The country of origin of electric trucks

N361998 July 10, 2026 OT:RR:NC:N2:201 CATEGORY: Origin Mr. John Peterson Neville Peterson LLP 55 Broadway, Suite # 2602 New York, NY 10006 RE: The country of origin of electric trucks Dear Mr. Peterson: In your letter dated June 2, 2026, you requested a country of origin ruling for electric trucks, on behalf of your clients, ZO Motors North America, LLC and ZO Motors Pacific, LLC. You state the chassis is completely assembled in the Commonwealth of the Northern Mariana Islands (“CNMI”), that you believe it undergoes a double substantial transformation and that the vehicle should be eligible for duty-free entry into the United States under General Note 3(a)(iv) of the Harmonized Tariff Schedule of the United States (HTSUS). The item under consideration has been identified as a medium-duty zero-emission cab-over truck, Model number ZM8, which you state has been engineered as a highly adaptable workhorse for urban delivery, landscaping, and logistics applications. You state that the vehicle has been engineered and built to comply with applicable international and North American motor vehicle safety and homologation standards, including FMVSS and CMVSS, and is intended for lawful operation on public roadways in the United States. The ZM8 is a cab-and-chassis electric truck, designed to accept a variety of commercial cargo bodies depending on end-use requirements. The ZM8 is manufactured on an electric vehicle chassis platform consisting of the structural frame, front and rear axles, suspension systems, braking components, steering systems, and related drivetrain mounting and control elements. At the chassis stage, the ZM8 is configured to accept an electric propulsion system and associated high-voltage components. The ZM8 is propelled exclusively by an electric drivetrain and does not contain an internal combustion engine. The ZM8 has the following specifications: Gross Vehicle Weight Rating (GVWR) of 19,510 pounds. Maximum payload capacity of approximately 12,900 pounds. Axle ratings are 13,670 pounds for the rear axle and 7,050 pounds for the front axle. High-voltage battery-electric propulsion system featuring: Continuous / peak power output: approximately 148 horsepower (continuous) and 268 horsepower (peak). Continuous / peak torque: approximately 184 lb.-ft (continuous) and 332 lb.-ft (peak). High-voltage traction battery with a nominal energy capacity of: Nominal energy capacity of approximately 131 kWh. Operates at a nominal voltage of approximately 540 volts. Supports both AC and DC charging, as follows: AC Level 2 charging (20%–80% state of charge): approximately 4 hours. DC fast charging (20%–80% state of charge): approximately 40 minutes at up to 135 kW. The ZM8 includes an Electric Power Take-Off (EPTO) system capable of supplying 15 kW plus an additional 30kW of power enabling operation of auxiliary commercial equipment, such as refrigerated bodies, lift gates, or other specialized cargo systems. The ZM8 has the following principal dimensions: Chassis / cab length: approximately 328 inches Wheelbase: approximately 177 inches Cab height: approximately 119 inches Cab width: approximately 76 inches Turning circle: approximately 59 feet ZO Motors plans to manufacture the ZM8 in the CMNI on the island of Saipan using a two-stage assembly process. Stage 1: Foreign-sourced components are assembled into a chassis subassembly in Saipan. This chassis subassembly consists of: The truck’s frame Axles (including an integrated electric drive axle) Suspension Wheels Steering system, and related structural and mechanical elements Stage 1 essentially forms the “rolling chassis” of the vehicle. Stage 2: Additional components imported into CNMI from the U.S. and other locations undergo assembly and integration with the chassis in Saipan including: The cab body Battery packs Motor controllers Braking and cooling systems Wiring harnesses Body panels Interior components, and other necessary parts onto the chassis. Stage 2 results in a finished vehicle. Both stages of manufacturing occur entirely within Saipan. The finished ZM8 trucks will then be shipped in compliance with direct-shipment rules to the United States mainland for entry into U.S. commerce. You claim that each assembly stage constitutes a distinct substantial transformation of various inputs, and that together the two-stage assembly amounts to a “double substantial transformation” in the CNMI, for purposes of calculating General Note 3(a)(iv)’s value-content requirement. Accordingly, the foreign materials used to build the chassis subassembly in Stage 1 would be excluded from the foreign