 2001-June 2004

* * * * * * *

Table V-7

Hand trucks: Weighted-average f.o.b. prices and quantities of domestic product 3 sold to home
improvement stores and the quantity and landed duty-paid value per unit of imports by ***, by
quarters, January 2001-June 2004

* * * * * * *

Table V-8

Hand trucks: Weighted-average f.o.b. prices and quantities of domestic and imported product 3
sold to hardware stores and margins of underselling/(overselling), by quarters, January 2001-June
2004

Table V-9

Hand trucks: Weighted-average f.o.b. prices and quantities of domestic and imported product 3
sold to catalog houses/industrial supply distributors, margins of underselling/(overselling), and the
quantity and landed duty-paid value per unit of imports by firms that sell through catalogs, by
quarters, January 2001-June 2004

* * * * * * *

Table V-10

Hand trucks: Weighted-average f.o.b. prices and quantities of domestic and imported product 4
sold to hardware stores and margins of underselling/(overselling), by quarters, January 2001-June
2004

Table V-11

Hand trucks: Weighted-average f.o.b. prices and quantities of domestic and imported product 4
sold to catalog houses/industrial supply distributors, margins of underselling/(overselling), and the
quantity and landed duty-paid value per unit of imports by firms that sell through catalogs, by
quarters, January 2001-June 2004

* * * * * * *
Figure V-1
Hand trucks: Weighted-average f.o.b. prices of domestic and imported product 1 sold to home

improvement stores, and landed duty-paid value per unit of imports by ***, by quarters, January
2001-June 2004

V-5


exported to the United States.’ The five responding Chinese producers of hand trucks exported 744,423
hand trucks to the United States in 2002 and 931,194 in 2003, an increase of 25 percent in one year.

In addition, product-shifting is a potential source of additional Chinese capacity. Several of the
Chinese producers have reported that they produce other products on the same production equipment
they use to produce hand trucks.'*! Thus, although responding Chinese producers reported relatively
high capacity utilization rates, we do not consider these rates to represent an impediment to significant
increased exports of hand trucks from China to the United States.

The record reflects that there are several other Chinese producers of hand trucks that are not
represented in our capacity data.” Commerce issued dumping margins for six Chinese producers. One
of them, Future Tool, did not submit information to the Commission in response to our questionnaire.'**
Respondents reported that there are about 20 to 30 companies that export hand trucks to the United
States.'** Gleason argues that based on their questionnaire responses, the five responding Chinese
producers of finished hand trucks accounted for under thirty percent of 2003 Chinese production of hand
trucks.'** Responding Chinese firms’ share of total subject imports declined steadily over the period
examined. Comparing the companies’ reported exports of finished hand trucks to the United States to
official Commerce Department import statistics of finished hand trucks, the five responding Chinese
firms accounted for 105.8 percent of subject imports in 2001, 79.4 percent in 2002, 69.2 percent in 2003
and only *** percent in interim 2004.'° This indicates that over the period examined a growing share of
subject imports have been accounted for by Chinese producers that are not included in our data. Finally,
there is no indication that Home Depot, Lowe’s, or ***, who switched or decided to switch to sourcing
substantial quantities of hand trucks from China, had any concerns over whether Chinese producers
would be unable to meet their supply requirements.

Because of the Chinese industry’s apparent ability to increase capacity relatively easily, the
historical increase in exports to the United States over the period examined, the excess capacity in
interim 2004 and projected 2004, and the fact that our data does not include several Chinese producers,
we find that Chinese producers have sufficient available capacity to substantially increase exports to the
United States.

“© CR/PR at Table VII-3.

‘41 CR/PR at Table VIH-1. At the Commission hearing, Taifa’s representative reported that although it could
increase its capacity by 14 percent by switching production from other products to hand trucks, it is constrained by
long-term contracts from doing so. He stated that Taifa could not produce “many more” hand trucks above current
levels by product-shifting. Tr. at 169-170. We note, however, that there are several other Chinese producers that
produce other products on the same equipment as they produce hand trucks, namely ***. CR/PR at Table VII-1
Taifa has acknowledged that it could shift production to hand trucks to at least some extent. We consider the
possibility of product-shifting as providing additional support for our affirmative threat determination, but it is not
central to our determination.

\42 *«%, imported hand trucks from ***. Although it was issued a Commission questionnaire, ***. CR/PR at VII-
Ini.

"3 Compare CR /PR at I-1, n.5 and CR/PR at VII-1.

“4 CR/PR at VII-1.

145 Gleason Posthearing Brief at 12.

‘46 Calculated from CR/PR at Table VII-2 and Table IV-1.

20


specifically to transport golf bags; and wheels and tires used in the manufacture of hand.
trucks.'*

The scope of this investigation includes both finished hand trucks and hand truck parts. In the
discussion below, we first consider the appropriate like product treatment of domestically produced
finished hand trucks. We then consider how to treat those domestically produced hand truck parts - the
frame, the handling area, and the projecting edges or toe plate - that correspond to the hand truck parts
within Commerce’s scope of investigation.

Cc. Domestic Like Product Issues

In the final phase of this investigation, we find a single domestic like product comprising
finished hand trucks and certain hand truck parts corresponding to Commerce’s scope of investigation,
consistent with our domestic like product definition in the preliminary phase of this investigation.
Petitioner Gleason supports that definition and none of the respondents have challenged it.'®

Domestically produced finished hand trucks share common physical characteristics and uses,
channels of distribution, production facilities, and production processes. Some finished hand trucks are
designed for more specialized uses, and command higher prices. We do not find that these differences
among some hand trucks outweigh the commonalities shared by all hand trucks.'* We find, as we did in
the preliminary phase of the investigation, that there is no clear dividing line between different types of
finished hand trucks corresponding to Commerce’s scope of investigation, and treat them as a single
domestic like product.’”

Domestically produced hand truck parts corresponding to Commerce’s scope of investigation,
which includes combinations of these parts, are almost exclusively dedicated for use in finished hand
trucks, and these parts have no significant market other than in the production of finished hand trucks, or
replacement of parts for finished hand trucks.'* Hand trucks cannot serve their intended use without each
of the three parts that are included in Commerce’s scope of investigation. We include domestically
produced hand truck parts corresponding to Commerce’s scope within the same domestic like product as
finished hand trucks, as we did in the preliminary phase of the investigation. None of the parties
challenges this finding.

We consequently find that there is a single domestic like product in this investigation comprising
those finished hand trucks and hand truck parts described in Commerce’s scope of investigation.

' 69 Fed. Reg. 60980-01 (October 14, 2004).

'S The respondents in this investigation are China Chamber of Commerce for Import & Export of Machinery &
Electronics, Qingdao Huatian Hand Truck Co., Ltd., Qingdao Taifa Group Co. Ltd., Shandong Machinery Import &
Export Group Corporation, and Jiaonan Tianhe Hand Truck Co., Ltd., Quigdao Zhenhua Industrial Group Co., Ltd,
and Qingdao Xinghua Group Co. Ltd. (collectively “Chinese Respondents”) and Liberty Diversified Industries, Inc.
and its wholly owned subsidiary, Safco Products Co. (collectively “LDI”).

