DIAL MANUFACTURING, INC.

25 South 51st Avenue 

Phoenix, Arizona 85043-3711

(602) 278-1100  (800) 350-3425

1

The Honorable Robert Lighthizer

United States Trade Representative

Office of the United States Trade Representative

600 17th ST. NW

Washington, D.C. 20508

Re: USTR-2018-0025 – 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

Dear Ambassador Lighthizer:

We at Dial Manufacturing, Inc. (“Dial”) respectfully request that our evaporative cooler pumps be

excluded from Section 301 tariffs imposed on products imported from China. We are submitting this letter 

pursuant to Question 11 of our Form to Request Exclusion of Product and Section B of the Federal Register 

notice1 detailing the process for requesting a product exclusion from the Section 301 tariffs. As explained 

in more detail below, immediately subjecting our evaporative cooler pumps to the 25% tariff would cause 

severe economic harm to a family-owned U.S. company that is the largest supplier of evaporative cooler 

pumps in the United States. 

I. Company Background

Dial is an American company headquartered in Phoenix, Arizona and we have been owned and operated 

by the same family since the company was founded in 1965. We employ [redacted number] U.S. based 

employees who receive products at our warehouse and perform kitting operations, distribution, and 

engineering tasks. 

Dial is the industry leader for a multitude of evaporative cooler parts and accessories, many of which are 

incorporated into the finished evaporative coolers of other U.S.-based Original Equipment Manufacturers.

Evaporative coolers are a form of climate control that employs evaporation to cool air that is passed 

through a filter and pushed into a house. This form of cooling is most prevalent in the Southwestern 

United States and other geographic regions that experience extreme heat.

Of all the parts and accessories sold by our company, we are the U.S.’s largest manufacturer and supplier 

of evaporative cooler pumps. We typically distribute over [redacted number] units per year both 

domestically and abroad.

II. Product Background

 

1 83 Fed. Reg. 133 (July 11, 2018)
DIAL MANUFACTURING, INC.

25 South 51st Avenue 

Phoenix, Arizona 85043-3711

(602) 278-1100  (800) 350-3425

2

Our evaporative cooler pumps are the product for which we are respectfully seeking Section 301 tariff 

relief. These pumps are classified under 8413.70.2005 of the Harmonized Tariff Schedule of the United 

States, which provides for “Other single-stage, single-suction, close coupled centrifugal pumps with 

discharge outlet under 5.08 cm in diameter” and has an associated duty rate of FREE. 

Functionally, our evaporative cooler pumps recirculate water within an evaporative cooler to keep an air 

media wet, which in turn allows evaporation when a blower wheel is running. The pumps are 

approximately 9 inches tall, 4.5 inches in diameter, 4.5 inches wide, and weigh approximately three 

pounds. Each is comprised of a fractional horsepower motor (less than 1/30 horsepower) made from steel 

that uses aluminum or copper windings. The pump is encased in a flame retardant plastic body, and the 

motor associated with the pump sits above a waterline driving a shaft, which in turn is attached to an 

impeller that pumps water out of a discharge port. (Please see Attachment A).

Our pumps are patented by the United States Patent and Trademark Office and meet the requirements 

promulgated by UL Standards (“UL”) and Electrical Testing Laboratories (“ETL”) certifying them as safe for 

incorporation into evaporative coolers. Evaporative cooler pump sales represent approximately 

[redacted percentage] of our company’s total revenue.

III. Our Evaporative Cooler Pumps are Only Available from China

As our evaporative cooler pumps are only available from China, we respectfully submit that they should 

be excluded from Section 301 tariffs.

As the U.S.’s largest manufacturer and supplier of evaporative cooler pumps, we are in a prime position 

to know that this product is only available from China in the quality and quantity suitable for the U.S 

market. Even within China, there are only a few factories capable of meeting the required standards. 

Our company has a deep appreciation for domestic manufacturing; unfortunately, based on our 

assessments, there are no domestic sources capable of producing pumps in a manner that meets our 

required specifications, quantity demands, and safety standards without significantly increasing the cost 

of the pump. These are three critical requirements that cannot be modified in order to re-source our 

product within the United States. Currently there are no manufacturing facilities in the United States that 

manufacture evaporative cooler pumps.

