[Federal Register Volume 77, Number 10 (Tuesday, January 17, 2012)]
[Notices]
[Pages 2269-2270]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2012-728]


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DEPARTMENT OF COMMERCE

Foreign-Trade Zones Board

[Docket 3-2012]


Foreign-Trade Zone 18--San Jose, CA, Application for Subzone, 
Tesla Motors, Inc. (Electric Passenger Vehicles), Palo Alto and 
Fremont, CA

    An application has been submitted to the Foreign-Trade Zones Board 
(the Board) by the City of San Jose, California, grantee of FTZ 18, 
requesting special purpose subzone status for the electric passenger-
vehicle manufacturing facilities of Tesla Motors, Inc. (Tesla), located 
in Palo Alto and Fremont, California. The application was submitted 
pursuant to the provisions of the Foreign-Trade Zones Act, as amended 
(19 U.S.C. 81a-81u), and the regulations of the Board (15 CFR part 
400). It was formally filed on January 10, 2012.
    The Tesla facilities (currently employing over 1,000 workers) 
consist of two sites: Site 1 (25.2 acres)--corporate headquarters, 
research and development, and manufacturing plant, located at 3500 Deer 
Creek Road, Palo Alto, California; and, Site 2 (210 acres)--
manufacturing plant, located at 45550 Fremont Boulevard, Fremont, 
California. The facilities are used to manufacture electric passenger 
vehicles and related components, including battery packs, powertrain 
systems, and electronic modules (up to 200,000 units of each per year) 
for commercial sale. Components and materials sourced from abroad 
(representing 16 to 55% of the value of the finished products) include: 
Oils, greases, fluids, refrigerants, adhesives, sealants, anti-freeze/
coolants, alcohols, plastic tubes/pipes/hoses/

[[Page 2270]]

fittings, foam tape/sheets/film, decals/ballotini, labels, knobs, 
handles, motors, pump parts, mechanical seals, plastic o-rings/clips, 
rubber o-rings/seals/grommets/washers/bushings and hoses, windshield 
wiper blades, floor mats, mirrors, glass, windshields and related trim 
pieces, shafts, flanges, base metal mountings, locks, motor and shaft 
couplings, pumps, compressors, body moldings and trim, latches, HVAC 
components, blower motors, valves, fasteners, electric motors, lithium-
ion batteries, electrical assemblies, lamps and lighting equipment, 
electronic components, antennas, sensors, control modules, cables, 
switches, wiring harnesses, audio/video systems, loudspeakers, body 
panels, suspension components, shock absorbers, anti-roll bars, 
subframes assemblies, steering gear, carpet sets, interior trim, 
consoles, instruments, brake systems and parts, electric powertrain 
components, road wheels, tires, couplings, shafts, seats, coatings, 
paints, and pedals (duty rates range from free to 8.5%, 1.3[cent]/
kg+5.7%).
    FTZ procedures could exempt Tesla from customs duty payments on the 
foreign components used in export production. The company anticipates 
that 40 to 65 percent of the facilities' shipments will be exported. On 
its domestic sales, Tesla would be able to choose the duty rates during 
customs entry procedures that apply to finished electric passenger 
vehicles, battery packs, powertrain components, and electronic modules 
(free-3.4%) for the foreign inputs noted above. FTZ designation would 
further allow Tesla to realize logistical benefits through the use of 
weekly customs entry procedures. Customs duties also could possibly be 
deferred or reduced on foreign status production equipment. Tesla would 
also be exempt from duty payments on foreign inputs that become scrap 
during the production process. The request indicates that the savings 
from FTZ procedures would help improve the facilities' international 
competitiveness.
    In accordance with the Board's regulations, Pierre Duy of the FTZ 
Staff is designated examiner to evaluate and analyze the facts and 
information presented in the application and case record and to report 
findings and recommendations to the Board.
    Public comment is invited from interested parties. Submissions 
(original and 3 copies) shall be addressed to the Board's Executive 
Secretary at the address below. The closing period for their receipt is 
March 19, 2012. Rebuttal comments in response to material submitted 
during the foregoing period may be submitted during the subsequent 15-
day period to April 2, 2012.
    A copy of the application will be available for public inspection 
at the Office of the Executive Secretary, Foreign-Trade Zones Board, 
Room 2111, U.S. Department of Commerce, 1401 Constitution Avenue NW., 
Washington, DC 20230-0002, and in the ``Reading Room'' section of the 
Board's Web site, which is accessible via www.trade.gov/ftz.
    For further information, contact Pierre Duy at <a href="/cdn-cgi/l/email-protection#53033a362121367d17262a1327213237367d343c25"><span class="__cf_email__" data-cfemail="f3a39a96818196ddb7868ab38781929796dd949c85">[email protected]</span></a> 
or (202) 482-1378.

    Dated: January 10, 2012.
Andrew McGilvray,
Executive Secretary.
[FR Doc. 2012-728 Filed 1-13-12; 8:45 am]
BILLING CODE P


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