Industry rollout targets are being set while companies try to adapt to the rules, new and old. For the electric mobility sector, in which new technologies are being developed almost daily, these rules can soon become outdated. Bridging the gap between product development and the rules that govern them is a daunting challenge.
These rules impact the bottom line. Tariffs of up to 25% or more can cut into margins. While infrastructure funding, tax proposals, and energy and environmental concerns have dominated the electric mobility space, trade rules and supply chain challenges have received scant attention. This in spite of the important novel provisions for the EV sector in the USMCA, as well as the Section 301 and Section 232 tariffs impacting various materials and components in the supply chain.
Ever since the advent of the global economy, companies have had the ability to seek a competitive advantage and minimize the risks attendant in cross-border transactions by knowing how international trade rules work. With supply chains growing more complex, decisions on the sourcing, manufacturing, and logistics of inputs are increasingly important.
The supply chain for electric mobility products and their components are no different. Knowing how the trade rules impact the supply chain and being able to implement solutions immediately and at the front end is critical for companies to maintain their competitive advantage.
How best to bridge the gap between outdated trade rules and new electric mobility products?
Our team can assist in closing the gaps by leveraging our proven track record in advising industry stakeholders and providing our expert analysis of US trade rules. We work with business executives to help them understand the nexus of policy-making and global supply chains. Led by former senior government attorneys from key trade agencies (e.g. CBP, DOT, DHS, Treasury), and complemented by licensed customs brokers and a core group of non-legal professionals, our team translates the complex arena of trade law into strategic business practices.
Every company and every product is different; and so are the strategies for near and long-term advantage. These include:
- Mitigating the effect of high US tariffs, such as Section 301 China duties, through tariff exclusion requests, product origin and classification analysis, and supply chain restructuring.
- Increasing the competitiveness of a company’s electric mobility products in the US market by an analysis of USMCA qualification status, i.e., the Arent Fox USMCA Diagnostic.
- Determining a company’s product’s eligibility under the Trade Agreement Act (TAA) for federal government procurement.
- Taking advantage of duty-savings programs like duty drawback or special tariff classification (Chapter 98).
- Adopting reasonable care and liability standards to your supply chain to mitigate the risk of onerous CBP and government agency enforcement actions.
- Contracting effectively within a company’s supply chain (suppliers and logistics service providers) for the movement of goods into the US.
- Contracting effectively with domestic partners for the distribution of electric mobility products and their components, including the siting of charging stations.
For Us, Smart in Your World Is Not Simply a Tagline
While many of these strategies may be familiar, the current risks created by the interplay between trade rules and electrification products — which did not exist or were in their infancy when many of the rules were developed— are now a novel and complex problem for many companies.
This is where our team at Arent Fox comes in.
Areas of Focus
- USMCA automotive rules
- US import rulings, regulations and enforcement risk mitigation
- US 301 tariffs on parts imported from China
- US 232 tariffs on certain steel and aluminum imports
- NHTSA standards and proposed rulemaking
- International and domestic manufacturing and supply chain strategies