In order to remain competitive and pass savings to our customers, we also continuously explore whether 

suitable pumps are available from foreign suppliers located outside of China. Our initial assessments have 

shown that foreign manufacturers located outside of China are hypothetically existent; however, as we

explain in greater detail below, the complexity of our product and the time required to setup a new 

production facility make this kind of foreign sourcing impossible in the short term and significantly more 

expensive in the long term. 
DIAL MANUFACTURING, INC.

25 South 51st Avenue 

Phoenix, Arizona 85043-3711

(602) 278-1100  (800) 350-3425

3

Each individual pump that we produce is comprised of components sourced from [redacted number]

different suppliers, including plastic injection molding, steel stampers, metal coil manufacturers, and cord 

set manufacturers. Identifying new suppliers who could provide the necessary parts in the volume and 

quality required would further increase lead times and cause additional costs. In order to avoid additional 

expenses and meet local import/export requirements, we would anticipate needing to make significant 

and costly changes to our company’s logistics, procurement, and distribution channels. 

In addition to the complexity of the product itself, we must also ensure that any new manufacturing 

location would have a workforce that is sufficiently trained and has adequate resources such as reliable 

utilities and infrastructure. Based on our previous experiences, we estimate that setting up a new 

production facility outside of China would require over two years to establish and a significant injection 

of capital. This timeline is based in part on the fact that our pumps must be produced according to 

extremely high quality standards. As such, there are limited global manufacturers for evaporative cooler 

pumps generally and a particularly small group of factories with the ability to meet our particular 

requirements.

In sum, our pumps cannot be produced domestically due to a lack of available quality and quantity. 

Moreover, our pumps cannot be produced internationally outside of China in the short term due to the 

complexity of our product and the time required to setup a new manufacturing location. Thus, we 

respectfully submit that our pumps are only available in China and therefore would be appropriately 

exempted from the 301 tariffs.

IV. Imposition of the Duties on Evaporative Cooler Pumps Would Cause Severe Economic Harm

Prior to the imposition of the Section 301 tariffs, our evaporative cooler pumps benefited from a standard 

duty rate of Free. We estimate that adding a 25% tariff on our product will result in an increase of duty 

payments of over [redacted number] dollars this year alone. For a small company, this is a significant 

increase in our cost of production and would cut deeply into our profit margins. The additional tariff 

would result in a [redacted number] decrease to net income. As a result, we must choose whether to 

absorb the cost or pass it onto our customers. 

Absorbing the cost of the tariff would significantly decrease our operating profits, limit our company’s 

future growth, and would require us to reduce our current staffing levels both domestically and abroad. 

This would result in a smaller footprint within the evaporative cooler pump industry, which in turn would 

compound the economic harm to our financial position.

Alternatively, passing the cost of the tariff onto our customers could result in a significant loss of business 

for our company. Although we are recognized for the high-performance of our pumps, a 25% increase in 

the cost of our product may be more than our customers can bear. Customers may choose to purchase 

pumps from different suppliers who simply modify off-the-shelf goods and therefore have lower costs. A 

significant loss of customer orders would likely result in a termination of a significant number of U.S. 

employees.
DIAL MANUFACTURING, INC.

25 South 51st Avenue 

Phoenix, Arizona 85043-3711

(602) 278-1100  (800) 350-3425

4

In addition to the severe economic harm that would befall our company and our customers, imposing the 

Section 301 tariffs on our pumps would negate the significant amount of time and investment we have 

made in our Chinese production facility over the past several years. In 2008, due to the challenges

associated with producing pumps that satisfy quality and safety requirements while simultaneously 

remaining price competitive, our company established a wholly owned foreign enterprise in China. We 

undertook an intensive two year process to identify a factory in China with the capabilities of producing 

our pumps and meeting U.S. safety requirements, and we invested heavily in ensuring that the factory 

had the necessary equipment to produce the pumps to our specifications and customers’ quantity 

demands. This required a substantial capital investment and long-term growth planning. 

