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Public Version of BCI

The product is a gray iron counterweight casting utilized on vehicles in the Forklift Truck industry with

dimensions of LWH 37 x 51 x 46 inches and a weight of 6838 lbs. The product is painted with yellow

primer. EQI’s part number for this product is [ ]. Gray iron counterweight castings are produced

using a Vacuum Molding process from Class 20 Gray Iron (ASTM A48), as described in the comments

attached to this submission.

8431200000

Phillips, Blake

EQI, Ltd.

Teresa Polino, Arent Fox LLP

Importer

YES

Public Version of BCI
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NO

NO

[ ] [ ] MT

[ ] [ ] MT

[ ] [ ] MT

See attached for arguments in support of this request. U.S. Customs and Border Protection will be

able to administer this exclusion request based on the following information:

• The description on the Commercial Invoice from EQI’s Chinese suppliers reads “Origin China,

Counterweight” and includes the part number listed above. The part number is also printed on the

packing list and on the counterweight itself.

• Bills of Lading from EQI’s Freight Forwarder lists the description as “Counterweight” and

references the HTSUS code 84312000

• The product is painted with yellow primer. Pictures of the loaded counterweight castings and/or

container for this specific part number are included on the following page:

5797 Harvey St., Suite D, Norton Shores, Michigan 49444 T 616/850-2630 F 231/798-3724

AFDOCS/16668192.1

September 11, 2018

VIA REGULATIONS.GOV PUBLIC VERSION

The Honorable Robert E. Lighthizer Docket No. USTR-2018-0025

U.S. Trade Representative 

Office of the U.S. Trade Representative

600 17th Street, NW, Room F516

Washington, D.C., 20006

Re: Request for Exclusion of Gray Iron Counterweight Castings Classified under HTS 

8431.20.0000 from the Determination of Action Pursuant to Section 301

Dear Ambassador Lighthizer:

EQI, Ltd. (EQI) respectfully submits this request for exclusion of gray iron counterweight 

castings from the proposed determination of action pursuant to Section 301 of the Trade Act of 

1974.1 In accordance with the USTR’s instructions, we respectfully request that certain 

information contained in this submission, identified by brackets, be afforded business 

confidential treatment.2 The undersigned certifies that disclosure of the information identified in 

brackets in the confidential version of this submission would endanger the trade secrets and 

profitability of EQI and would not customarily be released to the public.

Established in 2004, EQI provides tailored Design, Engineering, Procurement, and 

1 19 U.S.C. § 2411. 

2 Procedures To Consider Requests for Exclusion of Particular Products From the 

Determination of Action Pursuant to Section 301: China’s Acts, Policies, and Practices Related 

to Technology Transfer, Intellectual Property, and Innovation, 83 Fed. Reg. 32,181, 32,183-84

(USTR July 11, 2018) (“Procedures To Consider Requests for Exclusion”).
PUBLIC VERSION Page 2

Logistics services to a broad base of U.S. Original Equipment Manufacturers (OEMs) in the 

heavy equipment and industrial markets. EQI is headquartered in Norton Shores, Michigan and 

currently employs 28 salaried and fully benefited engineers, quality, sales, finance, customer 

service, and operations personnel. 

EQI primarily sells gray and ductile iron, steel, and aluminum castings. This exclusion 

request addresses gray iron counterweight castings imported from China under HTSUS 

subheading 8431.20.00, which are currently subject to the 25% additional Section 301 tariff. A 

full description, including the end-use, dimensions, and weight, as well as the ability of U.S. 

Customs and Border Protection to administer this exclusion, is provided in the attached Section 

301 Investigation Form to Request Exclusion of Product. Please note that a separate Form has 

been submitted for each unique part number for which EQI is requesting an exclusion. 

In accordance with the procedures released by the Office of the United States Trade 

Representative (USTR),3 EQI provides the following information requested by the USTR in 

support of this request. 

1. A complete and detailed description of the product of concern

As noted above, we have filed a separate Section 301 Investigation Form to Request 

Exclusion of Product for each part number for which we are requesting an exclusion. The 

specific details, including the dimensions and chemical composition unique to each part number, 

are included in the exclusion request form for that part number accompanying this attachment. A 

detailed description of the chemical composition and production produces for all counterweight 

castings classified under HTSUS 8431.20.0000 is also provided below. 

