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 product of concern:

4.

5. Requestor's relationship to the product:

CONTINUED BELOW

*

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/

1

7.

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.

VERSION 1

Requestor Information

Requestor Name (Last, First):

PUBLIC VERSION
END 2

8. Is this product, or a comparable product, available from sources in the United States?:

VERSION 1

11. Please provide information in support your request, taking account of the instructions

provided in Section B of the Federal Register notice (note: text entered below can extend

beyond the apparent size of this box).

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

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.

2016 Value:

2015 Value:

2017 Value:

2016 Quantity:

2015 Quantity:

2017 Quantity:

PUBLIC VERSION
1700 Pennsylvania Avenue, N.W.

Washington, DC 20006-4706

(202) 737-0500 (telephone)

(202) 626-3737 (fax)

www.kslaw.com

Stephen J. Orava

Direct Dial: (202) 661-7937

sorava@kslaw.com

October 8, 2018

VIA REGULATIONS.GOV 

The Honorable Robert E. Lighthizer

United States Trade Representative

Office of the U.S. Trade Representative 

600 17th Street, N.W.

Washington, DC 20508

Docket No. USTR–2018–0025 

PUBLIC VERSION

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

Technology Transfer, Intellectual Property, and Innovation / Request For 

Exclusion From Additional Duties 

Dear Ambassador Lighthizer : 

Honeywell International Inc. (“Honeywell”) files this request for exclusion from 

additional duties for its driven centrifugal compressor diffuser imported from China. This 

request is made pursuant to the procedures announced on July 11, 2018.1

Honeywell is a U.S. manufacturer of a variety of products, ranging from HVAC 

accessories and work wear to advanced aerospace technology. Honeywell operates production 

facilities in Georgia, South Carolina, New York, New Jersey, Pennsylvania, and Washington, 

and it employs 46,000 people in the United States.

1

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. 

32181 (July 11, 2018).

PUBLIC VERSION
The Honorable Robert E. Lighthizer 

October 8, 2018

Page 2 

Honeywell invents and manufactures technologies that address some of the world’s most 

critical challenges around energy, safety, security, productivity and global urbanization. It prides 

itself in being at the forefront of blending physical products with software to support connected 

systems that improve homes, buildings, factories, utilities, vehicles and aircraft, and that enable a 

safer, more comfortable and more productive world. Honeywell’s solutions enhance the quality 

of life of people around the globe and create new markets and even new industries. 

Honeywell requests an exclusion from the additional duties imposed under Section 301 

for its unique driven centrifugal compressor diffuser, which is presently unavailable in sufficient 

quantities from sources other than Honeywell’s supplier in China. Exclusion should be granted 

for Honeywell’s driven centrifugal compressor diffuser because failure to do so would result in 

severe economic harm to Honeywell and other U.S. interests. Furthermore, granting exclusion 

for Honeywell’s driven centrifugal compressor diffuser would not undermine the objectives of 

the Section 301 action against China. Additional information supporting this exclusion request is 

set forth below. 

I. IDENTIFICATION OF THE PRODUCT SUBJECT TO THE EXCLUSION

REQUEST – DRIVEN CENTRIFUGAL COMPRESSOR DIFFUSER

A. General Description

Honeywell seeks exclusion of its driven centrifugal compressor diffuser, which is used in 

auxiliary power units (“APUs”) in aircraft manufactured in the United States and elsewhere. It is 

made of nickel alloy and is 12.25” outer diameter x 1.25” tall with a hole through of 6” diameter 

(all dimensions approximate). There are 25 rectangular passages going from the inner diameter 

hole out through the outer diameter. These passages transport and modify the flow from the 

engine compressor to the combustor. This item is P/N 3827054-* (where* is a number 

physically located on one of the flat surfaces of the piece). 

PUBLIC VERSION
The Honorable Robert E. Lighthizer 

October 8, 2018

Page 3 

The driven centrifugal compressor diffuser is an integral part of the whole that enables 

compressor performance in the APU. The driven centrifugal compressor diffuser requires ISO 

9001 certification and qualifications to meet Supplemental Type Certification for the APU. 

The cost-sensitive nature of the aerospace industry necessitated the production of 

relatively less technologically sophisticated products, including the driven centrifugal 

compressor diffuser, in China. For APUs sold to commercial transport original equipment 

manufacturers (“OEMs”), like Boeing and Airbus, profitability is made in aftermarket support 

for the airlines, with break-even points of a decade or longer. This business model is thus 

particularly sensitive to product cost. Therefore, Honeywell began to source the driven 

centrifugal compressor diffuser from China in an effort to drive down costs to remain 

competitive in the global market. 

The Attachment provides diagrams and additional information regarding the product 

subject to this exclusion request. 