content calculation for purposes of duty-free treatment under General Note 3(a)(iv), HTSUS. You state that the remaining foreign materials (those involved in the Stage 2 operations) will represent well under 70% of the final product’s value, such that the finished ZM8 truck should qualify as a product of the CNMI with eligibility for CNMI-origin and duty-free entry into the United States under GN 3(a)(iv). We disagree. To comply with the requirements of GN 3(a)(iv), HTSUS, we must first determine whether the foreign parts imported into the CNMI and used to build the truck are substantially transformed and become a product or manufacture of that possession. We have reviewed your production scenario and find that the foreign parts will be substantially transformed in the CNMI and will become a product of the CNMI. In order to determine whether the cost or value of the foreign components should be considered part of the cost of “foreign materials” or the cost of materials produced in the CNMI for purposes of the 70 percent foreign value limitation under GN 3(a)(iv), we must consider whether such components undergo a “double substantial transformation” in the CNMI. We find that the foreign parts shipped to the CNMI do not undergo a double substantial transformation in the CNMI and their cost/value may not be excluded from the value of the foreign materials for purposes of calculating the 70% foreign value limitation under GN 3(a)(iv). The truck is manufactured in a continuous process, and the chassis is part of the same process and has no commercial purpose other than being part of the final truck. The electric truck may still qualify for duty free tariff status if it does not contain foreign materials which represent more than 70% of the final truck’s value and is shipped directly to the United States from the CNMI. When determining the country of origin for purposes of applying current trade remedies under Section 301 and additional duties, the substantial transformation analysis is applicable. See, e.g., Headquarters Ruling Letter H301619, dated November 6, 2018. The test for determining whether a substantial transformation will occur is whether an article emerges from a process with a new name, character, or use different from that possessed by the article prior to processing. See Texas Instruments Inc. v. United States, 681 F.2d 778 (C.C.P.A. 1982). This determination is based on the totality of the evidence. See National Hand Tool Corp. v. United States, 16 C.I.T. 308 (1992), aff’d, 989 F.2d 1201 (Fed. Cir. 1993). It is the opinion of this office that, based on the information provided, the processes that take place in the Commonwealth of Northern Mariana Islands (CNMI) substantially transform the individual components and parts sourced from North America and China into complete electric trucks. These processes are sufficiently complex and meaningful and result in a single substantial transformation, such that the non-originating components lose their individual identities and become an integral part of new articles, possessing new names, characters and uses. Therefore, it is our opinion that the country of origin for electric trucks will be the Commonwealth of the Northern Mariana Islands (CNMI) for purposes of trade remedies. The holding set forth above applies only to the specific factual situation and merchandise description as identified in the ruling request. This position is clearly set forth in Title 19, Code of Federal Regulations (CFR), Section 177.9(b)(1). This section states that a ruling letter is issued on the assumption that all of the information furnished in the ruling letter, whether directly, by reference, or by implication, is accurate and complete in every material respect. In the event that the facts are modified in any way, or if the goods do not conform to these facts at time of importation, you should bring this to the attention of U.S. Customs and Border Protection (CBP) and submit a request for a new ruling in accordance with 19 CFR 177.2. Additionally, we note that the material facts described in the foregoing ruling may be subject to periodic verification by CBP. This ruling is being issued under the provisions of Part 177 of the Customs and Border Protection Regulations (19 C.F.R. 177). A copy of the ruling or the control number indicated above should be provided with the entry documents filed at the time this merchandise is imported. If you have any questions regarding the ruling, please contact National Import Specialist Matthew Sullivan at matthew.sullivan@cbp.dhs.gov. Sincerely, (for) James P. Forkan Director National Commodity Specialist Division