TESTIMONY OF RODDEY DOWD JR., CEO OF CHARLOTTE PIPE AND FOUNDRY COMPANY ON BEHALF OF THE AMERICAN FOUNDRY SOCIETY

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1 Comments Regarding Causes of Significant Trade Deficits for 2016 Docket No. ITA Written Comments Submitted by Charlotte Pipe and Foundry Company TESTIMONY OF RODDEY DOWD JR., CEO OF CHARLOTTE PIPE AND FOUNDRY COMPANY ON BEHALF OF THE AMERICAN FOUNDRY SOCIETY COMMENTS PURSUANT TO PRESIDENTIAL EXECUTIVE ORDER TRADING PARTNERS WITH WHICH THE UNITED STATES HAS SIGNIFICANT TRADE DEFICITS IN GOODS MAY 18, 2017 OVERVIEW: U.S. FOUNDRIES ARE CRITICAL TO THE ECONOMY, INFRASTRUCTURE AND DEFENSE Charlotte Pipe and Foundry is a 116 year-old manufacturer of cast iron and plastic pipe and fittings for commercial and residential plumbing systems. We are a 5th generation family-owned and operated manufacturer. Charlotte Pipe is headquartered in Charlotte, NC, and has seven plant locations across the United States. As a domestic-only manufacturer, Charlotte Pipe is proud to support 1,400 American middle class jobs and families and we have not had a layoff of our workforce since Charlotte Pipe is a proud member of the U.S. metalcasting industry 1, the sixth-largest industry in America and the second-largest supplier of castings in the world, after China. Metal castings are integral to virtually all U.S. manufacturing activities. In the U.S., castings are used to produce 90% of all manufactured durable goods and nearly all manufacturing machinery. The American Foundry Society (AFS) is the major trade and technical association for the North American metalcasting industry. The association has more than 8,000 members representing metalcasting firms, their suppliers and customers. Our industry is composed of 1,956 facilities 2 manufacturing castings made from iron, steel and aluminum alloys, which have thousands of applications. Foundries produce both simple and complex castings of infinite variety, as well as highly-customized components that would be difficult or expensive to manufacture through other means, such as machining, forging, welding or rolling. In addition to underpinning the energy, transportation, aerospace and defense industries, countless sectors in the United States depend upon the existence of metalcastings, including those related to automotive, construction, agriculture, medical supplies, computers, sporting goods, textiles, plumbing, gas and electrical transmission, renewable energy, water infrastructure and mining. The American metalcasting industry provides employment for more than 200,000 people directly and supports thousands of other jobs indirectly. Our energy-intensive, trade-exposed industry supports a payroll of more than $9 billion and sales of more than $30 billion annually. Metalcasting plants are predominately small businesses, with 80% of domestic metalcasters having fewer than 100 employees. U.S. metalcasting facilities 1 NAICS Codes Foundries 3351 Ferrous metal foundries; Iron foundries; Steel investment foundries; Steel foundries (except investment); Nonferrous metal foundries; Aluminum foundries (except die-casting); and, Other nonferrous metal foundries (except die-casting) U.S. Census Bureau, Industry Statistics Portal Most Markets to See Small Gains, METAL CASTING DESIGN & PURCHASING Jan/Feb 2017, page

2 are located in every state of the country, however the majority of the capacity (77%) is located in 10 states: Alabama, Illinois, Indiana, Michigan, Ohio, Pennsylvania, Tennessee, Texas, Virginia, and Wisconsin. Foundries are the mainstay of national defense. All sectors of the U.S. military are reliant on metalcastings for jet fighters, ships, tanks, trucks, weapon systems and other vital operations. Metalcasters also produce more than 600 lbs of cast metal for every vehicle on the road. Automobiles and other transportation equipment utilize 31% of all castings produced in the U.S. - including engine blocks, crankshafts, camshafts, cylinder heads, brake drums or calipers, intake manifolds, transmission housings, differential casings, U-joints, suspension parts, flywheels, engine mount brackets, front-wheel steering knuckles, hydraulic valves, and a multitude of other castings all parts used in military vehicles as well. TRADE IMPACTS ON THE METALCASTING INDUSTRY Imported castings now comprise nearly 25 percent of the market and of that almost 25 percent of those imports are coming from China [See Figure 1 below]. As a result of the increasing volumes of unfairly traded imports from China, the domestic iron and steel metalcasting industry's production, sales and ability to maintain the employment of its workforce have all suffered, as has the industry's profitability. According to a recent survey of AFS members, 88% stated they were negatively impacted by foreign competition, with China being the largest source of foreign imports, followed by Brazil and India. China accounts for 44 percent of global casting production. Combined, the U.S. and India account for just 20 percent. Figure 1 - Imports of Metal Castings to U.S. By Country Figure 2 - Leading Global Metalcasting Countries in 2012 (Metric tons) 1. China: 42.5 million 30,000 plants 2. U.S.: million 2,010 plants 3 3. India: million 4,500 plants 4. Japan: 5.34 million 2,113 plants 5. Germany: 5.21 million 605 plants 3 Data collected by AFS in 2013 shows that number of U.S. foundries shrunk from 2,010 in 2012 to 1,987 in 2013.

