Special Considerations When Classifying Automotive Goods Under the Harmonized Tariff Schedule of the United States (HTSUS)

The classification of automotive goods and accessories is often challenging given the complexity of the vehicles themselves and the interplay of the HTSUS Rules of Interpretation and Section and Chapter notes.  This article is concerned primarily with “vehicles” which are classifiable under Chapter 87 of the HTSUS, and in particular those classifiable under Headings 8701 through 8705, along with their parts and components.  These are the vehicles that have as their primary use the transportation of people or goods.

Heading 8701 covers all “tractors” (except those described under Heading 8709) which includes the pulling unit of a semi-tractor trailer as well as farm tractors.  Heading 8702 covers motor buses and coaches. Heading 8703 covers vehicles for transporting people such as cars and SUV’s.  Heading 8704 covers vehicles for transporting goods such as cargo vans and pickup trucks.  Heading 8705 covers special purpose motor vehicles other than those principally designed for the transport of persons or goods such as mobile cranes or fire trucks.  Special attention to this group of headings is also important as Chapter 87 has a specific “parts provision” –Heading 8708, which covers “Parts and accessories of the motor vehicles of headings 8701 to 8705”.  However 8708 does not cover all parts used on vehicles, and determining whether a part or accessory of a vehicle is classifiable under 8708 or elsewhere in the HTS is likely the key challenge when classifying automotive goods.

Once it is determined that a subject vehicle is classified under 8701-8705, in order for a part or accessory to be classifiable under the 8708 parts provision, three conditions must be met:

1. They must be identifiable as being suitable for use solely or principally with motor vehicles of headings 8701-8705;

2. They must not be excluded by Section XVII, Note 2; and

3. They must not be more specifically provided for elsewhere in the HTSUS.

The types of vehicles under Heading 8701-8705 are described above, so taking up the second condition Section XVII, Note 2, provides a list of excluded items or categories of items which are not to be identified as “parts” or “parts and accessories” of any of the vehicles of Chapter 87.    These include but are not limited to “parts of general use” such as most fasteners, springs, locks and brackets; many types of Chapter 84 machines or apparatus such as engines and engine parts, pumps, valves and bearings; Chapter 85 electrical apparatus such as wiring harnesses, alternators, generators, batteries and light bulbs; as well as gaskets, seals and articles of vulcanized rubber.  It is critical to note that the above types of items are excluded from classification under 8708 even if the item was specifically designed and can only be used as a part or component on a given vehicle.

The third condition is based on GRI 3(a) which states that when goods are classifiable under two or more headings, the heading which provides the most specific description shall be preferred. The Additional U.S. Rules of Interpretation, which follow the GRIs in the HTSUS, lend further support, providing under 1(c) that “a provision for parts of an article covers products solely or principally used as a part of such articles, but a provision for “parts” or “parts and accessories” shall not prevail over a specific provision for such part or accessory.”

In addition to the above three conditions, one must also be cautious of the exclusions of other Section and Chapter Notes as these may result in some automotive parts and accessories which are specifically provided for in other chapters being classified in heading 8708.  For example the Chapter Notes of Chapter 39 exclude parts of vehicles of Section XVII (which includes Chapter 87). Therefore if a plastic component is specially made to be solely or principally used as a finished auto part and is not otherwise excluded such as a plastic dashboard panel or cover, the item would be classifiable under 8708 rather than as an article of plastic under Chapter 39.

Finally it is also very important to distinguish “Vehicles” from other types of equipment or machinery that also move about and may be used to move or handle materials such as forklift trucks or bulldozers.  These types of mobile machines for tariff purposes are not considered to be vehicles; rather they are considered to be types of machinery classifiable under Chapter 84.  Keeping this important distinction in mind can be very helpful to avoid errors when classifying parts that perform similar functions and are incorporated into both vehicles and mobile machines.  As a parting thought, it is common for articles of Chapter 84 to be incorporated into Chapter 87 vehicles, but it is exceedingly rare to have any articles of Chapter 87 incorporated into Chapter 84 machinery.

By Paul Fudacz, Attorney