B. Specific Description for Customs Purposes

The following product descriptions may be used by U.S. Customs and Border Protection 

(“CBP”) to administer the exclusion: 

The driven centrifugal compressor diffuser is made 

of nickel alloy inconel 625 and is 12.17” outer 

diameter x 1.16” tall with a hole through of 6.20” 

inner diameter (all dimensions approximate). There 

are 25 bolt holes that penetrate the forward & aft 

plates. It is P/N 3827054-* (where* is a number 

physically located on one of the flat surfaces of the 

piece). 

PUBLIC VERSION
The Honorable Robert E. Lighthizer 

October 8, 2018

Page 4 

C. The Applicable HTSUS 10-Digit Subheading

The driven centrifugal compressor diffuser subject to this exclusion request falls within 

the 10-digit HTSUS subheading 8411.99.9090. This subheading provides for parts of aircraft 

gas turbines. 

II. AN EXCLUSION SHOULD BE GRANTED BECAUSE THE DRIVEN

CENTRIFUGAL COMPRESSOR DIFFUSER IS NOT READILY OR

SUBSTANTIALLY AVAILABLE FROM SUPPLIERS OTHER THAN

HONEYWELL’S SUPPLIER IN CHINA

An exclusion should be granted for the driven centrifugal compressor diffuser because it

is presently available only from certified suppliers and almost all of the available product is 

provided from Honeywell’s supplier in China. The driven centrifugal compressor diffuser is 

proprietary to Honeywell and is manufactured to Honeywell’s unique specifications primarily by 

a trusted manufacturer in China. As a result, Honeywell is unable to source this part in 

commercially significant volumes from any other factory either in the United States or third 

countries. 

Moreover, Honeywell is unable to modify its supply chain to transition the production of 

the driven centrifugal compressor diffuser to a supplier outside of China without severe 

economic harm to Honeywell and without undermining supply to the U.S. aircraft manufacturing 

industry. Honeywell estimates the transition process would take approximately two or more 

years to implement, at a cost of up to $1 million per part. Each supplier of a driven centrifugal 

compressor diffuser must also be vetted through a rigorous certification process, which could 

further lengthen the time required for Honeywell to modify its supply chain. This certification 

process includes facility certification and working with the new vendor to achieve acceptable 

production quality levels at the required production rate. Use of any new vendor requires 

PUBLIC VERSION
The Honorable Robert E. Lighthizer 

October 8, 2018

Page 5 

sending a team of process experts to the vendor for an extended period of time. Other 

requirements include an extensive material analysis of the product, a complete inspection of all 

dimensions and features of the product, and a system test at Honeywell to verify product 

performance. 

Capacity constraints in the aerospace industry are an additional obstacle to Honeywell 

sourcing the driven centrifugal compressor diffuser from sources other than its supplier in China. 

OEMs like Boeing and Airbus have increased production rates to unprecedented levels. At 

present, multiple parts suppliers have been unable to satisfy the increased demand. For example, 

casting and forging suppliers have caused significant delays for both engine and auxiliary power 

unit manufacturers over the past 24 months. Even if Honeywell attempted to manufacture the 

driven centrifugal compressor diffuser outside of its factory in China, in addition to the 

certification obstacles described above, it is unlikely that other potential suppliers to Honeywell 

would have the capacity to ramp up tooling and increase capacity to meet the new demand. 

Therefore, the driven centrifugal compressor diffuser is presently unavailable outside of China. 

III. HONEYWELL AND OTHER U.S. INTERESTS WOULD SUFFER SEVERE

ECONOMIC HARM IF THE EXCLUSION IS NOT GRANTED

Honeywell will suffer significant economic harm if it does not receive an exclusion for

the driven centrifugal compressor diffuser. Honeywell would be unable to pass on the costs of 

the additional tariffs to either OEMs or airline customers due to long term contracts currently in 

place. For example, the 737 MAX contract expires with Boeing in 2026, and the Airbus A320 

contract expires in 2023. Both contracts require that key suppliers like Honeywell decrease costs 

over the term of the contract, with no ability to change or increase price due to Boeing/Airbus 

influence. Honeywell would thus be forced to absorb the costs of the additional tariffs, resulting 

in significant financial harm to the company. This would prevent Honeywell from supporting 

new required development program investment and supporting other current production program 

volumes. 

PUBLIC VERSION
The Honorable Robert E. Lighthizer 

October 8, 2018

Page 6 

In addition, Honeywell could be closed out of its market if it were forced to modify its 

supply chain to produce the driven centrifugal compressor diffuser outside of China. As outlined 

above, modification of its supply chain would result in significant costs and lead time. It is also 

unclear whether other potential suppliers capable of producing the driven centrifugal compressor 

diffuser to Honeywell’s specifications could satisfy the additional demand. This would 

compromise the continuity of Honeywell’s supply to its OEM and airline customers. Given the 

intensity of competition in the industry and long duration contracts between suppliers and OEMs, 

disruption in the continuity of its supply could result in Honeywell being shut out of the market 

for up to 30 years. 