3 6. Russia: 4.3 million 1,240 plants 7. Brazil: 2.86 million 1,277 plants 8. Korea: 2.44 million 897 plants 9. Italy: 1.96 million 1,111 plants 10. Ukraine: 1.53 million 805 plants CHINA For decades, China has pursued an export-oriented growth strategy in which they rely upon the United States and other markets to consume their exports rather than increasing their internal consumption.

4 China is responsible for America s largest bilateral trade deficit, at $367 billion in 2015, dwarfing any other. This deficit grew twentyfold from In theory, such a large, persistent deficit would drive up the value of the yuan and bring China s surplus down, but this has not happened due to a range of Chinese government policies including currency manipulation and government subsidies to export industries. In addition, after 13 years China continues to fail to live up to the obligations Beijing agreed to when joining the WTO. China has not liberalized its economy as promised and continues a policy of mercantilist state capitalism. Metals, manufacturing and trade groups agree that China still fails to pass the U.S. Commerce Department s sixcriterion test for market economy status, which evaluates currency convertibility, wage rates bargaining, joint venture or foreign investment limitations, government ownership or control of production, government control over enterprises resource allocation and prices, among other factors. COMMENTS PURSUANT TO PRESIDENTIAL EXECUTIVE ORDER TRADING PARTNERS WITH WHICH THE UNITED STATES HAS SIGNIFICANT TRADE DEFICITS IN GOODS Pursuant to Executive Order of March , the Secretary of Commerce and the United States Trade Representative (USTTR), in consultation with the Secretaries of State, the Treasury, Defense, Agriculture, and Homeland Security and the heads of any other executive departments or agencies with relevant expertise, as determined by the Secretary of Commerce and the USTR, shall prepare and submit to the President an Omnibus Report on Significant Trade Deficits. Below are my comments relative to this executive order. (a) Assess the major causes of the trade deficit including, as applicable, differential tariffs, non-tariff barriers, injurious dumping, injurious government subsidization, intellectual property theft, forced technology transfer, denial of worker rights and labor standards, and any other form of discrimination against the commerce of the United States or other factors contributing to the deficit; China s metalcasting industry remains government-owned and controlled and heavily subsidized. China continues to protect and increase its exports by manipulating its currency, raw material markets and border measures for metalcastings. The United States must take aggressive action to combat these unfair trade practices in order to preserve and strengthen our manufacturing base, which is critical to our national defense and military capabilities. China does not operate on market principles of cost or pricing structures, so that sales of its products in the United States do not reflect the fair value of the merchandise. According to a Wall Street Journal analysis, Chinese government support includes billions of dollars in subsidies and other benefits to state-owned companies. Nearly 3,000 domestic-listed Chinese companies in 2015 reported that government aid rose to more than 119 billion yuan last year, or more than $18 billion, compared with about 92 billion yuan in Reported subsidies have risen roughly 50% since 2013, based on figures from Shanghai data provider Wind Information Co. Under Chinese accounting standards, such aid can be cash or other perks like subsidized power or land, but doesn t include some other support, such as capital injections from the government as an equity shareholder. All of this support gives Chinese firms an unfair advantage over U.S. domestic manufacturers who have seen their costs rise significantly due to rising raw material costs and the onslaught of energy, environmental and labor regulations in the United States over the last eight years.

