Exporter Moves for Judgment in Thai Trailer Wheels Case

Commerce incorrectly determined that discs, the inner structures of wheels, share the essential characteristics of wheels and are substantially the same products, an exporter said to the Court of International Trade in a Jan. 30 motion for judgment (Asia Wheel Co. v. U.S., CIT # 23-00143).

Thai exporter Asia Wheel brought its complaint to CIT in August to contest a scope ruling that found the company’s products were subject to antidumping and countervailing duties on Chinese steel wheels between 22.5 and 24.5 inches in diameter (see 2308110057).

When the order was initially published in 2019, the Commerce Department released it alongside a scope memo that clarified that the order only covered tires processed in third countries if both the wheels’ rim and disc components were from China.

However, Asia Wheel alleges Commerce went back on this in June when, in a final scope ruling, it applied a substantial transformation analysis to determine that Asia Wheel’s wheels came from China because their discs were sourced from there, and they were not “substantially transformed” in Thailand, where they were manufactured.

The plain language of the scope cannot be reasonably read to cover wheels made of Chinese discs or rims, Asia Wheel said. Commerce confirmed this in its original AD/CVD investigation, it added.

The exporter also argued that Commerce’s substantial transformation analysis had been flawed. The department “unreasonably concluded” that a Chinese-origin disc, by itself, “already exhibits the essential characteristics of a finished wheel,” while “undisputed evidence” shows that a finished wheel requires both a rim and a disc, Asia Wheel said.

“Nowhere in either its final or preliminary scope ruling did Commerce answer the central question of whether the Chinese-origin disc used by Asia Wheel became a new product (a Thai Truck Wheel) in Thailand,” it said. “Instead, Commerce conducted a detailed analysis of the substantial transformation factors that was divorced from the fundamental question and, consequently, meaningless.”

Nor could the discs be considered the “essential components” of Asia Wheel’s wheels, the exporter claimed. It said the petitioners themselves described wheels as having “two primary components”: the disc and the rim.

“Therefore, a finished wheel requires both a rim and a disc to exhibit its essential characteristics and achieve its function,” it said. “Yet, from this record evidence, Commerce somehow nonsensically reasoned that a Chinese-origin disc fails to become a new product -- a complete and functional wheel -- when it is welded to a Thai-origin rim.”