'© Hand Trucks and Certain Parts Thereof from China, Inv. No. 731-TA-1059 (Preliminary), USITC Pub. 3660 at
6 (January 2004) (“Preliminary Determination”).

'’ Preliminary Determination at 6.

5 CR at 1-6 & n.16; PR at 1-4-1-6 & n.16,



and 2003, and by *** percent overall.'” This downward trend continued in interim 2004. Operating
income was *** percent lower in interim 2004 than in interim 2003: $*** in interim 2004 as compared to
$*** in interim 2003. The domestic industry’s operating margin followed similar trends: *** percent in
2001, *** percent in 2002, and *** percent in 2003. Again, this downward trend continued into interim
2004. The domestic industry’s operating margin was *** percent in interim 2004 as compared to ***
percent in interim 2003.'” The domestic industry’s return on investment (the ratio of operating income
to total assets) was positive and stable from 2001 to 2002 before declining *** in 2003.'% Capital
expenditures were at similar levels in 2001 and 2003, but were *** lower in interim 2004 compared to
interim 2003.'”

Based on this information, we find that the domestic industry producing hand trucks and parts
thereof is in a weakened condition such that it is vulnerable to the effects of further subject imports.
Over the period examined, the domestic industry’s operating income has been ***, and its operating
margins have dropped ***. Even after these decreases in the annual periods examined, the domestic
industry’s operating income and operating margins were lower in interim 2004 than in interim 2003.
Although the industry’s production and capacity utilization with respect to finished hand trucks, and its
sales and shipments of hand trucks and parts, were generally stable from 2001 to 2003, they were lower
in interim 2004 than in interim 2003.

Absent antidumping relief, imminent increases in subject import volume will accelerate the loss
of operating income that has already been pronounced over the period examined. Six out of ten domestic
producers reported anticipated negative effects on their production efforts, including *** that accounted
for *** percent of domestic production in 2003.' *** provided evidence regarding the magnitude of the
negative potential effects on its operating income and sales if its Home Depot and Lowe’s accounts were
lost to Chinese competitors.” ***,'78

If the domestic industry loses the major Home Depot and Lowe’s accounts to its Chinese
competitors, as we expect, it is unlikely to replace these sales from other sources, given the size of the
accounts involved.'” The loss of these accounts will lead to sharp reductions in the industry’s

1? We note that the domestic industry argues that operating income, rather than operating margins, are the most
probative indicator of this industry’s profitability given its high variable costs.

"3 CR/PR at Table C-3.

'% CR/PR at Table VI-7.

TM Capital expenditures increased from $*** in 2001 to $*** before decreasing to $*** in 2003. Capital
expenditures were *** level of expenditure. CR/PR at Table VI-6.

TM CR/PR at Appendix F, Table III-1. None of the domestic producers commented on negative actual or
anticipated effects on development efforts. We note that Gleason considers hand truck production technology to be
“mature.” Gleason Prehearing Brief at 16-17.

17 CR at F-4, n.1; PR at F-3, n.1.

'8 CR/PR at Table at F-3. Chinese Respondents argue that the Commission must consider the fact that only ***
out of ten responding domestic producers support the petition, and that it is not reasonable to conclude that the
domestic industry is threatened when the majority of the domestic producers opposes or does not support that
finding. Chinese Respondents’ Prehearing Brief at 2. Although several smaller domestic producers oppose or take
no position regarding the petition, *** largest domestic producers of finished hand trucks, ***, support the petition
and alone accounted in the aggregate for *** percent of U.S. production of finished hand trucks in 2003. CR/PR at
Table III-1. *** also support the petition. Id. We note that the position of the industry is not determinative.
Allegheny Ludlum Corp. v. United States, 287 F. 3d 1365, 1375-76 (Fed. Cir. 2002).

"7° As noted above, Home Depot and Lowe’s accounted collectively for *** percent of U.S. apparent
consumption in 2003. LDI argues that the domestic industry is competitive in other channels of distribution, such as
the catalog/industrial distributor sector. We find that given the dominance of the home improvement channel of

(continued...)

25




32044 Federal Register/Vol. 69, No. 110/Tuesday, June 8, 2004/ Notices

Authority: This investigation is being
conducted under authority of title VII of the
‘Tariff Act of 1930; this notice is published
pursuant to section 207.21 of the
Commission's rules.

Issued: June 3, 2004.

By order of the Commission.
Marilyn R, Abbott,
Secretary to the Commission.
[FR Doc. 04~12923 Filed 6-7—04; 8:45 am]
BILLING CODE 7020-02-P



D. Domestic Industry and Related Parties
1. In General

Section 771(4) of the Act defines the relevant industry as “the producers as a [w]hole of a
domestic like product, or those producers whose collective output of a domestic like product constitutes
the major proportion of that product.””? In defining the domestic industry, the Commission’s general
practice has been to include in the industry all of the domestic production of the like product, whether
toll-produced, captively consumed, or sold in the domestic merchant market.” Based on our domestic
like product determination, we find that there is a single domestic industry consisting of all U.S.
producers of the domestic like product which, as stated above, consists of all finished hand trucks and
hand truck parts corresponding to Commerce’s scope of investigations.

2. Related Parties

In defining the domestic industry, we must determine whether any producer of the domestic like
product should be excluded from the domestic industry pursuant to section 771(4)(B) of the Act. 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.”' Exclusion of such a producer is within the Commission’s discretion based
upon the facts presented in each case.”

Five domestic hand truck producers (***) either imported subject merchandise or are wholly
owned by an importer, and thus are related parties under the statute. Accordingly, we examine whether
appropriate circumstances exist to exclude any of these firms from the domestic industry. No party has
argued for exclusion of any domestic producer as a related party, although Gleason stated that ***
qualify for exclusion. Chinese Respondents argue that no domestic producer should be excluded from
the domestic industry because the domestic producers that qualify as related parties account for a very
small percentage of domestic production of hand trucks.* For reasons discussed below, we find that
appropriate circumstances do not exist to exclude any of these firms from the domestic industry.

? 19 U.S.C. § 1677(4)(A).

° See United States Steel Group v. United States, 873 F. Supp. 673, 681-684 (Ct. Int’ Trade 1994), aff'd, 96
F.3d 1352 (Fed. Cir. 1996).

2119 U.S.C. § 1677(4)(B).

” Sandvik AB v. United States, 721 F. Supp. 1322, 1331-32 (Ct. Int’ Trade 1989), aff'd without opinion, 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 LTFV 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 without opinion, 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, Inv. Nos. 731-TA-741-743 (Final),
USITC Pub. 3016 (February 1997) at 14 n.81.

3 19 U.S.C. § 1677(4)(B).

