Public Version of BCI

The product is a turbine housing assembly sold to General Motors to improve fuel economy on 

combustion engines in the automotive industry. The product is made of ductile cast iron with dimensions 

of 288.10 x 245.10 x 129.32 mm. The product is generally shipped in a wooden crate and packaged in 

expendable cardboard. The HTSUS code, part number, and weight are printed on the commercial 

invoice, distinguishing this product from other imported products and facilitating administration of this 

exclusion by CBP. The product is further identifiable by a label on the product that correlates to the 

commercial invoice provided by the shipper. The product number for this product is 12701017029. 

8414904190

Whittemore, Russell

BorgWarner Inc.

David Hamill, Arent Fox LLP

Importer

YES

Public Version of BCI

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. 

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

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

I I 

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

3. IO-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/ 

4. Requestor Information 

Requestor Name (Last, First): 

Organization Name: 

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

Requestor Representative: 

5. Requestor's relationship to the product: 

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

7. 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 CONTINUED BELOW 1 
NO

NO

[ ] [ ] units

[ ] [ ] units

[ ] [ ] units

[ ] 

See attached for arguments in support of this exclusion request.

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

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. 

2017 Value: 

2016 Value: 

2015 Value: 

2017 Quantity: 

2016 Quantity: 

2015 Quantity: 

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 bdow can extend 

beyond the apparent size of this box). 

VERSION 1 END 2 
BorgWarner Inc. World Headquarters 3850 Hamlin Road 

Auburn Hills 

Michigan 48326, USA 

Tel: +1 248-754-0422 

October 1, 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 Turbine Housings and Turbocharger Components from the 

Determination of Action Pursuant to Section 301 

Dear Secretary Lighthizer: 

BorgWarner Inc. (“BorgWarner”) respectfully submits this request for the exclusion of 

turbine housings and turbocharger components from the proposed determination of action 

pursuant to Section 301 of the Trade Act of 1974.1 This request is timely filed, pursuant to the 

U.S. Trade Representative’s (“USTR”) instructions set forth in the Section 301 Determination.2

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.3

The undersigned certifies that disclosure of the information identified in brackets in the 

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 (USTR July 

11, 2018). 

3

Id. at 32,183-84. 
PUBLIC VERSION Page 2 of 7 

confidential version of this submission would endanger the trade secrets and profitability of 

BorgWarner and would not customarily be released to the public. 

BorgWarner is a global product leader in clean and efficient technology solutions for 

combustion, hybrid and electric vehicles. With manufacturing and technical facilities in 66 

locations in 18 countries, we employ approximately 29,000 people worldwide. BorgWarner has 

evolved from a powertrain supplier to a vehicle propulsion company that is playing a major role 

in creating our vision of a clean, energy-efficient world. 

Our company’s origins date back to the 1880s in the United States and we have grown to 

a $9.8 billion publicly-traded company today. BorgWarner’s growth in the last century is the 

result of the expansion of new markets due to public policies that supported international trade. 

As an American company headquartered in the Auburn Hills, Michigan, we employ over 6,300 

people in 16 manufacturing and technical centers in eight states across the nation. Our company 

uses a local-for-local supply chain strategy and we source regionally when it is possible. In the 

U.S. we have a 65% supplier localization rate and our direct material purchases total over $1 

billion annually, with approximately 700 U.S.-based suppliers. Additionally, with our main R&D 

center for the U.S. in Auburn Hills, Michigan with four other R&D centers in the states of 

Michigan, Indiana, North Carolina, and New York. BorgWarner Inc. currently holds over 60% of 

our intellectual property in the U.S. Since 2012, BorgWarner has invested 600 new jobs and over 

$530 million in capital investments in the U.S. 
PUBLIC VERSION Page 3 of 7 

Though our goal is to source products regionally, the automotive industry is and has 

always been a global industry, and we source certain automotive parts to support our U.S. 

operations from China. The USTR has proposed a 25% ad valorem tariff on these items, which 

will negatively impact BorgWarner’s U.S. operations [ 

 ] 

This exclusion request addresses turbine housings and turbocharger components

classified under HTSUS subheading 8414.90.4190, which are currently subject to the 25% 

additional Section 301 tariff. Please note that a separate Section 301 Investigation Form to 

Request Exclusion of Product has been submitted for each unique product for which we are 

requesting an exclusion. 

In accordance with the procedures released by the USTR,4 BorgWarner provides the 

following information requested by the USTR in support of this request. 

1. 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. 

BorgWarner is not aware of any immediately available U.S. or third-country sources for 

the same or comparable products. Any supplier change would require a multi-year process as 

our customers requalify and approve the new supplier. 