5 (b) Assess whether the trading partner is, directly or indirectly, imposing unequal burdens on, or unfairly discriminating in fact against, the commerce of the United States by law, regulation, or practice and thereby placing the commerce of the United States at an unfair disadvantage; China is directly and indirectly unfairly discriminating against the commerce of the United States by law, regulation and practice through a wide range of state support, including cash grants; equity infusions; preferential loans and directed credit; land use subsidies; subsidies for utilities, raw material price controls; tax policies and benefits; currency policies; and lax enforcement of environmental regulation. Cash Grants and Capital Infusions Cash grants and capital infusions are subsidies in the most conventional sense. They are essentially an injection of government capital to provide support for a foundry s commercial activities. All levels of the Chinese government, from national to provincial and municipal tiers, provide this type of subsidy. Equity Infusions and Conversions The Chinese government sometimes provides a direct cash injection or debt relief in exchange for equity in a company, usually in the form newly created shares. In the case of equity infusions, the simplest form of support in exchange for equity, the government simply buys more shares in a company as a way to inject capital. More typically the government will provide debt relief in exchange for these shares, which it usually does either by requiring state-owned banks to forgive the debt or by arranging for non-performing debt to be transferred to an asset management company. Since many foundries are already state-owned, the government is essentially just increasing the number of shares it holds in a company without changing its ownership position in the enterprise. As such, an equity infusion is essentially a direct cash grant or debt relief for the company; the only difference is the nominal exchange of equity. Preferential Loans and Directed Credit The Chinese government channels financing to certain industries and enterprises that reinforce its policy directives through state-owned banks that dominate the banking sector. In what has become known as policydriven lending, loans are granted based on alignment with central or provincial governments policy directives, rather than creditworthiness or other market-based factors. This financing usually comes at extremely low, nonmarket interest rates on non-commercial terms, and often shores up inefficient state-owned companies. Land-Use Subsidies There is no private ownership of land in China; all land remains the property of the state. While businesses can acquire land-use rights and own buildings and structures on that land, the government ultimately owns the land and has the authority to determine how it can be allocated. The Ministry of Land and Resources and its local Land and Resource Bureaus oversee land-use registration and can grant land-use rights for a definite or indefinite period of time. Thus, the government is in a position to offer favored enterprises cheap prices for land or even provide it for free. Other forms of government support for land use include direct land-use subsidies, compensation for land-use expenses and relocation funding.

6 Subsidies for Utilities One way to provide sizable support to favored industries indirectly is by enabling cheap use of utilities, particularly electricity. Since foundries are very energy-intensive, this can amount to a huge advantage. Local authorities control local utilities and have the authority to give certain enterprises preferential rates and deep discounts. Tax Policies and Benefits The Chinese government at both national and local levels provides a variety of tax exemptions, reductions, and credits which directly benefit favored industries. China s use of tax rebates on exports has led to strong objections from trading partners who argue that the practice does not comply with WTO rules. Lax Enforcement of Environmental Regulation One of the ways the government has provided indirect support to favored sectors is by not strictly enforcing regulations on environmental protection. While China s central government has issued increasingly stringent environmental protection policies, reaching the same level of standards as set by the U.S. and European countries, these regulations are not implemented or enforced at the local level. Industries favored by the government, as well enterprises that contribute significantly to local economic development, have been spared. This problem persists due to inherent problems with the structure of the Chinese government and how these regulations are enforced. There is an ongoing struggle between local governments, which need to maintain GDP growth and tax revenue by whatever means necessary, and the state, which needs to show the public that it is responding to environmental concerns. Currency Policies The People s Bank of China, China s central bank, controls the value of the RMB (yuan) against the dollar by purchasing U.S. dollars and securities and selling RMB, or vice versa. Foreign governments have been arguing for years that by keeping its currency artificially low, China makes its products comparatively inexpensive on the global market. While the U.S. government has not labeled China a currently manipulator, many argue that Chinese manufacturing in particular benefits from a weak currency, in conjunction with all of the other supporting and beneficial policies, allowing it an unfair trading advantage. There are periods when China actually does the opposite of devaluation of its currency and keeps the currency artificially strong, fighting against macroeconomic pressures to devalue, given that this would likely provoke an international backlash, and potentially undo any benefits to exports. Furthermore, China will from time to time keep the currency relatively high to prevent capital from flowing out of China. Raw Material Price Controls The Chinese government has employed macro-controls to keep the prices of vital raw materials low. This has included placing export restrictions on certain materials to ensure domestic supply is abundant. Raw material prices are thus indirectly subsidized, and favored industries can enjoy below-market prices. Moreover, stateowned enterprises (SOEs) can essentially buy raw materials from each other at very low costs.