* Chinese Respondent Posthearing Brief, Exhibit 1 at 1.

7


Federal Register/Vol. 69, No. 198/Thursday, October 14, 2004/ Notices

60985

ITC Notification

In accordance with section 735(d) of
the Act, we have notified the
International Trade Commission (ITC) of
our determination. As our final
determination is affirmative, the ITC
will, within 45 days, determine whether
these in. ports are materially injuring, or
threaten material injury to, the U.S.
industry. If the ITC determines that
material injury or threat of material
injury does not exist, the proceeding
will be terminated and all securities
posted will be refunded or canceled. If
the ITC determines that such injury
does exist, the Department will issue an
antidumping duty order directing the
CBP to assess antidumping duties on all
imports of the subject merchandise
entered, or withdrawn from warehouse,
for consumption on or after the effective
date of the suspension of liquidation.
Notification Regarding APO

This notice also serves as a reminder
to parties subject to administrative
protective order (APO) of their
responsibility concerning the
disposition of proprietary information
disclosed under APO in accordance
with 19 CFR 351.305. Timely
notification of return/destruction of
APO materials or conversion to judicial
protective order is hereby requested.
Failure to comply with the regulations
and the tarms of an APO isa
sanctionubie violation.

This determination is issued and
published pursuant to sections 735(d)
and 777(i)(1) of the Act.

Dated: (istober 6, 2004.

James J. Jocaum,

Assistant Secretary for Import
Administration.

Appendix—Issues in the Decision
Memorandum
Comments
Company Specific Issues
Comment 1: The Department Should

Apply Facts Available to Huatian, Taifa, True
Potential, and Xinghua.
Huatian

Comment 2: The Department Should
Revise Huatian’s FOP Data to Account for
Purchased Bearings.

Comment 3: The Department Should
Assign an Appropriate Surrogate Value for
‘Axle Rods for Huatian.

‘Comment 4: The Department Should
Apply Facts Available to Value Steel Plate for
Huatian.

Comment.5: The Department Should Treat
Huatiaa’s Hand Truck Samples as a Quantity
Discount.

Comment s: The Department Should Not
Adjust Huatian’s Sales Transactions with a
Negative Net United States Price.

Taifa

Comment 7: The Department Should
Accept Taifa’s July 30, 2004, Submission.

Comment 8: The Department Should
Disregard Taifa’s Market Economy Purchases.

‘Comment 9: The Department Should
Consider the Role Played by Taifa Import &
Export Company in Calculating the SG&A.
Expenses for Taifa.

Comment 10: The Department Should
Adjust Taifa’s Sales Database to Reflect
Customer Discounts.

Comment 11: The Department Should
Revise Taifa's FOP Database to Account for
Packing Materials.

True Potential

Comment 12: The Department Should Add
‘Trading Company Factors for SG&A and
Profit in Calculating True Potential’s Normal
Value.

Separate Rates

Comment 13: The Department Should
Deny Separate-Rates Treatment for All
Respondents.

Comment 14: The Department Should Not
Calculate a Separate Rate for True Potential.

Comment 15: The Department Should
Calculate a Separate Rate for Zhenhua.

Comment 16: The Department Should Not
Calculate Separate Rates for Future Too! and
Shangdong,

General Issues

Comment 17: The Department Should Not
Use the Indian Electricity Tariff Because it is
Aberrational.

Comment 18: The Department
Miscalculated SG&A and Profit Amounts.

Comment 19: The Department Should Not
Use Aberrational Financial Data to Value
Factory Overhead, SG&A Expenses, and
Profit,

Comment 20; The Department Should
Include the Cost of Packing Materials and
Labor in Calculating Factory Overhead and
SG&A,

Comment 21; The Department Should
Include Financial Data from an Indian Hand
‘Truck Producer in Calculating Financial
Ratios.

Comment 22: The Department Should
Revise the Profit Rate for the Final
Calculation.

[FR Doc. F4-2608 Filed 10-13-04; 8:45 am]
BILLING CODE 3510-Ds-p



In Support of the Imposition of
Antidumping Duties (continued):

Bill Malone, Vice President, Manufacturing, Gleason

Industrial Products, Inc.
David A. Rife, Vice President, Sales, Harper
Trucks, Inc.
David Straw, President and Chief Operating Officer,
Magline Inc.
Bruce Malashevich, President, Economic Consulting
Services
Matthew P. Jaffe )
Alexander H. Schaefer ) - OF COUNSEL
Sobia Haque )

In Opposition to the Imposition of
Antidumping Duties:

Katten, Muchin, Zavis, Rosenman

Chicago, IL

on behalf of

Liberty Diversified Industries, Inc.
Safco Products Company (“Safco”)

Pam LaFontaine, Director, Product Development
Marketing, Safco

Dan Zdon, General Manager, Safco

Mark S. Zolno )
) - OF COUNSEL
David R. Stepp )

B4




PART V: PRICING AND RELATED INFORMATION
FACTORS AFFECTING PRICES
Raw Material Costs

Raw material costs account for a large share of the cost of producing hand trucks. During 2001-
03, these costs consistently ranged between 46 and 50 percent of the cost of goods sold for finished hand
trucks. The chief raw material inputs include are steel, aluminum, and in some cases vinyl.

Transportation Costs to the U.S. Market

Ocean transportation costs for hand trucks shipped from China to the United States (excluding
US. inland costs) averaged approximately 25 percent of the customs value of these imports during 2003.
These estimates are derived from official import data and represent the transportation and other charges
on imports.!

U.S. Inland Transportation Costs

Transportation costs on U.S. inland shipments of hand trucks can account for a fairly large share
of the delivered price of these products. For U.S. producers, reported costs ranged from 2 to 18 percent
of the delivered price. The weighted average costs for producers was approximately 11 percent.” For
U.S. importers of hand trucks from China, these costs ranged from 2 to 20 percent. The weighted
average costs for these importers was approximately 13 percent.

Exchange Rates

Nominal exchange rates are not presented since the Chinese currency, the yuan, has been pegged
to the U.S. dollar since January 1, 1994. Therefore, the U.S. and Chinese currencies were virtually
constant in relation to each other throughout 2001-03 and January-June 2004.* Real exchange rates
cannot be calculated since no producer price index for China is available.

PRICING PRACTICES*

Prices of hand trucks are most commonly determined on a transaction-by-transaction basis by
both producers and importers. Among the responding producers, *** reported that it engages in
transaction-by-transaction negotiations with its customers. It also reported that the prices are subject to
continuing negotiations depending upon prevailing market conditions. Among other producers, methods

' The estimated cost was obtained by subtracting the customs value from the c.i.f. value of the imports for
2003 and then dividing by the customs value.

? Because of relatively and rising high inland transportation costs, shipping smaller, more compact kits is
sometimes more economical than shipping bulkier, fully-assembled hand trucks. Hearing transcript, p. 55 (Straw).