3 Procedures To Consider Requests for Exclusion, 83 Fed. Reg. at 32,182-83.
PUBLIC VERSION Page 3

Gray iron counterweight castings classified under HTSUS 8421.20.0000 are utilized on

vehicles in the material handling and aerial work platform industries. The photos below provide 

examples of the counterweights imported under this classification. A photo of the specific 

counterweight that is the subject of this request subject is pictured above.

Figure 1: Figure 2:

The product is produced using a unique process called the Vacuum Molding process (or 

V-Process). This production method employs a sand mold that contains no moisture or binders. 

The internal cavity of the mold holds the shape of the casting due to forces exerted by the 

pressure of a vacuum. The molten iron is poured into the cavity in the mold, solidifies, and the 

vacuum is released. The V-Process is efficient as the sand can be re-used multiple times with 

minimal post-cast processing. Significant cost savings stem from the absence of resin used as a 

binder to create the mold. The process was invented in Asia, and to a large extent, remains there. 

Gray iron counterweight castings are made from Class 20 Gray Iron (ASTM A48) of the 

following properties and chemical composition:
PUBLIC VERSION Page 4

Table 1: Properties of ASTM A48 Class 20 Gray Iron

Table 2: Chemical Composition of ASTM A48 Class 20 Gray Iron

Counterweights range in size depending upon application and can weigh up to several 

thousand pounds for larger equipment. Most gray iron counterweight castings are imported into 

the U.S. in a semi-finished state, which would include the base iron casting, with some amount 

of machining, coated with either an auto-body type filler material and/or primer/finish paint. 

2. The ability of US Customs and Border Protection (CBP) to administer the exclusion 

As noted above, we have filed a separate Section 301 Investigation Form to Request 

Exclusion of Product for each part number for which we are requesting an exclusion. The 

specific details on the ability of CBP to administer each separate exclusion, including 

photographs of the unique product at shipment, are included in the exclusion request form for the 

part number accompanying this attachment. A more general description applicable to all 

counterweight castings classified under HTSUS 8431.20.0000 is also provided below. 

Counterweight castings imported by EQI from China are shipped via ocean freight from 

several Chinese ports to the United States in Full Container Loads (FCL). Each 20’ shipping 

container is filled with a one single EQI customer part number. The castings themselves are 

Class Tensile

strength 

Compressive

strength 

Tensile 

modulus E

20 22 ksi 83 ksi 10 Mpsi

Component Elements % Composition

Carbon, C 3.25 - 3.5 %

Copper, Cu 0.15 - 0.40 %

Iron, Fe 91.9 - 94.2 %

Manganese, Mn 0.50 - 0.90 %

Silicon, Si 1.8 - 2.3 %

Other elements (Cr, S, Moly, etc) Balance
PUBLIC VERSION Page 5

mounted on custom fabricated shipping racks and are marked with EQI customer part number, 

place of manufacture, manufacture date, and should this exclusion request be granted, the 

HTSUS code 8431.20.00. The counterweight castings themselves range in size from 12” to over 

7’ in length and up to 4’ in height. Counterweights, depending on their design and intended use 

can weigh as little as 100lbs to well in excess of several metric tons. EQI’s counterweight 

castings are either painted a primer black or a light primer yellow in color, depending upon 

customer specifications. The description on the Commercial invoice from EQI’s Chinese 

suppliers reads “Origin China, Counterweight”. Bills of Lading from EQI’s Freight Forwarder 

lists the description simply as “Counterweight” or “Counterweight for Fork-Lift Truck” and 

further references the HTSUS code 8431.20.00.