IV. GRANTING AN EXCLUSION FOR THE DRIVEN CENTRIFUGAL

COMPRESSOR DIFFUSER WOULD NOT UNDERMINE THE OBJECTIVES OF

THE SECTION 301 ACTION

USTR should grant an exclusion for Honeywell’s driven centrifugal compressor diffuser

because an exclusion for this product would not undermine the objectives of the Section 301 

action. The Section 301 action is aimed, in part, at combatting forced technology transfer of 

industrially significant technologies from U.S. companies to Chinese entities. With respect to 

the manufacture of Honeywell’s driven centrifugal compressor diffuser, no advanced technology 

or technical know-how has been transferred to the Chinese supplier manufacturing the product. 

Operations in China are limited to the manufacture of select product families, including the 

driven centrifugal compressor diffuser, while design and assembly of the APU or engine takes 

place in Honeywell’s facilities in the United States. The valuable technology and intellectual 

property involved in the design and manufacture of the APUs thus remains in the United States, 

PUBLIC VERSION
The Honorable Robert E. Lighthizer 

October 8, 2018

Page 7 

and imposition of tariffs on the driven centrifugal compressor diffuser would not impact China’s 

technology transfer practices in any material way. 

Failure to grant an exclusion would undermine the objectives of the Trump 

Administration by benefiting foreign manufacturers of driven centrifugal compressors diffusers 

to the detriment of Honeywell, its U.S. employees, and other U.S. businesses. Honeywell’s main 

competitors for the downstream engines in which the subject products are incorporated are 

United Technology’s Pratt Canada division and Safran’s Microturbo division located in France. 

Honeywell’s understanding is that its main competitors are not subject to the 301 tariffs, so the 

tariffs would put Honeywell at a significant cost disadvantage relative to its foreign competitors. 

V. THE EXCLUSION FOR THE DRIVEN CENTRIFUGAL COMPRESSOR

DIFFUSER SHOULD BE GRANTED BECAUSE THE PRODUCT IS NOT

STRATEGIC TO CHINA’S MADE IN CHINA 2025 OR OTHER INDUSTRIAL

PROGRAMS

The specific products requested to be excluded are not strategic to China’s Made in China

2025 or other industrial programs. The imposition of additional tariffs now on the driven 

centrifugal compressor diffuser would not impact in any material way China’s policies, and such 

policies are more likely to be affected, if at all, by sustained, comprehensive, and multilateral 

efforts. Imposition of additional tariffs would, however, have a significant detrimental impact on 

Honeywell and likely its customers. Accordingly, increased tariffs would not alter Chinese 

policies, would increase Honeywell’s costs, and would decrease its competitive position.

VI. THE EXCLUSION FOR THE DRIVEN CENTRIFUGAL COMPRESSOR

DIFFUSER SHOULD BE GRANTED BECAUSE IT IS ADMINISTRABLE

Finally, U.S. Customs and Border Protection will be able to administer the exclusion at

the border. The driven centrifugal compressor diffuser is comprehensively described in the 

PUBLIC VERSION
The Honorable Robert E. Lighthizer 

October 8, 2018

Page 8 

preceding sections of this request, and this request is accompanied by additional documentation 

depicting the product. 

VII. IMPORT DATA APPLICABLE TO DRIVEN CENTRIFUGAL COMPRESSOR

DIFFUSER

Please see the table below for quantity (estimated) and value data for imports of driven

centrifugal compressors diffuser originating from China over the past three years. 

Year Quantity Value

2015 [ ] [ ]

2016 [ ] [ ]

2017 [ ] [ ] 

VIII. CONCLUSION

For the above reasons, USTR should grant an exclusion for Honeywell’s driven

centrifugal compressor diffuser. Granting an exclusion is warranted because the product is not 

readily available outside of China, Honeywell, its employees, and customers would suffer severe 

economic harm, and the exclusion would not undermine the objectives of the Section 301 action. 

Respectfully submitted, 

Stephen J. Orava 

Partner 

PUBLIC VERSION
CERTIFICATION 

I, Raymond M. Boyd of Honeywell International Inc., certify that the information 

contained in this submission is accurate and complete to the best of my knowledge. I 

also certify that disclosure of the information marked "business confidential" would 

endanger trade secrets or profitability, and that the information would not customarily be 

released to the public. 

Signature: � � �_} 

Date: ___,__/_O +--/4_'1---f-/.....;.._;/8;;;___ __ 

I / 

Honeywell Restricted 

PUBLIC VERSION
ATTACHMENT 

PUBLIC VERSION
Honeywell Confidential - © 2016 by Honeywell International Inc. All rights reserved. 

3827054-2

DIFFUSER, CENTRIFUGAL COMPRESSOR, DRIVEN

Material: Steel & Inconel Alloy

Approx. 12.25” Diameter X 1.25” Tall

PUBLIC VERSION
Honeywell Confidential - © 2016 by Honeywell International Inc. All rights reserved. 

PUBLIC VERSION