3 International Monetary Fund, International Financial Statistics, April 2003 and July 2004.

* The discussion of importer responses in this section focuses on those firms that sell hand trucks and hand truck
parts at the same level of trade as U.S. producers, as opposed to firms that import and sell directly to retail
consumers and other end-use customers.

V-1


Figure V-10
Hand trucks: Weighted-average f.o.b. prices of domestic and imported product 4 sold to hardware
stores, by quarters, January 2001-June 2004

* * * * * * *

Figure V-11

Hand trucks: Weighted-average f.o.b. prices of domestic and imported product 4 sold to catalog
houses/industrial supply distributors and landed duty-paid value per unit of imports by firms that
sell through catalogs, by quarters, January 2001-June 2004

* * * * * * *

Price Comparisons

U.S.-produced hand trucks were priced higher than imported hand trucks from China in 114
of 122 quarters where direct comparisons could be made. Margins of underselling ranged less than 0.5
percent to 80.7 percent as shown in table V-12. In the eight quarters where the import price was higher,
margins of overselling ranged from 0.8 percent to 75.5 percent. In addition to these direct comparisons,
the data in tables V-1, V-4, and V-7 show that *** average unit values of imports from China were
consistently well below U.S. producer prices on sales of products 1, 2, and 3 to home improvement
stores. Comparisons between U.S. producer prices and landed duty-paid purchase values by catalog
houses/industrial supply distributors are included in tables V-3, V-6, V-9, and V-11. In most cases the
landed duty-paid values of these imports were below U.S. producer sales prices. Additional data for
direct importers appear in appendix D.

LOST SALES AND LOST REVENUES

During the preliminary and final phases of this investigation, the domestic industry provided six
lost sales allegations and six lost revenue allegations that were specific enough to investigate.” The six
lost sales allegations totaled $19.8 million and involved 711,000 units of hand trucks and the six lost
revenues allegations totaled $300,000 and involved 80,000 units of hand trucks. The staff contacted all
purchasers to investigate the allegations. The results are summarized in tables V-13 and V-14.

° Other firms also provided lost sales allegations that were too general to investigate.

V-7


hand trucks, typically in smaller volumes, than are purchased in the home improvement sector.” Catalog
houses and industrial distributors purchase specialized hand trucks as well as general-task hand trucks.
Prices tend to be higher in the catalog/industrial distributor sector than in the home improvement sector.”
Industrial users from the healthcare, hospitality, and moving industries commonly purchase hand trucks
through the catalog/industrial user channel of distribution. For example, catalog houses and industrial
distributors sell hand trucks specifically designed to move cylinders, barrels and drums.”!

Office supply customers are a relatively small sector of the market. These customers may buy
hand trucks through national office supply stores, or through certain mail-order dealers.”

B. Supply Conditions

Gleason is by far the largest domestic producer of hand trucks, accounting for *** percent of
reported domestic production in 2003, followed by Angelus and Harper Trucks, Inc. (“Harper Trucks”),
*#* 3 Together with Gleason, these firms accounted for *** percent of reported 2003 domestic
production of finished hand trucks. There are also several much smaller domestic producers, and two
producers of hand truck parts.”

Effective capacity to produce hand trucks can be increased relatively easily, sometimes simply by
adding additional personnel to a production line.”* Several domestic producers, and several of the
responding Chinese producers, produce other products on the same equipment upon which they produce
hand trucks.” However, the *** largest domestic producers produce few or no other products using the
same production and related workers used to make hand trucks.””

The hand truck industry is characterized by a high level of variable costs relative to capital
investment.”* According to Gleason, this causes producers to cut production and attempt to retain
existing profit margins, rather than produce at a loss, when faced with competitive prices.” Gleason
argues that, due to the high variable costs, and the tendency of the industry to cut production rather than
price in the face of price competition, the absolute level of profit earned in the hand truck industry is
more probative than operating margins in reflecting the profitability of the domestic industry.*? Gleason

© LDI Posthearing Brief at 2-3.

” Gleason Posthearing Brief, Exhibit 1 at 3-4. Gleason argues that in recent years, competition across channels
of distribution has increased. Id. at 5-6. LDI Prehearing Brief at 2, 9.

TM CR at 1-9; PR at 1-6.

” Tr. at 177 (Dan Zdon, General Manager, Safco).

3 CR/PR at Table III-1.

TM Calculated from CR/PR at Table IlI-1.

5 Tr, at 56-58 (Straw).

76 CR at II-3, PR at Il-2; CR/PR at Table III-2 (domestic producers), Table VI-1 (Chinese producers).

7” CR/PR at Table III-2.

78 CR at VI-10; PR at VI-4. As an illustration of this point, at the Commission’s hearing, the President of
Gleason stated that Gleason had not considered what the performance of its company would be if it matched the
lower competing prices offered to Home Depot for hand trucks from China, because he would reduce production
rather than lower the prices to those levels, which were below his costs of production. Tr. at 85-86 (Simon).

9 Gleason Prehearing Brief, Exhibit A at 2.

®° Gleason Prehearing Brief, Exhibit A, all pages. Chinese Respondents argued Gleason’s analysis that the hand
truck industry *** is not reflected in the capacity utilization rates of other domestic producers. However, they do not
disagree that the industry has high variable costs. Chinese Respondents’ Prehearing Brief at 5, n.25, Questionnaire

(continued...)

12


APPENDIX B

HEARING WITNESSES


As with the quantity-based figures, higher subject import market share by value came at the
expense of the domestic industry. The domestic industry’s share of the market decreased by ***
percentage points from 2001 to 2003 and was lower in interim 2004 than in interim 2003. Nonsubject
imports’ share of the market decreased from 2001 to 2003 and was lower in interim 2004 than in interim
2003.'* Therefore, it was subject imports, not nonsubject imports, that gained significant market share
measured by value previously held by the domestic industry over the period examined.'”

The significant rate of increase in subject import volume and market penetration over the period
examined, in particular over the annual periods, indicates the likelihood of substantially increased subject
imports in the imminent future.''°

Moreover, the record reflects that if no duties are imposed on subject imports, ***, will switch
from purchasing domestic product to purchasing subject imports.'!' *** is the *** purchaser of hand
trucks in the U.S. market. It purchased or imported directly *** in 2003, equivalent to *** percent of
domestic consumption.''? *** purchased *** hand trucks in 2003, equivalent to *** percent of apparent
domestic consumption in that year. Both of these companies ***.

Gleason was Home Depot’s exclusive supplier of hand trucks from ***. Home Depot began to
phase out its purchases of Gleason’s two highest-volume hand trucks, the d-handle and the convertible
models, starting in September 2003.'> Home Depot planned to discontinue purchasing these products
from Gleason by April 2004.''* *** estimated that the combined annual volume of these purchases
would have been *** hand trucks, valued at more than $*** in 2004.''* Gleason provided evidence of
the decline in Home Depot’s purchases of these products in 2003 and 2004,''* and estimated that the
combined annual volume of these potential lost sales would have been *** hand trucks valued at $***,''7
In the final phase of the investigation, *** reported that after preliminary margins went into effect

1°8 CR/PR at Table C-3.