7 In the case of cast iron foundries, scrap steel and iron are the primary raw materials. Scrap is a global commodity and prices are set by global supply and demand. This month, the price of scrap metals used in our industry was $322 per ton. Chinese foundries melt the scrap into cast iron pipes and fittings, ship the finished goods from the inland foundries to Chinese ports, pay $2,700-$3,200 per each 40-foot container to ship the products across the Pacific Ocean, through the Panama canal and up the East Coast of the United States into the port of New York, where they sell the finished goods for $422 per ton. How is it possible to absorb all the production, operating and freight costs associated with making and shipping cast iron soil pipe from inland China to New York and still make a profit with a $100 spread between raw material costs and the final selling price? (c) Assess the effects of the trade relationship on the production capacity and strength of the manufacturing and defense industrial bases on the United States China s overproduction of steel, aluminum, iron and other industrial goods has driven down global prices and crippled competitors, leading to thousands of lost jobs in the U.S. The U.S. metalcasting industry is made up of 1,956 facilities, down from 2,800 in This reduction can be attributed to the recession, technological advancements and over-zealous regulation, but also in large part to the unfair trade practices listed above. U.S. metalcasting capacity is 15.2 million tons with the industry forecast to operate at 75% of capacity in This table shows the growth of imported castings into the U.S. as a percentage of casting demand since 1997 (when the data was first tracked). Growth of Imported Castings into the U.S. as a Percentage of Casting Demand Based on the data secured through the 2015 Annual Census of World Casting Production by Modern Casting magazine, China shipped 45.6 million metric tons of castings in 2015 compared to million metric tons by India and 10.4 by the U.S. Following the U.S. and India are Japan (5.4 million metric tons), Germany (5.3), Russia (4.2), Brazil (2.3), Korea (2.63), Italy (2.03) and Turkey (1.85).

8 The closure of U.S. foundries and the reduction of capacity represent a national security threat to the United States. The metalcasting industry supplies various end-use markets (by NAICS) used for military purposes. Without the capability to supply these sectors, the United States would not be able to defend itself. (See Annex A for a comprehensive list of military-related NAICS for which the metalcasting industry is a critical supplier). Amid an influx of unfairly priced imports from China, U.S. jobs are being eliminated, dramatically reducing the United States critically important defense industrial base. If this is allowed to continue, U.S. manufacturers of military equipment and machinery will be forced to import components from China and elsewhere, limiting the country s ability to respond to a military threat. In the cast iron soil pipe and fittings sector, we have seen the growth of imports as a percentage of total tonnage rise from less than 4 percent in 1997 to 13.5 percent in The percentage growth just since the recovery from the Great Recession has been nearly three-fold. (d) Assess the effects of the trade relationship on employment and wage growth in the United States An analysis conducted by the Coalition for a Prosperous America estimates that each $1 billion of additional imports into the U.S. costs the nation 4,552 jobs. On this basis, the rise in total imports from 2009 to 2015 has meant the loss of over 3 million jobs. In this century, 844 foundries have shut down while successive administrations in Washington have sat by and done nothing to re-balance our trade relationships and save jobs.

