ITC, Commerce Overlooked Seasonal Trends of Chinese Vehicle Sales in Critical Circ. Finding, Companies Say
Exporter Kangdi Electric Vehicle (Hainan) and its affiliated importer Kandi America filed a pair of complaints at the Court of International Trade on Oct. 14 to contest the International Trade Commission's and Commerce Department's affirmative finding of critical circumstances regarding Chinese low speed personal transportation vehicles from China (Kangdi Electric Vehicle (Hainan) v. United States, CIT #'s 25-00201, -00202).
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In both cases, Kangdi argued that the ITC and Commerce failed to account for "seasonal trends" in finding that post-petition subject merchandise would harm the U.S. industry. The exporter argued that the increase in imports that occurred in the comparison period used by the ITC in evaluating critical circumstances "mirrors the expected increase in the third and fourth quarters that is consistent with the data on the record for the three years prior to the filing of the petition."
The record clearly shows that Chinese low speed personal transportation vehicle manufacturers make these goods "based on seasonal trends," the exporter said. Commerce rejected Kangdi's evidence on this front as being untimely submitted, though it accepted the firm's case brief. The exporter said the import data in the case brief was already part of the record, since it was submitted by the petitioner in its critical circumstances allegation.
Meanwhile, Kangdi argued that the ITC didn't "adequately consider evidence on the record related to the timing of imports and seasonality in the industry." The company added that the commission also failed to properly consider evidence pertaining to "import and inventory volumes relative to the overall size of the market, the economic performance of the U.S. industry, and the impact of the extremely high duty rates on the subject imports."
The commission also failed to consider the impact of other tariffs, including duties imposed under Section 301 and the International Emergency Economic Powers Act, which will "likely impede or significantly reduce the quantity of subject imports such that subject imports are unlikely to seriously undermine the remedial effect of the AD Order," the brief said. Kangdi pointed to other evidence in its complaint, including the fact that the "domestic industry earned both an operating and net profit in 2024."
The ITC also failed to account for evidence showing the "subject imports have limited market penetration of the fleet end-use and financing channels," meaning "U.S. producers can rely on fleet sales to maintain profitability while benefitting from the remedial effect of the AD Order in other market segments," Kangdi said.
Regarding Commerce's critical circumstances finding, the exporter said that the agency erred in using import data under Harmonized Tariff Schedule subheading 8703.10.5030, a basket category covering "significant quantities of non-subject merchandise," to find whether imports by "separate-rate companies were 'massive,'" the brief said. Commerce said it didn't consider evidence under other subheadings, since there was nothing on the record showing the import data for subheading 8703.10.5030 wasn't reliable.
Kangdi argued that Commerce failed to consider its argument that "a significant amount of non-subject merchandise is included in the import statistics used to analyze whether there were 'massive' surges in imports for non-examined separate rate companies."