CBP Ruling N324705 — The tariff classification of the Rear Drive Unit from Mexico

Tariff classification

Headings: 8501

Product description

The merchandise under consideration is identified as the Rear Drive Unit (RDU), which is described as a three-phase permanent magnet synchronous electric motor with a gearbox and a specialized housing. The RDU consists of the rotor and stator assemblies, the output shaft, the gearbox, the housing, and high-voltage connectors, and is intended to be mounted to a vehicle’s rear wheels to provide auxiliary propulsion. In use, the vehicle is said to provide 500 VDC that is applied to an onboard electrical inverter that is responsible for converting the direct current into a three-phase alternating current. We would note that it is the alternating current that is applied to the RDU bus bar connections, and while the vehicle battery systems produce and supply direct current, it is the output of the vehicle’s inverter that is applied to the motor and that which perpetuates the rotational motion. In your request, you suggest the RDU is properly classified under subheading 8501.52.8040, Harmonized Tariff Schedule of the United States (HTSUS). We agree.

CBP rationale

The applicable subheading for the Rear Drive Unit will be 8501.52.8040, HTSUS, which provides for “Electric motors and generators (excluding generating sets): Other AC motors, multi-phase: Of an output exceeding 750 W but not exceeding 75 kW: Other: Other.

Full text

N324705 March 24, 2022 CLA-2-85:OT:RR:NC:N2:220 CATEGORY: Classification TARIFF NO.: 8501.52.8040 Rachel Stallings FNS Customs Brokers Inc. 18620 Harmon Ave Carson, CA 90746 RE: The tariff classification of the Rear Drive Unit from Mexico Dear Ms. Stallings: In your letter dated March 9, 2022, you requested a tariff classification ruling on behalf of your client, LG Electronics Vehicle Components USA. The merchandise under consideration is identified as the Rear Drive Unit (RDU), which is described as a three-phase permanent magnet synchronous electric motor with a gearbox and a specialized housing. The RDU consists of the rotor and stator assemblies, the output shaft, the gearbox, the housing, and high-voltage connectors, and is intended to be mounted to a vehicle’s rear wheels to provide auxiliary propulsion. In use, the vehicle is said to provide 500 VDC that is applied to an onboard electrical inverter that is responsible for converting the direct current into a three-phase alternating current. We would note that it is the alternating current that is applied to the RDU bus bar connections, and while the vehicle battery systems produce and supply direct current, it is the output of the vehicle’s inverter that is applied to the motor and that which perpetuates the rotational motion. In your request, you suggest the RDU is properly classified under subheading 8501.52.8040, Harmonized Tariff Schedule of the United States (HTSUS). We agree. The applicable subheading for the Rear Drive Unit will be 8501.52.8040, HTSUS, which provides for “Electric motors and generators (excluding generating sets): Other AC motors, multi-phase: Of an output exceeding 750 W but not exceeding 75 kW: Other: Other.” The general rate of duty will be Free. Duty rates are provided for your convenience and are subject to change. The text of the most recent HTSUS and the accompanying duty rates are provided on the World Wide Web at https://hts.usitc.gov/current. This ruling is being issued under the provisions of Part 177 of the Customs Regulations (19 C.F.R. 177). A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, contact National Import Specialist Karl Moosbrugger at [email protected]. Sincerely, Steven A. Mack Director National Commodity Specialist Division

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