' The volume of subject imports of finished hand trucks measured in quantity was equivalent to 44.4 percent of
US. production of finished hand trucks in 2001, 62.7 percent in 2002, and 90.0 percent in 2003. It was 92.1 percent
in interim 2004 as compared to 82.7 percent in interim 2003. CR/PR at Table IV-4.

The ratio of subject imports of hand truck parts (components and unassembled kits) to domestic production
of hand truck parts, was generally much lower than the ratio of finished hand trucks. CR/PR at Table IV-8.
However, given that the overwhelming majority of subject imports are finished hand trucks, whether measured in
quantity or value, we have primarily considered the ratio of subject imports of finished hand trucks to domestic
production of finished hand trucks.

"° In addition, our subject import volume data is derived from official statistics under the HTS reporting number
for industrial hand trucks, 8716.80.5010. These data do not include imports of finished hand trucks under basket
category 8716.80.5090 that cannot be accurately separated from other nonsubject imports in the basket category.

Therefore, our data do not include *** under this basket category that constitute subject merchandise. ***
imported *** in 2003 and *** in interim 2004. CR/PR at IV-1,n.3. These items are within the scope of this
investigation. They can be used as hand trucks, although they have other uses as well. Therefore, not only is the
subject import volume significant and increasing in the latter part of the period examined, 2003 and interim 2004, it
is understated.

' We note that the sourcing decisions of these two companies were discussed extensively at the Commission’s
public hearing. See, ¢.g., Tr. at 23-28; 33-34; 86-88; 161-162; 210; (Home Depot); and 26-28; 86-88; 126-129; 161-
162 (Lowe’s).

"? CR/PR at I-3.

"3 Tr, at 22 (Simon).

"4 Tr. at 33-35 (Simon); Tr. at 86-88 (Kvasnicka). CR at V-25; PR at V-9.

5 CR at V-25; PR at V-9.

"6 Gleason Prehearing Brief, Exhibit 11.

"7 CR at V-25; PR at V-9.

17


Table 1-5
Hand trucks: Comparisons between U.S.-produced and subject Chinese-produced products as
reported by U.S. purchasers

Number of firms reporting
Factor U.S. superior Comparable U.S. inferior

Availability 3 9 0
Delivery terms 3 9 0
Delivery time 7 5 0
Discounts offered 1 9 1
Extension of credit 4 141 0
Lower price’ 0 9
Minimum quantity requirements 3 4
Packaging 1 14 0
Product consistency 5 0
Quality meets industry standards 2 10 0
Quality exceeds industry

standards 5 7 0
Product range 3 9 (0)
Reliability of supply 5 7 0
Technical support/service 7 5 0
Lower U.S. transportation costs 3 8 1
Other 0) 0 0

* A rating of superior means that the price is generally lower. For example, if a firm reports “U.S. superior,”
this means that it rates the U.S. price generally lower than the China price.

Source: Compiled from data submitted in response to Commission questionnaires.

Comparisons of Domestic Products and Nonsubject Imports

Producers, importers, and purchasers also were asked to compare U.S.-produced hand trucks with
imports from nonsubject countries in terms of interchangeability and product differences using the same
criteria discussed. The very limited response to these questions presented in tables II-3 and II-4 indicates
that a majority of the questionnaire respondents were not able to compare U.S.-produced hand trucks
with nonsubject imports.

Comparisons of Subject Imports and Nonsubject Imports
Questionnaire respondents were also asked to compare imports from China with nonsubject

imports. The very limited responses presented in tables II-3 and II-4 are similar to comparisons between
U.S.-produced hand trucks and nonsubject imports.

IL-8


Federal Register/Vol. 69, No. 198/Thursday, October

14, 2004/ Notices 60983

corrected information regarding the
allocated inputs as a clerical error, as
required by NTN Bearings. NTN Bearing
Corporation v. United States, 74 F.3d
1204, 1208 (Fed. Cir.1995) (“NTN
Bearings"). Following NTN Bearings,
the Department established a six-part
test, indicating that it will accept
corrections of clerical errors when the
following conditions are met:

(1) The error in question must be
demonstrated to be a clerical error, not
a methodological error, an error in
judgement, or a substantive error; (2) the
Department must be satisfied that the
corrective documentation provided in
support of the clerical error allegation is
reliable; (3) the respondent must have
availed itself of the earliest reasonable
opportunity to correct the error; (4) the
clerical error allegation, and any
corrective documentation, must be
submitted to the Department no later
than the due date for the respondent's
administrative case brief; (5) the clerical
error must not entail a substantial
revision of the response; and (6) the
respondent's corrective documentation
must not contradict information
previously determined to be accurate at
verification. See Certain Fresh Cut
Flowers from Colombia; Final Results of
Antidumping Duty Administrative
Reviews, 61 FR 42833, 42834 (August
19, 1996).

Iu: order for the Department to accept
aclerica’ srror late in the proceeding, all
of the six conditions must be met. We
determine that Taifa’s allocation error
does not meet two of the six conditions.

Under this test, the Department must
be satisfied that the corrective
documentation provided in support of
the clerical error allegation is reliable.
As the Department noted in Taifa’s
verification report, the Department was
unable to verify the reliability of the
error with source documentation.
Specifically, the Department stated in
the verification report that
“* * *because of inaccuracies in the
data for the allocated inputs in the
electronic spreadsheets provided by
Taifa, we were unable to verify the
allocation of these inputs into the
second and third level spreadsheets,
and the reported per-unit consumption
of these inputs for any of the selected
models.” See Taifa Verification Report
at 18. Thus, as a result of the error, the
Department could not verify (1) whether
the correction submitted to the
Department was accurate; or (2) any of
Taifa’s allocated inputs because the
allocation formula given at verification
was incorrect. Because the Department
could not verify the corrected error, it
cannot be satisfied that the corrected
error is reliable, and therefore, the

second prong of the Department test is
not met.

In addition, the error submitted by
Taifa fails the fifth prong of the
Department's test, i.e., correction of this
clerical error must not entail a
substantial revision of the response.
Specifically, the error affected the usage
rates of a significant number of inputs
for every model sold in the United
States. Given that Taifa produced hand
trucks or inputs to hand trucks in many
workshops, that monthly data was
compiled for each workshop over the
six-month POI, and that Taifa reported
FOP for a large number of hand truck
models or parts, the error in Taifa’s
allocation formula affected thousands of
pieces of information that went into the
calculation of normal value. Although
we cannot know the correct amount that
these allocated inputs account for
relative to the total normal value
(because we do not know the correct
amount of the allocated inputs), based.
on the amounts used in Taifa’s July 2,
2004, submission, these inputs account
for approximately 25 percent of the total
value of the hand truck or hand truck
part. Based on this, we determine that
the correction proffered by Taifa would
be a substantial revision of the
company’s response.

