September 28, 2018 

VIA ELECTRONIC FILING PUBLIC VERSION 

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

United States Trade Representative 

Office of the United States Trade Representative 

600 17th St. NW 

Washington, DC 20006 

Re: Request for Exclusion from Section 301 Tariffs of Core Builder 

Dear Ambassador Lighthizer: 

 

On behalf of Valeo North America, Inc. (“Valeo”), we hereby submit our exclusion request for a 

Core Builder machine from the Section 301 tariffs enacted against products from the People’s 

Republic of China (“China”). These products are not economically and commercially available 

outside of China; these products are not high-tech products that are benefiting from the “made in 

China 2025” program; and imposition of additional duties on these products would significantly 

undermine Valeo’s competitive advantage in both the U.S. and global market. 

For these reasons, Valeo respectfully requests that the Core Builder Machine, imported from 

China, classified under HTS 8462.21.0000, be excluded from the final section 301 tariff list. 

These Core Builder machines consist 1) of a Fin Mill, which bends, cuts, and shapes aluminum 

strip into radiator fins for heat exchanger tubes; 2) a Core Builder, which will wrap the 

aluminum fins around a tube and assemble a series of tubes into a radiator or condenser; and 3) 

Electronic components to control and connect the machines. These goods could be described as: 

 Numerically Controlled Radiator/Condenser Core Builder, comprised of a machine which 

which bends, cuts, and shapes aluminum strip into radiator fins, a machine which wraps 

the aluminum fins around a tube and assembles those tubes into a radiator or condenser, 

and electronic equipment to control and connect the machines 

The specific machine at issue is identified as a ]. There 

were [ ] imports in 2017, [ ] imports in 2016, and [ ] imports in 2015. Valeo intends to 

import [ ] in 2018. The machines are valued at [ ] each. 

Valeo hereby requests business confidential treatment for certain information clearly identified 

in brackets in the comments below, and in Attachment 1. Valeo certifies that the data include, 

inter alia, business trade secrets, commercial or financial information and certain other 

information, the disclosure of which would endanger trade secrets or profitability, and that the 

information would not customarily be released to the public. Nevertheless, Valeo has provided a 

public version of this submission which can be placed in the public file for inspection. 
PUBLIC VERSION 

I. Background 

Valeo North America, Inc. is part of the Valeo Group. The Valeo Group is one of the world's 

leading automotive suppliers, providing a wide range of products to auto manufacturers and 

after-markets, including clutches, torque converters, engine cooling modules, climate control 

systems, lighting, wipers, and sensors, for most major car makers across the globe. The 

company’s innovative solutions are developed by four business groups - Powertrain Systems, 

Thermal Systems, Comfort and Driving Assistance Systems and Visibility Systems. The Valeo 

Group has 184 plants, 55 research and development centers, and 15 distribution platforms, and 

employs 111,600 people in 33 countries worldwide. 

Valeo has been serving the United States automotive market for 25 years. In North America, 

Valeo’s regional headquarters are located in Troy, Michigan. It has various offices, warehouses, 

production sites and research and development centers across the United States in California, 

Indiana, Kentucky, Michigan, Mississippi, New Hampshire, Ohio, Texas, Tennessee, and 

Virginia, and Valeo employs more than 14,000 people in North America. 

In 2017, Valeo generated sales of 18.6 billion euros and invested over 7% of its original 

equipment sales in research and development. Valeo’s sales are diversified across its operating 

segments, with Visibility Systems accounting for about 31% of the sales, followed by Thermal 

Systems (27% of revenue), Powertrain Systems (23% of revenue), and Comfort and Driving 

Assistance Systems (19% of the group's sales). In 2017, about half of its revenues were 

generated in Europe, followed by North America (20% of revenues), China (15%), the rest of 

Asia (16%), and South America (2%). 

II. Exclusion is Requested for the Increase in Demand and Lack of Commercial 

Availability Outside of China 

Valeo’ decision to import the Core Builder machine from China is driven by our increased 

customer demand in the U.S. and globally. The imported products are machines which will allow 

Valeo to manufacture radiators and condensers in the United States. 

Our Core Builder machine supplier is [ ]. This supplier has no government or 

state-owned enterprise (“SOE”) investment that we are aware of. There have not been any issues 

associated with the forced transfer of technology to which the additional 25% duties seek to 

remedy. In addition, [ ] has not benefited from the Chinese Government’s 

acts, policies or practices identified by the USTR as being unreasonable or discriminatory and 

that burden or restrict U.S. commerce. To the contrary, the goods purchased from [ ] 

increases U.S. commerce by complementing our North American facilities and allows us to 

manufacture new products in the United States. 

[ ] is not state owned, and their products simply are not among those identified as 

part of the “Made in China 2025” program that would benefit from the Chinese Government’s 

acts, policies or practices identified by USTR as being unreasonable or discriminatory and that 

burden or restrict U.S. commerce. 
PUBLIC VERSION 

Valeo has attempted to source the Core Builder machine from the United States, but was 

unsuccessful. A machine purchased from a U.S. supplier years ago did not function properly due 

to poor design[ ]. To the best of our knowledge, we cannot readily source the same or 

comparable products elsewhere in a commercially sufficient and cost-efficient manner. [ ] 

designed the product to Valeo’s specific requirements, and no other supplier has been able to 

supply to required product. The 25% tariff threatens our supply of U.S. manufactured product to 

our customers. 