9 Other Relevant Questions (a) Which bilateral trade deficits are structural or cyclical rather than mercantilist-driven? Many would argue based on the litany of subsidies and support detailed above that the bilateral trade deficit with China is structural and mercantilist-driven, and not cyclical. (b) To what extent are non-market economies operating within a market-based system creating trade imbalances? China s macro-economic policy of mercantilist state capitalism and its wide range of state support for key, favored industrial sectors puts global free-market competitors at a distinct disadvantage. China wants to be recognized within the WTO as a market economy for trade purposes but it has not lived up to any of its WTO obligations concerning currency convertibility, wage rates bargaining, joint venture or foreign investment limitations, government ownership or control of production, government control over enterprises resource allocation and prices, among other factors. Beijing has not addressed these issues because they are what give Chinese companies an advantage over global trading partners. (c) To what extent does chronic industrial overcapacity resulting from government subsidies affect the U.S. trade deficit? Beijing s ongoing failure to uphold its WTO commitments, ineffective efforts to cut industrial overcapacity and unfair treatment of U.S. companies are straining the bilateral relationship. In 2015, the U.S. goods trade deficit with China increased by 6.5 percent year-on-year to $367.2 billion, a new record; in the first eight months of 2016, the goods deficit was $225 billion. Rather than closing industrial production facilities and laying-off workers, Beijing is exporting its surplus production to the detriment of U.S. and other foreign competitors. As a result, U.S. industries are struggling, with iron, steel and aluminum producers shedding capacity, cutting employment and reducing capital expenditures. (d) Have free trade agreements contributed to bilateral trade deficits and how? Free trade has caused more U.S. jobs losses than gains, especially for higher-wage jobs and many free trade agreements are bad deals for the U.S. While corporate profits soar, individual wages stagnate because millions of American jobs can be performed at a fraction of the cost in the developing world. When he signed NAFTA on September 14, 1993, President Bill Clinton exulted, "I believe that NAFTA will create a million jobs in the first five years of its impact. And I believe that that is many more than will be lost... " But according to a 2013 report by the Economic Policy Institute, NAFTA caused the loss of some 700,000 jobs as production moved to Mexico. To be sure, there were some job gains along the border in service and retail sectors resulting from increased trucking activity, but these gains are small in relation to the loses, and are in lower paying occupations. The vast majority of workers who lost jobs from NAFTA suffered a permanent loss of income. NAFTA became the template for the rules of the emerging global economy, in which the benefits would flow to capital and the costs to labor. NAFTA s principles were applied to the WTO and to a bilateral relationship with

10 China under which employers of China s huge supply of low-wage workers were allowed access to U.S. markets in exchange for allowing American multinational corporations the right to invest in production there. (e) To what extent have weak enforcement and dispute resolution mechanisms inadequately addressed trades issues that result in trade deficits? Many industries, like cast iron soil pipe and fittings, are just too small to afford the cost of dumping or countervailing duty cases or WTO cases. And these trade rules are structured so that industries have to be able to prove significant injury for a period of time a look backward at steadily rising import market share and steadily decreasing domestic industry profitability until it s almost too late for the relief to save jobs (which is what happened to the U.S. aluminum industry). And it can take years and millions of dollars to successfully execute a trade case against mercantilist trading partners like China. We need to make use of existing enforcement and dispute resolution mechanisms that are forward-looking and proactively protect key sectors necessary for national defense, energy and infrastructure, such as Section 232 of the Trade Expansion Act of 1962, a rarely-used provision of U.S. trade law that the new administration is now pursuing to support a few key industry sectors like steel and aluminum.

11 ANNEX A A comprehensive list of military and critical infrastructure-related NAICS for which the metalcasting industry is a primary supplier: Small Arms Manufacturing This U.S. industry comprises establishments primarily engaged in manufacturing small arms, other ordnance, and/or ordnance accessories Mining Machinery and Equipment Manufacturing This U.S. industry comprises establishments primarily engaged in (1) manufacturing underground mining machinery and equipment, such as coal breakers, mining cars, core drills, coal cutters, and rock drills and (2) manufacturing mineral beneficiating machinery and equipment used in surface or underground mines Oil and Gas Field Machinery and Equipment Manufacturing This U.S. industry comprises establishments primarily engaged in (1) manufacturing oil and gas field machinery and equipment, such as oil and gas field drilling machinery and equipment, oil and gas field production machinery and equipment, and oil and gas field derricks; and (2) manufacturing water well drilling machinery Industrial Machinery Manufacturing This industry comprises establishments primarily engaged in manufacturing agricultural and farm-type, construction, mining, sawmill and woodworking, and plastics and rubber products-making industrial machinery Metalworking Machinery Manufacturing This industry comprises establishments primarily engaged in manufacturing metalworking machinery, such as metal cutting and metal forming machine tools; cutting tools; and accessories for metalworking machinery; special dies, tools, jigs, and fixtures; industrial molds; rolling mill machinery; assembly machinery; coil handling, conversion, or straightening equipment; and wire drawing and fabricating machines Special Die and Tool, Die Set, Jig, and Fixture Manufacturing This U.S. industry comprises establishments, known as tool and die shops, primarily engaged in manufacturing special tools and fixtures, such as cutting dies and jigs Cutting Tool and Machine Tool Accessory Manufacturing This U.S. industry comprises establishments primarily engaged in manufacturing accessories and attachments for metal cutting and metal forming machine tools Machine Tool Manufacturing This U.S. industry comprises establishments primarily engaged in (1) manufacturing metal cutting machine tools (except handtools) and/or (2) manufacturing metal forming machine tools (except handtools).