3. Availability of the product outside of China, i.e. whether the particular product 

and/or a comparable product is available from sources in the United States and/or 

in third countries;

There is no alternative source of gray iron counterweight castings in the quantity and 

tonnage EQI requires outside of China. Gray iron counterweight castings are unavailable in 

United States or other third countries at the scale necessary to supply U.S. demand. During the 

late 1990s, production capacity and capability to make gray iron counterweight castings shifted 

offshore as foundries in the United States were converted to manufacture higher complexity 

castings, often from other metals, or shuttered completely. According to industry experts, it is 

estimated that over 75% of the global capacity to produce gray iron counterweight castings now 

resides in China, with only one capable counterweight foundry remaining in operation in the 

U.S. The sole U.S. foundry, North Vernon Industry Corporation (NVIC), is wholly owned, 

operated, and subsidized by Toyota for the manufacture of its own gray iron counterweight 

castings for Toyota branded lift trucks. This Toyota facility is neither capable, nor willing, to 
PUBLIC VERSION Page 6

support the several hundred thousand metric tons of counterweight demand required by the 

sizeable U.S.-based OEM production base for this equipment. Alternatives to the vacuum 

molding casting process exist in the United States for iron castings, but there is not sufficient 

capacity to domestically produce the quantity required by the U.S. market.

Since the large majority of global counterweight production resides in China, U.S. OEMs 

manufacturing lift trucks and aerial work platforms, who depend on a consistent and reliable 

supply of gray iron counterweight castings, have no other viable large-scale option from where 

they can source counterweights other than China. As mentioned previously, domestic V-Process 

casting capacity outside of NVIC does not exist. Other global sourcing opportunities (in India, 

SE Asia, and even Europe) are either inadequately sized to meet US demand or too immature to 

be capable, even at lower tonnages, to supply U.S. OEMs for several years, if at all. 

Specifically, EQI has partnered with its Chinese suppliers since its formation in 2004 and 

has invested significant time, energy, and effort in developing strategic relationships to meet the 

demanding qualifications of U.S. OEM customers. EQI operates a wholly owned foreign 

enterprise in China that employs over 45 workers who monitor foundry suppliers and work to 

develop their capabilities, processes, and monitor production. EQI engages with suppliers 

constantly on training and foundry development initiatives, including LEAN manufacturing 

techniques, foundry process control, metallurgy, dimensional inspection techniques, tooling and 

fixturing, and gating design. As a result, EQI’s suppliers produce exactly what U.S. customers 

require, thus allowing EQI to best meet the needs of their customers. 

Developing the qualified suppliers necessary to provide gray iron counterweight castings 

suitable for EQI’s OEM customers requires substantial time and resources. For example, [
PUBLIC VERSION Page 7

]. 

In short, gray iron counterweight castings in the quantity and tonnage required by the 

U.S. market are only available in China. Moreover, there is no reasonable alternative or 

“comparable product” that can be used as a substitute for gray iron counterweight castings that 

will meet stringent safety, quality, aesthetic, and usability requirements of U.S. OEMs. These 

castings are not optional equipment for the vehicles produced by U.S. heavy equipment OEMs. 

Gray iron counterweight castings are required to safely and efficiently operate this equipment 

and to fulfill its intended use. 

4. Whether the imposition of additional duties on the particular product would cause 

severe economic harm to the requester or other US interests

The imposition of a 25% tariff on gray iron counterweight castings causes severe 

economic harm to EQI and other U.S. interests, including EQI’s OEM customers, which employ 

thousands of Americans in the Midwest and mid-Atlantic regions, centers of U.S. production that 

depend on a reliable supply of gray iron counterweight castings. 

As previously mentioned, EQI’s business in Norton Shores, Michigan provides 28 

salaried and fully benefited jobs. The increased duties will ultimately result in declining revenue, 

market contraction, and eventually layoffs at EQI’s Michigan offices. Moreover, following 

importation, gray iron counterweight castings are further processed and finished in the United 

States at EQI’s domestic supply chain partners in Pennsylvania, Kentucky, Virginia, Iowa, 

Indiana, and Illinois before being sold. The 25% tariff will have a negative downstream impact 
PUBLIC VERSION Page 8

on these U.S. companies, many of which, like EQI, are small- and medium-size businesses, 

reducing their sales, profitability, employment outlook, production output, capital spending, and 

investment plans.