4

Id.
PUBLIC VERSION Page 4 of 7 

The turbine housing and turbocharger component products that are the subject of this 

exclusion request (and like products) were previously produced in the U.S. However, production 

was forced out of the U.S. due to aging infrastructure and multiple foundry closures across the 

country. That production shift stemmed from a lack of investment in U.S. foundries, which left 

those facilities unable to meet the high quality standards required by the automotive industry. As 

a result, BorgWarner was forced to source from qualified suppliers in China and other countries. 

These parts, or like parts, were originally sourced to a third-world country outside of China, but, 

due to quality issues, sourcing was moved to China to a known source, which uses ductile iron 

material. 

BorgWarner is not aware of immediately-available existing capacity in the U.S. that 

could produce these parts to our customer specifications and BorgWarner’s requirements. We are 

unaware of the current capacity of existing U.S. producers and identifying a source within the 

U.S. would be a lengthy process. Part numbers 53031017917 and 53031017916 are not 

available in the U.S. in the necessary quantities and volumes required to support our customers. 

Even for products where domestic sources may ultimately be available, it would still take 

several years for U.S. supplier’s to satisfy BorgWarner’s and its customers’ validation 

requirements for these products. Therefore, switching suppliers for this product would likely 

lead to supply interruptions due to the lack of established infrastructure in place to handle the 

production of this product. BorgWarner estimates that moving production to a country outside 

of China would take at least 3-5 years. 
PUBLIC VERSION Page 5 of 7 

BorgWarner’s leading competitors also import heavily from China for like products. Our 

customers have expectations regarding quality that cannot be met by local sources. BorgWarner 

understands the intent and spirit of Section 301 is to protect the U.S. from China’s Acts, Policies, 

and Practices Related to Technology Transfer, Intellectual Property, and Innovation. However, 

any major changes to our supply chain could hurt our engineering and manufacturing processes, 

delay production, and jeopardize our ability to meet the vehicle production demands of the 

industry. 

For an automobile, the quality and consistency of materials and components are of the 

utmost importance because they can impact the vehicles performance. Our technologies take 

many years to refine and often require specialized materials in engineering and production. The 

products at issue are specifically calibrated with a customer’s engine systems and validated for 

performance and durability upon initial designs. Before a product is approved by our customer 

for production, our engineers must validate its performance. The testing process encompasses 

production validation, engineering studies, results analyses, and final reporting to the customer. 

If a new supplier passes the tests, BorgWarner engineers present data, analyses, and conclusions 

to its customers, who make the final decision on whether to approve our new supplier. In total, 

this process alone usually requires approximately twelve months. If a supplier fails a test, this 

timeframe could double. In addition, due to the technical nature of the products, our customers 

require their own extensive independent testing and validation of any and all suppliers to ensure 

adequate product performance, which adds further time and costs. 
PUBLIC VERSION Page 6 of 7 

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

severe economic harm to the requester or other US interests. 

The products imported by BorgWarner that are included on the USTR’s product list are 

automotive parts, which are imported to support domestic manufacturing operations and 

American jobs in the United States. The imposition of a 25% tariff on these automotive parts 

could cause severe economic harm to U.S. interests, [ ] our customers, 

and consumers. Specifically, any future business opportunities involving these products could be 

directly impacted by the price increase caused by the additional tariff. If BorgWarner directly 

absorbs the cost of the increase, our profitability will be damaged, [ 

 ] 

The added costs could also inhibit our U.S. facilities’ ability to meet the financial returns 

[ 

 ]. [ 

 ] 

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

China 2025” or other Chinese industrial programs. 

The imposition of a 25% ad valorem duty on turbine housings and turbocharger 

components will not impact the Chinese intellectual property violations they seek to eliminate. 
PUBLIC VERSION Page 7 of 7 

Section 301 tariffs should be specifically targeted at products that have benefitted from the 

China’s acts, policies, and practices detailed in the USTR’s Section 301 Report. The turbine 

housings and turbocharger components at issue have not experienced or benefitted in any way 

from China’s discriminatory licensing requirements, foreign ownership restrictions, state-funded 

acquisitions, or state-backed hacking operations. The turbine housings and turbocharger 

components are designed by BorgWarner and our intellectual property is not transferred to any 

Chinese supplier. 

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 

knowledge. 

Sincerely, 

 ________________________ 

Russell Whittemore 

Director, Supply Chain 

BorgWarner Turbo Systems 

BorgWarner Inc. 

828-650-7409 

rwhittemore@borgwarner.com