Pending further investigation, the U.S. Department of Commerce (DOC) has ordered that cash deposits be collected on imports of Chinese-made Samsung and LG washers, which it believes are being sold in the U.S. at less than fair value.
The preliminary ruling was triggered by an antidumping petition filed by Whirlpool in December. The Commerce Department said the sanctions — set at a rate of nearly 50 percent for LG and 112 percent for Samsung — are being imposed to create “a level playing field” in the U.S. marketplace.
The DOC hit other Chinese laundry exporters with a preliminary dumping margin of 80.5 percent, and made Samsung’s penalty retroactive to April.
The agency is expected to make a final ruling on the allegations in December, and will then pass the case on to the International Trade Commission (ITC), should it determine that Samsung and LG had engaged in predatory pricing. The ITC would then make a final determination in January 2017, after which the DOC could conceivably impose import tariffs on the laundry products by Jan. 30.
Whirlpool’s petition was the latest in a long series of antidumping and patent-infringement charges brought by the world’s largest majap maker against its Korean competitors. In this most recent case, Whirlpool contended that Samsung and LG skirted previous antidumping rulings and tariffs on Korean and Mexican-made washers by moving laundry production to China.
Whirlpool president/COO Mark Bitzer described the Commerce Department ruling as “an important step forward in an effort to stop serial dumping practices by Samsung and LG and uphold free and fair trade practices” that ensure “the highest level of innovation and choice for consumers.”
In an earlier suit brought by Whirlpool in 2012, the Commerce Department determined that Samsung washers were unlawfully subsidized by the Korean government, and that the company was undercutting U.S. competitors on price. LG was cleared of similar charges, and the World Trade Organization (WTO) later contested DOC’s findings.
In other Whirlpool news, the company said second-quarter earnings rose nearly 81 percent, to $320 million, on flat net sales of $5.2 billion, for the three months ended June 30. Sales were impacted by unfavorable currency fluctuations and would have risen 3 percent otherwise.
In North America, sales rose 3.7 percent to $2.8 billion and apples-to-apples operating profit rose 17 percent to $340 million, or 12.3 percent of sales.
Chairman/CEO Jeff Fettig attributed the quarter’s record earnings and expanded margins to “innovative new products and strong ongoing cost productivity programs.”
Looking ahead, Whirlpool is sticking to its full-year forecast of a 5 to 6 percent increase in U.S. unit shipments industrywide in 2016.