Therefore, we have not accepted this
correction as a clerical error or minor
correction, nor have we relied on this
data contained in the July 30, 2004,
submission.

The allocated input data submitted in
Taifa's July 2, 2004, response is the data
that the Department sought to verify. As
explained by Taifa at verification, the
allocated input amounts in that
response were incorrect. Because Taifa
failed to provide the Department with
information in the form or manner
requested, and the July 2, 2004, data
could not be verified, we determine that
the usage rates for the allocated inputs
must be based on facts otherwise
available, in accordance with section
776(a)(2).

We further determine that Taifa failed
to cooperate by not acting to the best of
its ability. Specifically, Taifa was not
fully prepared for the verification of its
FOP database as was evidenced by the
fact that Taifa did not discover the error
in its allocation formula until the last
day of its verification. Moreover, Taifa
did not present the Department with
documentation for verification of this
error. If Taifa had been fully prepared,
it would have detected the allocation
error during the preparation for
verification, rather than the last day of
verification. Thus, in accordance with
section 776(b), we have applied an

adverse inference in selecting the usage
information for the allocated inputs.

Because we could not verify the
reported amounts of allocated inputs by
model in Taifa’s July 2, 2004,
submission, we have selected the
highest amount of the allocated inputs,
as follows. In our questionnaire in this
investigation, we requested Taifa to
assign each hand truck model/part into
one of 12 designated weight range
categories based on the shipping weight
of the hand truck/part. As adverse facts
available, we have selected the highest
reported amount for each allocated
input for hand trucks/parts within a
given weight range reported in Taifa’s
July 2, 2004, response and assigned that
value to all hand trucks/parts in that
weight range.
Xinghua

In the Preliminary Determination, we
calculated a margin for Xinghua in
which we applied partial facts available
in our calculation of normal value
because of inconsistencies between the
reported weights for completed hand
trucks and parts, and the reported
inputs used to produce the hand trucks
and parts. See Preliminary
Determination, 69 FR at 29514,
Subsequent to the Preliminary
Determination, we conducted
verif sation of Xinghua's questionnaire
respenses from July 26 to July 30, 2004.
See Qingdao Xinghua Group Co., Ltd.
Verification Report, September 3, 2004
(“Xinghua Verification Report").

The Department submitted its
verification outline to Xinghua on June
24, 2004, approximately one month
prior tc the commencement of
verification, thereby giving Xinghua
sufficient time to prepare for
verification. See Xinghua’s Verification
Outline, dated June 24, 2004 (“Xinghua
Verification Outline”). The purpose of
submitting a verification outline in
advance of verification is to give
respondents sufficient notice about the
types of source documents that the
Department will seek to examine during
verification, and to afford respondents
sufficient time to compile source
documents requested in the verification
outline. As noted below, Xinghua failed
to follow the instructions detailed in the
Department's verification outline and
failed to present source documents in a
timely manner for verification. At no
time prior to verification did Xinghua
contact the Department with questions
about verification procedures,
docuraents to prepare for verification, or
the verification outline.

Xinghua was unprepared for
verification and its unpreparedness
significantly impeded the verification



PART I: INTRODUCTION

BACKGROUND

This investigation results from a petition filed on November 13, 2003, by Gleason Industrial
Products, Inc. (“Gleason”) of Los Angeles, CA, alleging that an industry in the United States is
materially injured and threatened with material injury by reason of less-than-fair-value (“LTFV”) imports
of hand trucks and certain parts thereof from China.! On December 1, 2003, Gleason filed an amendment
to the petition to include Precision Products, Inc., Lincoln, IL, as a co-petitioner.? Information relating to
the background of this investigation is provided below.’

Effective Date Action

November 13, 2003 . Petition filed with Commerce and the Commission; institution of
Commission investigation

December 9, 2003 .. Commerce’s notice of initiation

December 29, 2003 . Commission’s preliminary determination

May 24, 2004 ...... Commerce’s preliminary determination; scheduling of final phase of

Commission investigation (69 F.R. 32042, June 8, 2004)

October 7, 2004 .... Commission’s hearing*

October 14, 2004 ... Commerce’s final determination (69 F.R. 60980, October 14, 2004)*
November 10, 2004 . Commission’s vote

November 23, 2004 . Commission determination transmitted to Commerce

' A complete description of the imported products subject to this investigation is presented in The Product section
of this part of the report. The merchandise subject to this investigation is classified in the Harmonized Tariff.
Schedule of the United States (HTSUS) in subheading 8716.80.50 and imported under statistical reporting number
8716.80.5010 (“industrial hand trucks”), although it also may be imported under statistical reporting number
8716.80.5090. In addition, hand truck parts typically are imported under statistical reporting number 8716.90.5060.
The normal trade relations tariff rate imposed on this product is 3.2 percent ad valorem, applicable to imports from
China; this rate was not reduced as a result of the Uruguay Round of Trade Negotiations.

? Gleason and Precision Products are both members of the Gleason Group of companies. Gleason manufactures
and sells hand trucks. Precision Products also manufactures hand trucks, but sells all of its hand trucks through
Gleason.

> Federal Register notices cited in the tabulation are presented in app. A.
* A list of witnesses appearing at the hearing is presented in app. B.

> On October 13, 2004, Commerce notified the Commission of its final affirmative determination and final LTFV
margins:
True Potential, 24.90 percent;
Taifa, 27.00 percent;
Future Tool, 30.56 percent;
Shandong, 30.56 percent;
Huatian, 45.04 percent;
Xinghua, 386.75 percent; and
all others, 386.75 percent.


states that the hand truck industry is based on a mature manufacturing technology in which innovations
can be quickly copied by competitors.*!

Nonsubject imports hold only a small share of the U.S. market for finished hand trucks, ranging
from *** percent to *** percent of apparent U.S. consumption measured by quantity over the period
examined.*? Measured by value, nonsubject finished hand trucks and nonsubject hand truck parts also
had a small share of the U.S. market, ranging from *** percent to *** percent of apparent U.S.
consumption.

Cc. Interchangeability Considerations

We find that there is a moderate to high level of interchangeability between the domestic product
and subject imports. A majority of the producers, importers, and purchasers responding to the
Commission’s questionnaire reported that the domestic product and subject imports can always or
frequently be used interchangeably, although a few market participants differed on this issue.**

We further find that the interchangeability between subject imports and the domestic product
translates into direct competition for sales of general-use hand trucks at national home improvement
stores, club warehouses and other major retailers. Gleason maintains that general-purpose commodity
hand-trucks constitute about 95 percent of market sales in the U.S. market, and specialty hand trucks five
percent. It argues that there is direct competition between the domestic product and subject imports for
sales of the commodity hand trucks to the domestic industry’s largest customers, namely the home
improvement stores. The record reflects that big box retailers tend to sell general-use hand trucks.
Furthermore, Chinese suppliers have competed directly in line reviews and for sales to Home Depot and
Lowe’s.® Other major retailers have confirmed lost sales and revenues, further corroborating direct
competition between domestic producers and Chinese suppliers of hand trucks.*’

D. Pricing Considerations

Gleason and Respondent LDI disagree as to the importance of price in this industry. Gleason
argues that price is the driving factor in purchasing decisions in this industry, and that the lower prices
demanded by the big box retailers affect prices throughout the market."* Respondent LDI argues that
quality, not price, is the most important factor in purchasing hand trucks, and that some importers and

*(__ continued)
data reflect that ***, and as stated earlier, *** is by far the dominant domestic hand truck producer. CR at VI-10; PR
at VI-4.

