2011-3539. Foreign-Trade Zone 29-Louisville, KY, Application for Expansion of Manufacturing Authority, Subzone 29F, Hitachi Automotive Systems Americas, Inc. (Automotive Electronic Components)

An application has been submitted to the Foreign-Trade Zones Board (the Board) by the Louisville and Jefferson County Riverport Authority (LJCRA), grantee of FTZ 29, on behalf of Hitachi Automotive Systems Americas, Inc. (HIAMS-AM) (formerly Hitachi Automotive Products (USA), Inc.), operator of Subzone 29F, HIAMS-AM plant, Harrodsburg, Kentucky, requesting authority to expand the scope of FTZ manufacturing authority. The application was submitted pursuant to the provisions of the Foreign-Trade Zones Act, as amended (19 U.S.C. 81a-81u), and section 400.28(a)(2) of the Board's regulations (15 CFR part 400). It was formally filed on February 10, 2011.

Subzone 29F was approved by the Board in 1990 with authority granted for the manufacture of automotive components at the HIAMS-AM plant located at 955 Warwick Road (Site 1) (50 acres) in Harrodsburg, Kentucky (Board Order 497, 56 FR 674, 1-8-91). Activity at the facility (624 employees) includes machining, assembly, testing, warehousing, and distribution of various automotive components, including mass air sensors, throttle bodies and chambers, starter motors, motor/generator units, alternators, distributors, other static converters, inverter modules, rotors/stators, ignition coils, electronic sensors and modules, fuel injectors, emissions control equipment, valves, pumps, and electronic control units for engines and transmissions (capacity—up to 8.5 million units annually).

LJCRA previously submitted an application in 2010 on behalf of HIAMS-AM requesting authority to expand the subzone to include two new warehouse facilities (adding Site 2 and Site 3) and to expand its scope of FTZ manufacturing authority to add 720,000 units to its authorized annual production capacity (proposed combined output: 9.22 million units per year) and to include the manufacture of high pressure, direct-injection fuel pumps as an additional finished product to be manufactured under FTZ procedures (Docket 38-2010; 75 FR 29723, 5-27-2010).

The applicant now requests that the scope of FTZ manufacturing authority be expanded to include additional production capacity (330,000 units per year) that will be added at the facility in 2011 (new combined output would be 9.55 million units per year). The expanded operations will involve similar finished products and utilization of both foreign-sourced and domestic materials and components under HIAMS-AM's existing scope of FTZ authority.

Components and materials sourced from abroad (representing about 80 percent of the finished automotive components' material value) include: adhesives, plastic fittings, plastic and rubber belts, fasteners, gaskets/seals/o-rings, metal fittings, labels, plastic wedging, springs, brackets, plates, filters, bearings, air pumps/compressors, valves, switches, electric motors, tubes/pipes/profiles, aluminum plugs, transformers, crankshafts, camshafts, gears, pulleys, couplings, clutches, parts of electric motors, pinions, magnets, ignition parts, diodes, transistors, resistors, semiconductors, liquid crystal devices, electrical instruments, navigation apparatuses, capacitors, printed/integrated circuits, fuses, rheostats, connectors, terminals, piezoelectric crystals, regulators, lamps, wires, cables, cylinders, plungers, insulators, brushes, brackets, shafts, and measuring instruments (duty rate range: free—9.0%).

Expanded FTZ procedures could continue to exempt HIAMS-AM from customs duty payments on the foreign-origin components used in production for export (about 30% of shipments). On its domestic shipments, the company would be able to elect the duty rate that applies to finished automotive components (free—6.7%) for the foreign-origin inputs noted above. Subzone status would further allow HIAMS-AM to realize logistical benefits through the use of weekly customs entry procedures. Customs duties also could possibly be deferred or reduced on foreign status production equipment. HIAMS-AM would also be exempt from duty payments on foreign inputs that become scrap during the production process.

In accordance with the Board's regulations, Pierre Duy of the FTZ Staff is designated examiner to evaluate and analyze the facts and information presented in the application and case record and to report findings and recommendations to the Board.

Public comment is invited from interested parties. Submissions (original and 3 copies) shall be addressed to the Board's Executive Secretary at the following address: Office of the Executive Secretary, Room 2111, U.S. Department of Commerce, 1401 Constitution Avenue, NW., Washington, DC 20230-0002. The closing period for receipt of comments is April 18, 2011. Rebuttal comments in response to material submitted during the foregoing period may be submitted during the subsequent 15-day period to May 2, 2011.

A copy of the application will be available for public inspection at the Office of the Foreign-Trade Zones Board's Executive Secretary at the address listed above and in the “Reading Room” section of the Board's Web site, which is accessible via http://www.trade.gov/​ftz.

For further information, contact Pierre Duy at [e-mail] or [phone].

Dated: February 10, 2011.

Andrew McGilvray,

Executive Secretary.