12 Rolling Mill and other Metalworking Machinery Manufacturing This U.S. industry comprises establishments primarily engaged in manufacturing rolling mill machinery and equipment for metal production Engine, Turbine, and Power Transmission Equipment Manufacturing This industry comprises establishments primarily engaged in manufacturing turbines, power transmission equipment, and internal combustion engines (except automotive gasoline and aircraft) Speed Changer, Industrial High-Speed Drive, and Gear Manufacturing This U.S. industry comprises establishments primarily engaged in manufacturing gears, speed changers, and industrial high-speed drives (except hydrostatic) Navigational, Measuring, Electro-medical, and Control Instruments Manufacturing This industry comprises establishments primarily engaged in manufacturing navigational, measuring, electromedical, and control instruments. Examples of products made by these establishments are aeronautical instruments, appliance regulators and controls (except switches), laboratory analytical instruments, navigation and guidance systems, and physical properties testing equipment Heavy Duty Truck Manufacturing This industry comprises establishments primarily engaged in (1) manufacturing heavy duty truck chassis and assembling complete heavy duty trucks, buses, heavy duty motor homes, and other special purpose heavy duty motor vehicles for highway use or (2) manufacturing heavy duty truck chassis only Aerospace Product and Parts Manufacturing This industry comprises establishments primarily engaged in one or more of the following: (1) manufacturing complete aircraft, missiles, or space vehicles; (2) manufacturing aerospace engines, propulsion units, auxiliary equipment or parts; (3) developing and making prototypes of aerospace products; (4) aircraft conversion (i.e., major modifications to systems); and (5) complete aircraft or propulsion systems overhaul and rebuilding (i.e., periodic restoration of aircraft to original design specifications) Aircraft Manufacturing This U.S. industry comprises establishments primarily engaged in one or more of the following: (1) manufacturing or assembling complete aircraft; (2) developing and making aircraft prototypes; (3) aircraft conversion (i.e., major modifications to systems); and (4) complete aircraft overhaul and rebuilding (i.e., periodic restoration of aircraft to original design specifications) Aircraft Engine and Engine Parts Manufacturing This U.S. industry comprises establishments primarily engaged in one or more of the following: (1) manufacturing aircraft engines and engine parts; (2) developing and making prototypes of aircraft engines and engine parts; (3) aircraft propulsion system conversion (i.e., major modifications to systems); and (4) aircraft

13 propulsion systems overhaul and rebuilding (i.e., periodic restoration of aircraft propulsion system to original design specifications) Railroad Rolling Stock Manufacturing This industry comprises establishments primarily engaged in one or more of the following: (1) manufacturing and/or rebuilding locomotives, locomotive frames and parts; (2) manufacturing railroad, street, and rapid transit cars and car equipment for operation on rails for freight and passenger service; and (3) manufacturing rail layers, ballast distributors, rail tamping equipment and other railway track maintenance equipment Ship and Boat Building This industry comprises establishments primarily engaged in operating shipyards or boat yards (i.e., ship or boat manufacturing facilities). Shipyards are fixed facilities with drydocks and fabrication equipment capable of building a ship, defined as watercraft typically suitable or intended for other than personal or recreational use. Boats are defined as watercraft typically suitable or intended for personal use. Activities of shipyards include the construction of ships, their repair, conversion and alteration, the production of prefabricated ship and barge sections, and specialized services, such as ship scaling Military Armored Vehicle, Tank, and Tank Component Manufacturing This U.S. industry comprises establishments primarily engaged in manufacturing complete military armored vehicles, combat tanks, specialized components for combat tanks, and self-propelled weapons All Other Transportation Equipment Manufacturing This U.S. industry comprises establishments primarily engaged in manufacturing transportation equipment (except motor vehicles, motor vehicle parts, boats, ships, railroad rolling stock, aerospace products, motorcycles, bicycles, armored vehicles and tanks).