As mentioned previously in this letter, producing evaporative cooler pumps in the United States is not 

possible, and shifting production to foreign suppliers outside of China, while hypothetically achievable, 

would require significant costs that may be more detrimental than the 25% tariff impact. Specifically, 

identifying a factory that can support our needs is a challenge, and we would anticipate needing to make 

significant and costly changes to our company’s logistics, procurement, and distribution channels in order 

to avoid additional production expenses and meet local import/export requirements. In addition, we 

would be required to make a substantial capital and labor investment much like we did recently in China. 

This would be a challenging undertaking for a company of our size and would divert efforts to grow our 

business.

In sum, as a result of the tariffs imposed on one of our most critical components, we anticipate a significant 

decrease in revenue and possible customer attrition, resulting in severe on-going economic harm. Even if 

we attempt to source our products outside of China on an immediate basis, we would not be able to 

produce the quantity of pumps required to meet our contractual requirements with our direct U.S. 

customers or our U.S. Original Equipment Manufacturers. In addition, because any immediately 

alternatively available pumps would be inferior in quality, we would risk becoming noncompliant with 

safety standards established by Underwriters Laboratory, which in turn may preclude sales in in the United 

States (our largest market). Third, because each pump is comprised of parts from over a dozen suppliers, 

we would need to make significant changes to our logistics, procurement, and distribution models in order 

to avoid additional expenses and costs. And finally, because of the complexity of our pumps, moving our 

production to another country and setting up a new production line would require a long-term effort, 

which justifies the tariff relief which we are respectfully seeking.

V. Evaporative Cooler Pumps are not Strategically Important to the “Made in China 2025” Industrial 

Program

Evaporative cooler pumps are not benefitting from China’s “Made in China 2025” policy, which is intended 

to “transfor[m] China into an advanced manufacturing leader.”2Specifically, the “Made in China 2025” 

policy targets industries that include:

 

2 Made in China 2025: Global Ambitions Built on Local Protections, The U.S. Chamber of Commerce, 2017, 6. 
DIAL MANUFACTURING, INC.

25 South 51st Avenue 

Phoenix, Arizona 85043-3711

(602) 278-1100  (800) 350-3425

5

 Information technology;

 Numerical control machinery and robotics;

 Aerospace and aviation equipment;

 Maritime engineering equipment and high-tech maritime vessel manufacturing;

 Advanced rail equipment;

 Energy saving and new energy vehicles;

 Electrical equipment;

 New materials;

 Biomedicine and medical devices; and

 Agricultural machinery.3 

Although we take great pride in our pumps, we concede that they are not overly sophisticated or hightechnology consumer goods which the Chinese government would have interest in controlling. Although

the quality of component parts may vary, as well as the efficiency of the completed pump; evaporative 

cooler pump design is not a rapidly evolving industry.

Finally, regarding the larger family of “air comfort” products, the Chinese government has explicitly 

expressed interest in controlling production of our products’ largest competitor: air conditioners. 

Specifically, China indicated that it would like “indigenous brands to control over 80 percent of the 

domestic market for several consumer goods...including air conditioners.”

4 Although China has expressed 

an interest in air conditioners, it has not demonstrated an interest in the evaporative cooler industry and 

therefore cannot be strategically important to the “Made in China 2025” policy. In general, the United 

States market for evaporative cooling units is flat, i.e. there is no significant growth each year, and placing 

a large tax on a critical component could make the evaporative cooling units less appealing, potentially 

pushing more homeowners to air conditioning.

VI. Conclusion

The Section 301 tariffs on evaporative cooler pumps will place an unreasonable burden on a long-standing 

U.S. company. In addition to the increase in duties of over [redacted number] dollars, we may be forced 

to further expend additional resources in assessing the feasibility of relocating our supply chain. If we do

not receive an exclusion and cannot identify an alternative supply chain, we may be forced to pass these 

costs onto our customers. In that event, it is probable that we would experience customer attrition, 

making it difficult to continue as the market leader for these products, as well as to continue employing 

all of our current U.S. employees. As such, we respectfully request that the USTR grant an exclusion for 

evaporative cooler pumps classified under HTSUS.

The information in this request is complete and correct to the best of Dial’s knowledge. Thank you for 

your consideration. If you have any questions regarding our request, please contact Ryan Johnston, 

Director of Business Development at 602-278-1100.

 

3

Id. at 6.

4

Id. at 14.