5! Gleason Prehearing Brief at 16-17.

© CR/PR at Table IV-3.

® CRV/PR at Table IV-10.

* CR at II-8-9; PR at II-5-6 & Table II-3. Gleason maintains, consistent with our purchaser data, that market
participants largely agree that domestically produced hand trucks and subject imports can be used in the same
applications. Gleason Prehearing Brief at 14.

§5 Gleason Prehearing Brief at 10-15.

% Tr. at 33-34, 88. CR at V-27, n.17; PR at V-9, n.17. Chinese suppliers have also competed against domestic
producers for sales to catalog/industrial distributor purchaser *** who sells ***.

*” CR at V-23-29; PR at V-7-9.

*§ Gleason Prehearing Brief at 7-8, 13-14. Gleason cites to *** questionnaire response, in which *** reported
that it *** its domestic purchases of hand trucks due to ***, and *** its purchases of subject imports due to ***.
Gleason Posthearing Brief at 3.

13


Table IV-2
Finished hand trucks: U.S. producers’ U.S. shipments, U.S. imports, by sources, and apparent
U.S. consumption, 2001-03, January-June 2003, and January-June 2004

Calendar year January-June
Item 2001 2002 2003 2003 2004
Quantity (units)
U.S. producers’ U.S. shipments’ 1,468,849] 1,425,093] 1,467,009 763,374 720,296
U.S. imports from--
China 650,172 937,851] 1,346,305 675,556 678,309
Nonsubject countries 63,912 131,700 66,251 37,649 92,337
All countries 714,084 | 1,069,551] 1,412,556 713,205 770,646
Apparent U.S. consumption 2,182,933 | 2,494,644] 2,879,565] 1,476,579] 1,490,942
Value (1,000 dollars)
U.S. producers’ U.S. shipments' 53,989 53,146 53,407 27,737 26,345
U.S. imports? from--
China 9,622 14,839 21,366 10,480 13,562
Nonsubject countries 4,052 4,712 4,047 2,276 1,862
All countries 13,673 19,551 25,413 12,757 15,424
Apparent U.S. consumption 67,662 72,697 78,820 40,493 41,770
‘U.S. producers reported no internal consumption or company transfers of hand trucks.
? Landed, duty-paid.
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
Statistics.

U.S. IMPORTS OF PARTS

U.S. imports of hand truck parts are presented in table TV-5.5° China is the largest exporter of
hand truck parts to the United States, accounting for *** percent of the value of imports of components
(frames, handling areas, and toe plates) in 2003.’ China is the second largest exporter of unassembled
hand truck kits to the United States, accounting for *** percent of the value of imports.*

* Imports of hand truck parts are based on Commission questionnaires. Hand truck parts are imported under
statistical reporting number 8716.90.5060, a basket category.

° Data for components and for kits (which comprise multiple components) are presented separately. Such data are
consolidated in app. C.

7 Canada was the other exporter of hand truck parts to the United States in 2003.
* Malaysia and Thailand were the other exporters of unassembled hand truck kits to the United States in 2003.

IV-3








Federal Register/Vol. 69, No. 198/Thursday, October 14, 2004/ Notices

60981

Inc. (collectively the “‘petitioners”))
submitted their reply comments.

On September 10, 2004, the
petitioners and their counsel submitted
on the record affidavits pertaining to
“certain information revealed in and
corroborated by” the Department's
verification of Taifa. On September 16,
2004, the Department rejected that
submission as untimely, unsolicited
new factual information.

We received comments from
interested parties on the Preliminary
Determination. On September 10, 2004,
we received case briefs from the
petitioners, Huatian, Taifa, True
Potential, and Zhenhua Industrial
Group Co., Ltd. (“Zhenhua”), and on
September 15, 2004, rebuttal briefs from
the petitioners, Huatian, Qingdao Future
Tool Inc. (“Future Tool”), Taifa, and
True Potential. On September 17, 2004,
the Department identified certain
information in the petitioners’
September 10, 2004, case brief as
untimely, unsolicited new factual
information. As a result, the Department
rejected the petitioners’ September 10,
2004, case brief in its entirety, and
requested the petitioners to revise and
resubmit their case brief without the
new factual content. The petitioners
resubmitted their case brief on
September 21, 2004. The Department
held a public hearing on September 17,
2004, at the request of the petitioners,
Huatian, Taifa, True Potential, Xinghua,
and Zieahua.

Scope of the Investigation

For the purpose of this investigation,
the product covered consists of hand
trucks manufactured from any material,
whether assembled or unassembled,
complete or incomplete, suitable for any
use, and certain parts thereof, namely
the vertical frame, the handling area and
the projecting edges or toe plate, and
any combination thereof.

A complete or fully assembled hand
truck is a hand-propolled barrow
consisting of a vertically disposed frame
having a handle or more than one
handle at or near the upper section of
the vertical frame; at least two wheels at
or near the lower section of the vertical
frame; and a horizontal projecting edge
or edges, or toe plate, perpendicular or
angled to the vertical frame, at or near
the lower section of the vertical frame.
The projecting edge or edges, or toe
plate, slides under a load for purposes
of lifting and/or moving the load.

That the vertical frame can be
converted from a vertical setting to a
horizontal setting, then operated in that
horizontal setting as a platform, is not
a basis for exclusion of the hand truck
from the scope of this petition. That the

vertical frame, handling area, wheels,
projecting edges or other parts of the
hand truck can be collapsed or folded is
not a basis for exclusion of the hand
truck from the scope of the petition.
That other wheels may be connected to
the vertical frame, handling area,
projecting edges, or other parts of the
hand truck, in addition to the two or
more wheels located at or near the lower
section of the vertical frame, is not a
basis for exclusion of the hand truck
from the scope of the petition. Finally,
that the hand truck may exhibit physical
characteristics in addition to the vertical
frame, the handling area, the projecting
edges or toe plate, and the two wheels
at or near the lower section of the
vertical frame, is not a basis for
exclusion of the hand truck from the
scope of the petition.

