E7-10782. Foreign-Trade Zone 57 -- Charlotte, North Carolina, Expansion of Capacity and Manufacturing Authority -- Subzone 57B, Volvo Construction Equipment North America, Inc., Skyland, North Carolina, Area

An application has been submitted to the Foreign-Trade Zones Board (the Board) by Volvo Construction Equipment North America (Volvo CENA), operator of Subzone 57B, at the Volvo CENA construction equipment manufacturing plant in Skyland, North Carolina, requesting to expand capacity as well as the scope of manufacturing activity conducted under zone procedures within Subzone 57B. The application was submitted pursuant to the provisions of the Foreign-Trade Zones Act, as amended (19 U.S.C. 81a-81u), and the regulations of the Board (15 CFR part 400). It was formally filed on May 30, 2007.

Subzone 57B (240 employees) was approved by the Board in 2001 for the manufacture of construction equipment, specifically wheel loaders and articulated haulers (Board Order 1164, 66 FR28890, 5/25/01), and authority was expanded on August 21, 2003 to include skid-steer loaders and compaction rollers (Board Order 1284, 68 FR 52383, 9/3/03). The subzone currently consists of two sites totaling 64 acres located at 2169 Hendersonville Road in Skyland, North Carolina and 1865 Hendersonville Road in Asheville, North Carolina.

The current request involves an expansion of manufacturing capacity under FTZ procedures to include an additional 1,000 wheel loaders (up to 4,000 units annually) as well as to expand the scope of manufacturing activity conducted under FTZ procedures at Subzone 57B to include an additional finished product (excavators, up to 4,500 units annually). Finished excavators enter the United States duty-free. Volvo CENA is also requesting authority to conduct cab fabrication under FTZ procedures to produce cabs which will be used in excavator and wheel loader manufacturing. Currently the finished cabs are imported from the parent company in Sweden. Cabs fabricated at the Skyland site would replace those that are currently imported.

Volvo CENA's application indicates that foreign-sourced materials to be used under the expanded scope of authority fall into categories which are in the company's current scope of authority. Duty rates on the imports sourced from abroad range from duty-free to 12%. Zone procedures for the expanded finished products and inputs would exempt Volvo CENA from customs duty payments on the foreign components used in export production to non-NAFTA countries. Currently, foreign inputs account for approximately 65 percent of the value of the excavator. For domestic and NAFTA markets, Volvo CENA could choose the duty rate that applies to the finished product (duty-free) for the components used in production when the finished products are entered for U.S. consumption from the zone.

Public comment is invited from interested parties. Submissions (original and 3 copies) shall be addressed to the Board's Executive Secretary at the address below. The closing period for their receipt is August 6, 2007. Rebuttal comments in response to material submitted during the foregoing period may be submitted during the subsequent 15-day period to August 20, 2007.

A copy of the application and accompanying exhibits will be available for public inspection at each of the following locations:

U.S. Department of Commerce Export Assistance Center, 521 East Morehead St., Suite 435, Charlotte, North Carolina 28202.

Office of the Executive Secretary, Foreign-Trade Zones Board, U.S. Department of Commerce, Room 2111, 1401 Constitution Ave. NW, Washington, DC 20230.

For further information, contact Christopher Kemp at [e-mail] or [phone].

Dated: May 30, 2007.

Andrew McGilvray,

Executive Secretary.