Gray iron counterweight castings are sold to customers in the material handling and aerial 

work platform industries, which each provide hundreds of additional manufacturing jobs. In 

2017, EQI delivered nearly [ ] of castings to its customers in the United States, 

including Crown Equipment Corporation, Gradall Industries Inc., Hyster-Yale Group, Inc., and 

JLG Industries, Inc. EQI’s OEM customer base employs approximately 30,000 Americans 

domestically in regions that need high quality manufacturing jobs. This number does not include 

the larger and more impactful number of employees working for the OEM’s Tier one and other 

sub-Tier suppliers who supply domestically produced equipment. As detailed in the letters of 

support from our customers, included as Exhibit 1 to this exclusion request, the impact of the 

25% tariff on gray iron counterweight castings will ultimately be economic contraction 

throughout the supply chain, resulting in fewer Americans working in these high-quality 

manufacturing jobs. 

The 25% tariff on gray iron counterweight castings has led to dramatic increases in EQI’s 

prices from its supply chain partners, forcing us to, in turn, increase prices to our OEM 

customers. [

]. It remains to be seen whether our 

customers will absorb the cost increase themselves, threatening their continued profitability and 
PUBLIC VERSION Page 9

operations, or pass this increase along to their end customers, negatively impacting American 

consumers. 

An exclusion for gray iron counterweight castings from the 25% Section 301 tariff will 

benefit U.S. interests, including the long-term viability of EQI, its OEM customers, and centers 

of U.S. manufacturing in the mid-Atlantic and mid-Western regions that depend on a reliable 

supply of gray iron counterweight castings for their material handling and aerial work platform 

equipment.

5. Whether the particular product is strategically important or related to “Made in 

China 2025” or other Chinese industrial programs

Gray iron counterweight castings are neither strategically important, nor related to “Made 

in China 2025” or any other Chinese industrial program. While gray iron counterweight castings 

are themselves critical, they are ultimately a commodity product and the technology required to 

produce them has no bearing on any existing U.S. – China technology dispute or claim. 

If the purpose of the Section 301 tariff is to change China’s behavior regarding 

intellectual property and technology transfer, the current tariff on gray iron counterweight

castings is a misguided and completely unrelated product category to achieve those objectives. 

EQI’s relationships with many of its Chinese suppliers span more than 14 years since EQI’s 

inception in 2004. While EQI has developed strategic relationships with its suppliers, it 

maintains no ownership in Chinese foundries and does not purchase capital equipment or raw 

materials for their exclusive use. There is no relevant intellectual property associated with these 

commodity products and EQI has never been asked nor required by the Chinese government or 

any other non-governmental Chinese organization to provide any assistance that would not itself 

benefit EQI or its customers. Indeed, rather than transfer technology, where Chinese machinery 
PUBLIC VERSION Page 10

or inputs have been inferior, EQI has arranged for those materials to be sourced from the United 

States. [ 

].

Moreover, the 25% tariff will not protect, grow, or otherwise change the domestic 

foundry industry as it relates to gray iron counterweight castings. Given the large capital 

investment required and small profit margin for gray iron counterweight castings, new 

counterweight foundry capacity is not being built in the U.S. and likely never will be. The return 

on investment is simply too long and the margin on this commodity product too narrow to justify 

the expense. The likelihood that major capital investments will be made based solely on the 

benefit that the tariff might provide to the domestic foundry industry is virtually zero, as any 

tariff can easily be reversed in the future by a subsequent administration.

Finally, as detailed above, the imposition of a 25% tariff on gray iron counterweight 

castings does not serve Section 301’s stated purpose of eliminating China’s discriminatory acts, 

policies, and practices. Because gray iron counterweight castings are only available from China, 

U.S. OEMs have no choice but to continue to make purchases from the China-based supply 

chain. A tariff on this product will not drive changes in Chinese trade behavior or the purchasing 

patterns of U.S. OEM consumers; gray iron counterweight castings will continue to be purchased 

in China regardless of the tariff, which simply functions as a penalty tax on U.S. manufacturers 

who require counterweights for their products.

We appreciate the Department’s consideration of this exclusion request. Please contact 

the undersigned if you have any questions regarding this submission. 

I hereby certify that the information provided is complete and correct to the best of my 
PUBLIC VERSION Page 11

knowledge.

Respectfully submitted,

Blake Phillips

President and CEO

EQI, Ltd. 
 Exhibit 1