Foreign-Trade Zone (FTZ) 18--San Jose, California; Notification of Proposed Production Activity; Tesla, Inc. (Electric Passenger Vehicles and Components), Fremont, Livermore, and Oakland, California

Topics:  Tesla

Elizabeth Whiteman
Department of Commerce
5 December 2019

[Federal Register Volume 84, Number 234 (Thursday, December 5, 2019)]
[Notices]
[Pages 66651-66652]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-26272]


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DEPARTMENT OF COMMERCE

Foreign-Trade Zones Board

[B-73-2019]


Foreign-Trade Zone (FTZ) 18--San Jose, California; Notification 
of Proposed Production Activity; Tesla, Inc. (Electric Passenger 
Vehicles and Components), Fremont, Livermore, and Oakland, California

    Tesla, Inc. (Tesla) submitted a notification of proposed production 
activity to the FTZ Board for its facilities in Fremont, Livermore, and 
Oakland, California. The notification conforming to the requirements of 
the regulations of the FTZ Board (15 CFR 400.22) was received on 
November 26, 2019.
    Tesla already has authority to produce electric passenger vehicles 
and related components within FTZ 18. The current request would add 
nine finished products and a foreign status material/component to the 
scope of authority. Pursuant to 15 CFR 400.14(b), additional FTZ 
authority would be limited to the specific foreign-status material/
component and specific finished products described in the submitted 
notification (as described below) and subsequently authorized by the 
FTZ Board.
    Production under FTZ procedures could exempt Tesla from customs 
duty payments on the foreign-status material/component used in export 
production (estimated at up to 50 percent of production). On its 
domestic sales, for the foreign-status materials/components noted below 
and in the existing scope of authority, Tesla would be able to choose 
the duty rates during customs entry procedures that apply to doors, 
front under body shotguns, vehicle body sides, automotive spoilers, 
hoods, vehicle roof headers, lift gates, under bodies, and quarter 
panels (duty rate duty-free to 2.5%). Tesla would be able to avoid duty 
on the foreign-status component which becomes scrap/waste. Customs 
duties also could possibly be deferred or reduced on foreign-status 
production equipment.
    The material/component sourced from abroad is aluminum coil (duty 
rate 3.0%). The request indicates that aluminum coil is subject to an 
antidumping/countervailing duty (AD/CVD) order if imported from the 
People's Republic of China. The FTZ Board's regulations (15 CFR 
400.14(e)) require that merchandise subject to AD/CVD orders, or items 
which would be otherwise subject to suspension of liquidation under AD/
CVD procedures if they entered U.S. customs territory, be admitted to 
the zone in privileged foreign status (19 CFR 146.41). The request also 
indicates that aluminum coil is subject to special duties under Section 
232 of the Trade Expansion Act of 1962 (Section 232) and Section 301 of 
the Trade Act of 1974 (Section 301), depending on the country of 
origin. The applicable Section 232 and Section 301 decisions require 
subject merchandise to be admitted to FTZs in privileged foreign 
status.
    Public comment is invited from interested parties. Submissions 
shall be addressed to the Board's Executive Secretary and sent to: 
ftz@trade.gov. The

[[Page 66652]]

closing period for their receipt is January 14, 2020.
    A copy of the notification will be available for public inspection 
in the ``Reading Room'' section of the Board's website, which is 
accessible via www.trade.gov/ftz.
    For further information, contact Juanita Chen at 
juanita.chen@trade.gov or 202-482-1378.

    Dated: December 2, 2019.
Elizabeth Whiteman,
Acting Executive Secretary.
[FR Doc. 2019-26272 Filed 12-4-19; 8:45 am]
 BILLING CODE 3510-DS-P