III. Imposition of Additional 301 Tariffs would Cause Severe Economic Harm to Valeo 

The additional 25% duties on Valeo’ imported Core Builder machines would significantly 

increase our production cost. As we operate in a global market, the increased cost would result 

in our foreign competitors having a significant competitive advantage over Valeo, because they 

will still be able to procure the same machines from China without the 25% additional duty cost. 

This will make Valeo much less competitive in the global market and directly impact our ability 

to compete with foreign competitors. In turn, this will result in lost sales and, as a result, U.S. 

jobs. 

Further, the imported Core Builder Machine is used to manufacture critical inputs for our 

customers in the automotive original equipment manufacturer (“OEM”) industry. The 25% 

additional duty would adversely impact our automotive OEM customers by disrupting our supply 

chain and increasing costs. The additional duties would cause job losses due to a decrease in 

production if necessary parts and equipment are not available in a cost-effective manner. 

IV. Core Builder Machines Are Not Related to “Made in China 2025” or Other Chinese 

Industrial Programs 

Imposing additional 25% duties on the products that Valeo imports from China would serve no 

practical purpose to eliminate China’s unreasonable and discriminatory acts, policies, and 

practices identified by USTR in this investigation. Indeed, the Core Builder machines are used to 

manufacture automotive products that require less sophisticated production technology. Valeo’s 

supplier’s facility is not a high-tech producer that was identified in USTR’s report. The products 

produced in these facilities were not identified by the USTR report. Our imported products are 

simply not among those that benefit from the “Made in China 2025” program, or any other 

Chinese Government’s acts, policies or practices identified by USTR as being unreasonable or 

discriminatory and that burden or restrict U.S. commerce. 

In addition, force-transfer of technology only exists in joint-ventures between a U.S. and a 

Chinese company. In this case, there is no joint-venture between Valeo and its supplier. The 

goods are purchased at arm’s length. As such, there is no forced transfer if technology between 

Valeo and its supplier. 

V. Conclusion 

Based on the reasons stated above, we respectfully request an exclusion of the Core Builder 

Machines identified in the accompanying exclusion forms from the Section 301 tariffs because it 
PUBLIC VERSION 

would significantly increase Valeo’s operating cost and make us less competitive. The imported 

products are essential to completing our product line, and none of which are affected by the 

concerns cited by the USTR as justification for implementing the Section 301 tariffs. Tariffs on 

products that are not economically and commercially available to Valeo from U.S. producers 

will not advance national trade objectives and will be to the detriment of U.S. manufacturing. ****** 

Please direct any questions concerning this submission to the undersigned. 
Organization Name:

Note: Representatives submitting on behalf of an organization must enter information below.

Requestor Representative:

Section 301 Investigation: China's Acts, Policies, and Practices Related to Technology 

Transfer, Intellectual Property, and Innovation - Form to Request Exclusion of Product

When submitting a product exclusion request using this form, enter the specified 

information in the following fields and explain the basis and rationale for your statements. 

By completing this form, you certify that the information provided is complete and 

correct to the best of your knowledge. 

1. Indicate whether the comment contains business confidential information (BCI), is a public

document, or is a public version of a BCI document.

3.

2. Please provide a complete and detailed description of the particular product of concern:

4.

*

10-digit HTSUS item number* for product you wish to address in this product exclusion request:

Use numerical characters only with no special characters (example: 1023456789). For help in finding

the HTSUS item number associated with your product, see https://hts.usitc.gov/

7.

5. Requestor's relationship to the product:

6. Does this submission in regulations.gov include additional attachments?

Please indicate whether any additional attachment contains business confidential information 

(BCI), is a public document, or is a public version of a BCI document.

Requestor Information

Requestor Name (Last, First):

VERSION 2 CONTINUED BELOW 1
8. Is this product, or a comparable product, available from sources in the United States? (If you

9. Is this product, or a comparable product, available from sources in third countries? (If you

10. Please provide the value and quantity (with units) of the Chinese-origin product of concern

that you purchased for each calendar year specified. Limit this figure to the products

purchased by your firm (or by members of your trade association) alone. Please provide

estimates if precise figures are unavailable.

2017 Value:

2016 Value:

2015 Value:

2017 Quantity:

2016 Quantity:

2015 Quantity:

% of your total gross sales in 2017 that the Chinese-origin product accounted for.

% of the total cost of producing the final product(s) the Chinese-origin input 

accounts for.

% of your total gross sales in 2017 that sales of the final product(s) incorporating 

the input accounted for.

VERSION 2 CONTINUED BELOW 2

indicate "NO", you must provide support for your assertion in Box 12).

indicate "NO", you must provide support for your assertion in Box 12).

11. Is the Chinese-origin product of concern sold as a final product or an input used in

a) For imports sold as final products, please provide:

b) For imports of inputs used in the production of final products, please provide:

the production of a final product or products?
12. Please provide information in support your request, taking account of the

VERSION 2 END 3

instructions provided in Section B of the Federal Register notice. If you

responded "NO" to Questions 8 or 9, you must provide support for your

assertion in the box below. (Note: text entered below can extend beyond the

apparent size of this box).