Examples of names commonly used to
reference hand trucks are hand truck,
convertible hand truck, appliance hand
truck, cylinder hand truck, bag truck,
dolly, or hand trolley. They are typically
imported under heading 8716.80.50.10
of the Harmonized Tariff Schedule of
the United States (“HTSUS”), although
they may also be imported under
heading 8716.80.50.90. Specific parts of
a hand truck, namely the vertical frame,
the handling area and the projecting
edges or toe plate, or any combination
thereof, are typically imported under
heading 8716.90.50.60 of the HTSUS.
Although the HTSUS subheadings are
provided for convenience and customs
purposes, the Department's written
description of the scope is dispositive.

Excluded from the scope are small
two-wheel or four-wheel utility carts
specifically designed for carrying loads
like personal bags or luggage in which
the frame is made from telescoping
tubular material measuring less than %
inch in diameter; hand trucks that use
motorized operations either to move the
hand truck from one location to the next
or to assist in the lifting of items placed
on the hand truck; vertical carriers
designed specifically to transport golf
bags; and wheels and tires used in the
manufacture of hand trucks.

Scope Comments

The Departmont received scope
exclusion/clarification comments from
ten parties requesting that the
Department determine whether certain
products produced by these parties are
covered by the scope of the
investigation. The Department has
addressed these requests in the
following memoranda: “Scope
Exclusion/Clarification Requests:
Angelus Manufacturing; Custom Carts
LLG; Illinois Tool Works, Inc.; Qingdao
Huatian Hand Truck Co., Ltd; WelCom

Products Inc.; and LL King Corporation”
from Susan Kuhbach to Jeffrey May
(September 3, 2004) and “Scope
Exclusion/Clarification Requests: Alton
Industries, Inc.; Safco Products
Company; A. J. Wholesale Distributors,
Inc.; and Wilmar Corporation” from
Susan Kuhbach to Jeffrey May (October
6, 2004). On September 27, 2004, Total
Trolley, LLC requested that its
horizontal trolley be excluded from the
scope of this investigation. We did not
receive this request in time for the final
determination. Therefore, we will
address this scope request after the final
determination.

Period of Investigation

The period of investigation (“POI”) is
April 1, 2003, through September 30,
2003, which corresponds to the two
most recent fiscal quarters prior to the
month of the filing of the petition (i.e.,
November 2003).

Nonmarket Economy Status for the PRC

The Department has treated the PRC
as a nonmarket economy (“NME")
country in all past antidumping
investigations. See, e.g., Final
Determination of Sales at Less Than
Fair Value and Critical Circumstances:
Certain Malleable Iron Pipe Fittings
From the People’s Republic of China, 68
FR 61335, 61396 (Oct. 28, 2003). A
designation as an NME remains in effect
until it is revoked by the Department.
See section 771(18)(C) of the Act. No
party in this investigation has requested
a revocation of the PRC’s NME status.
Therefore, we have continued to treat
the PRC as an NME in this investigation.
For further details, see Preliminary
Determination, 69 FR at 29511.

Separate Rates

In our Preliminary Determination, we
found that Huatian, Taifa, True
Potential, Xinghua, Future Tool and
Shandong Machinery Import & Export
Group Corp. (“Shandong”) met the
criteria for receiving separate
antidumping rates. See Preliminary
Determination, 69 FR at 29511-29512.
The petitioners have requested that the
Department deny separate rates to these
companies and apply the PRC-wide rate
to all exporters of the subject
merchandise. As explained in
Comments 13 through 16 of the October
6, 2004, Issues and Decision
Memorandum for the Antidumping Duty
Investigation of Hand Trucks and
Certain Parts Thereof from the People's
Republic of China; Final Determination
(“Decision Memorandum”), we
continue to find that each of these
exporters should be assigned an
individual dumping margin because the


Interchangeability and Customer and Producer Perceptions

According to the petitioner, all hand trucks are generally interchangeable, although hand trucks
designed for general tasks work less efficiently on specialized tasks than the hand trucks designed for
specialized tasks, and vice versa. The petitioner also maintains there are no practical dividing lines
between hand trucks manufactured from different raw materials; for example, hand trucks manufactured
from steel, aluminum, or nylon are completely interchangeable for general tasks.

Respondents contend that there is little direct competition between imports of hand trucks from
China and the domestic like product. Hand trucks from China are generally low-priced models sold
primarily to individuals whereas domestically produced hand trucks are more expensive and sold
primarily to businesses and industrial users. Respondents also argue that they have redesigned their
hand trucks to include better ergonomics, new wheel design and technology, folding and collapsible
features, small and lighter weight designs, anti-skid decks, and color choices that enhance safety
standards.”* In contrast, they assert, the largest domestic producer has not modified its product or its
sales practices to meet the needs of the market.”

Channels of Distribution

The petitioner reported that hand trucks cannot be differentiated by channels of distribution.
Hand trucks are sold primarily to national home improvement stores, hardware stores, catalog houses and
industrial supply distributors, and other customers. However, the home improvement channel, comprised
mostly of big box retailers selling primarily to do-it-yourself customers, has the most impact on the
industry.”” National home improvement stores and hardware stores generally purchase certain models of
general-task hand trucks and convertible hand trucks in high volumes. Catalog houses and industrial
distributors similarly purchase not only general-task hand trucks and convertible hand trucks, but also
hand trucks built for specialized purposes (for example, cylinder hand trucks, barrel hand trucks, and
drum hand trucks), often in smaller volumes.”*

Respondents have identified three main types of customers -- residential, industrial, and
office/small business.” The residential channel would include so-called “big box” home improvement
stores as well as wholesale club stores. Because of their size and national presence, these stores have the
buying power to purchase hand trucks at the lowest prices. The industrial sector sells hand trucks to
factories and industry professionals such as those in the healthcare, hospitality, and other commercial
industries. The office supply/small business channel would include national office supply stores as well
as certain mail-order dealers that market almost exclusively to offices and small businesses.*°
Respondents describe the special requirements for this channel as electronic order processing, fill rates,
precise processing and delivery schedules, special packaging, and pallet requirements.*'

* Conference transcript, pp. 88-89 (Murphy).
?5 Hearing transcript, p. 156 (LaFontaine); letter from Alton Industries, Inc., October 21, 2004.

*° Liberty Diversified prehearing brief, p. 4. Representatives of Gleason, Harper, and Magline disputed this
characterization. Hearing transcript, pp. 40-49 (Kvasnicka, Rife, and Straw).

*” Gleason prehearing brief, p. 9; hearing transcript, pp. 20-12 (Simon).
8 Hearing transcript, pp. 64-65 (Rife, Simon) and p. 74 (Simon).

® Liberty Diversified prehearing brief, pp. 1-2.

°° Hearing transcript, pp.153-154 (LaFontaine).

*! Hearing transcript, p. 155 (LaFontaine).




Table |-2
Hand truck parts: U.S. producers’ and importers’ commercial U.S. shipments, by channels of
distribution, 2001-03, January-June 2003, and January-June 2004

* * * * * * *

Table 1-3
Unassembled hand trucks (kits): U.S. producers’ and importers’ commercial U.S. shipments, by
channels of distribution, 2001-03, January-June 2003, and January-June 2004

* * * * * * *

19