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Federal Register / Vol. 86, No. 213 / Monday, November 8, 2021 / Notices
DEPARTMENT OF COMMERCE
Publication of a Report on the Effect of Imports of Automobiles and Automobile Parts on the National Security: An Investigation Conducted Under Section 232 of the Trade Expansion Act of 1962, as Amended Department of Commerce.
Publication of a report.

AGENCY:
ACTION:

The Department of Commerce in this notice is publishing the Report on the Effect of Imports of Automobiles and Automobile Parts on the National Security. The report documents the findings of the Department of Commerces investigation to determine the effects on the national security of imports of automobiles, including cars, SUVs, vans and light trucks, and automotive parts. This investigation was carried out under Section 232 of the Trade Expansion Act of 1962, as amended. All classified and business confidential information in the report was redacted before the release. This report was completed on February 17, 2019 and posted on the Bureau of Industry and Security BIS website on July 6, 2021. The Department of Commerce has not published the appendices to the report in this notification of report findings, but they are available online at the BIS website, along with the rest of the report see the ADDRESSES section.
DATES: The report was completed on February 17, 2019. The report was posted on the BIS website on July 6, 2021.
SUMMARY:

The full report, including the appendices to the report, are available online at https
www.bis.doc.gov/index.php/otherareas/office-of-technology-evaluationote/section-232-investigations.
FOR FURTHER INFORMATION CONTACT:
Brittany Caplin, Office of Public Affairs, U.S. Department of Commerce at 202
4824883. For more information about the section 232 program, including the regulations and the text of previous investigations, see www.bis.doc.gov/232.
SUPPLEMENTARY INFORMATION:
ADDRESSES:

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The Effect of Imports of Automobiles and Automobile Parts on the National Security An Investigation Conducted Under Section 232 of the Trade Expansion Act of 1962, as Amended U.S. Department of Commerce February 17, 2019
Table of Contents I. Executive Summary Findings
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1. A Healthy U.S. Automobile and Automobile Parts Manufacturing Industry Is Necessary for U.S. Defense and National Security 2. Imports of Automobiles and Automobile Parts Are Impairing the Ability of the Domestic Industry To Meet National Defense Requirements 3. Decline in U.S. R&D for Important Automotive Technologies Threatens To Impair U.S. National Security Conclusion and Recommendations II. Legal Framework A. Section 232 Requirements B. Discussion III. Investigation Process A. Initiation of Investigation B. Public Comments C. Public Hearing D. Interagency Consultation E. U.S. Producers Survey Responses IV. Product Scope of the Investigation V. Background on the Industry A. Global Competitiveness of U.S.
Automobile Producers B. U.S. Automobile Producers Transition From Vertical Integration to Outsourcing Automobile Parts Production C. NAFTA and the Rise of Automobile and Automobile Parts Production in Mexico Instead of the United States 1. The Rise of Automobile Assembly in Mexico and Offshoring of Automobile Plants 2. Offshoring of Automobile Parts VI. Analysis A. Present Import Quantities of Automobiles Have Weakened the American-Owned Automotive Industry 1. U.S. Automobile Production Volume Has Eroded Over Three Decades Due to Imports 2. Market Penetration by Automobile Imports Is Significant 3. Low Priced Foreign-Owned Automobile Production and Imports Have Caused Significant Market Penetration in the United States and Have Suppressed U.S.
Producers Prices B. Imports of Automobile Parts in Such Quantities as Are Presently Found Threaten the Viability of the U.S.
Automobile Parts Industry 1. Imports of Automobile Parts Have Displaced U.S. Production, and the United States Has Become Dependent on Imported Automobile Parts that Are Critical to Defense Applications and National Security 2. U.S. Producers of Automobile Parts Are Facing Downward Pressure on Prices Due to Low U.S. Automobile Prices C. Domestic Manufacturing and Domestic R&D in Technologies for Engines, Transmissions, and Electrical Components Are Necessary for National Security 1. The U.S. Military Relies on the Domestic Automotive Sector for Technological Advancements 2. Growth of American-Owned R&D for Critical Automobile Parts Is Essential to Strengthen U.S. National Security D. Decline in Employment in the U.S.
Automotive Industry VII. Conclusion
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VIII. Recommendation Appendix A: Section 232 Investigation Notification Letter From Secretary of Commerce Wilbur Ross to Secretary of Defense James Mattis, and Letter from Secretary of Defense James Mattis to Secretary of Commerce Wilbur Ross Regarding U.S. Defense and National Security Appendix B: Federal RegisterNotice Request for Public Comments and Public Hearing on Section 232 National Security Investigation of Imports of Automobiles and Automobile Parts Appendix C: Public Hearing Transcript Appendix D: Details on U.S. Harmonized Tariff System HS Statistics 1. Automobile Parts HS10 Codes 2. Automobile Parts Schedule B Codes 3. Passenger Vehicle HS10 Codes 4. Passenger Vehicle Schedule B Codes Appendix E: Technical AppendixDetailed Economic Impact, R&D Expenditure Estimates, and Methodology 1. Impact of Tariffs on Automobiles &
Automobile Parts, Recommendation Option 2
2. Methodology Appendix F: Foreign Market Barriers Prevent U.S. Automobile Producers Growth 1. The European Union 2. China 3. Japan 4. South Korea Appendix G: Recent Trade Negotiations With Canada and Mexico That Impact the Recommendation Appendix H: Risks to the U.S. Automotive Industry and U.S. National Security if U.S. Sales of Automobiles Decline Further
I. Executive Summary This report summarizes the findings of an investigation conducted by the U.S. Department of Commerce Department pursuant to Section 232
of the Trade Expansion Act of 1962, as amended 19 U.S.C. 1862 Section 232, into the effects of imports of automobiles 1 and automobile parts on the national security of the United States. In conducting this investigation, the Secretary of Commerce Secretary noted the Departments prior investigations under Section 232.2
Consistent with those investigations, the Secretary in this investigation again determined that national security for purposes of Section 232 includes the general security and welfare of certain industries, beyond those necessary to 1 For purposes of this investigation, automobiles include: Passenger vehicles, including sedans, sport utility vehicles SUVs, crossover utility vehicles CUVs, vans including minivans and cargo vans, and light trucks.
2 See, e.g., Department of Commerce, Bureau of Industry and Security, The Effect of Imports of Steel on the National Security, Jan. 2018 2018 Steel Report; Department of Commerce, Bureau of Industry and Security, The Effect of Imports of Aluminum on the National Security, Jan. 2018
2018 Aluminum Report.

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