US Launches Global Washer Trade War

Tyler Durden's picture
Today, the US means business; the clean laundry business. via Bloomberg:


Commerce Preliminarily Finds Dumping of Imports of Large Residential Washers from Mexico and the Republic of Korea
  • On July 30, 2012, the Department of Commerce (Commerce) announced its affirmative preliminary determinations and postponement of final determinations in the antidumping duty (AD) investigations of imports of large residential washers from Mexico and the Republic of Korea (Korea).
  • For the purposes of AD investigations, dumping occurs when a foreign company sells a product in the United States at less than fair value.
  • Commerce preliminarily determined that Mexican and Korean producers/exporters sold large residential washers in the United States at dumping margins of 33.30 percent to 72.41 percent, and 9.62 percent to 82.41 percent, respectively.
  • In the Mexico investigation, mandatory respondents Electrolux Home Products, Corp. NV/Electrolux Home Products De Mexico, S.A. de C.V. (Electrolux), Samsung Electronics Mexico S.A. de C.V. (Samsung), and Whirlpool International S. de R.L. de C.V. (Whirlpool) received preliminary dumping margins of 33.30 percent, 72.41 percent, and 72.41 percent, respectively. The margins for Samsung and Whirlpool were based on adverse facts available (AFA) because of their failure to cooperate in the investigation. All other Mexican producers/exporters received a preliminary dumping margin of 33.30 percent.
  • In the Korea investigation, mandatory respondents, Daewoo Electronics Corporation (Daewoo), LG Electronics, Inc. (LG), and Samsung Electronics Co., Ltd. received preliminary dumping margins of 82.41 percent, 12.15 percent, and 9.62 percent, respectively. The margin for Daewoo was based on AFA because of its failure to cooperate in the investigation. All other Korean producers/exporters received a preliminary dumping margin of 11.36 percent.
  • As a result of the preliminary affirmative determinations, Commerce will instruct U.S. Customs and Border Protection (CBP) to require a cash deposit based on these preliminary rates, adjusted for export subsidies, as appropriate, found in the preliminary determination of the companion Korea countervailing duty investigation. Pursuant to a change of practice announced in accordance with Commerce’s Trade Law Enforcement Initiative, for investigations based on petitions filed on or after November 2, 2011, Commerce now requires importers to post cash deposits rather than bonds to cover estimated duties between the preliminary determination and any subsequent order. (76 FR 61042, October 3, 2011)
  • The petitioner for these investigations is Whirlpool Corporation (corporate headquarters in Benton Harbor, MI, with washing machine production in Clyde, OH).
  • The merchandise subject to these investigations is all large residential washers and certain subassemblies thereof from Korea and Mexico. For purposes of these investigations, the term “large residential washers” denotes all automatic clothes washing machines, regardless of the orientation of U.S. Department of Commerce | International Trade Administration the rotational axis, except as noted below, with a cabinet width (measured from its widest point) of at least 24.5 inches (62.23 cm) and no more than 32.0 inches (81.28 cm). Excluded from the scope are stacked washer-dryers and commercial washers designed for the “pay per use” market. Also excluded from the scope are automatic clothes washing machines with a vertical rotational axis and a rated capacity of less than 3.70 cubic feet.
  • Imports of the subject merchandise are provided for under the following categories of the Harmonized Tariff Schedule of the United States (HTSUS): HTSUS 8450.11.0040, 8450.11.0080, 8450.20.0090, 8450.90.2000, and 8450.90.6000). Some HTSUS subheadings include basket categories and may cover both subject and non-subject merchandise. These HTS numbers are provided for convenience and Customs purposes only; the written description of the scope is dispositive.
  • n 2011, imports of large residential washers from Mexico and Korea were valued at an estimated $434 million and $569 million, respectively.

Commerce is currently scheduled to make its final determinations for Mexico and Korea in December 2012.
If Commerce makes affirmative final determinations, and the U.S. International Trade Commission (ITC) makes affirmative final determinations that imports of large residential washers from Mexico and/or Korea materially injure, or threaten material injury to, the domestic industry, Commerce will issue AD orders. If either Commerce or the ITC’s final determination is negative, no AD order will be issued. The ITC will make its final injury determinations in the Mexico and Korea investigations in January 2013.

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fireangelmaverick's picture

I thought the US would appreciate additional devices to wash the cocaine of our money bills.

Concentrated power has always been the enemy of liberty.'s picture

"Fair Value" is best determined by keeping competition out...

Trade idea;  long bureaucrats/short entreprenuers

machineh's picture

Raise prices on household capital goods in a recession: GREAT IDEA!

We're from Washington, and we're here to help ... (make a bad situation worse).

Manthong's picture

Who cares.. they are all junk nowadays anyway.

phalfa5's picture

It will all wash out in the end

bank guy in Brussels's picture

From the title I thought this article was about the other kind of 'washers' ...

Like in that famous scene from Sam Peckinpah's 1969 'The Wild Bunch', after some of the gang get killed robbing a bank ...

And they open up the bags of 'loot' ... and one of the dumb gang members thinks they have stolen 'silver rings' ...

And the Ernest Borgnine character (RIP, Ernie) says, 'Silver rings, your butt! Them's WASHERS!'

'The Wild Bunch has a good laugh'

Jay Gould Esq.'s picture

"Oh my, what a bunch. Big, tough one, eh ? Ha, ha, ha. Here you are, with a handful of holes, a thumb up your ass, and a big grin to pass the time of day with !"

Edmond "D.O.A." O'Brien was barely recognizable in this one...a fine actor...classic Peckinpah.

seabiscuit's picture

Anyone? Smoot-Hawley anyone? Anyone?


Buehler? Buehler?

Bastiat's picture

Trade war? We'll fight dirty.

saturn's picture

So you wish to devaluate it completely?

Almost Solvent's picture

Happy to keep my 1992 Kenmore washer operational.

Just spent $20 on a new fuse last year. The matching 1992 Kenmore dryer is still working just fine with a new thermal fuse and cleaned out the ductwork this past spring.


BandGap's picture

Same here, Sears made a good warshing machine back in the day.

Is this an indication of overstock? Can't bring out next year's turbo diesel powered, environmentally friendly models that don't wash worth a shit until you clear out the old ones.

Temporalist's picture

Now the Maytag repairman will really be out of work.

duo's picture

Didn't Whirlpool move all their plants to Mexico, and now wants a tariff on Mexican-made washers not made by them?  The irony.

dark pools of soros's picture

NAFTA was about getting cheap labor not about competing fairly... Why pay labor when you can pay a lobbyist?

Dr. No's picture

Selling washers for less than fair value hurts the consumer how?  Where can I get some of these below value washers before the government protects me from my own cost saving ignorance?

dracos_ghost's picture

Well corporations are people too don't cha know. I believe GE is the consumer being hurt the most.

UGrev's picture

when a company can undercut the competition, and the competition goes out of business.. the following price increases to the products of the winner increase the size of your asshole by a margin of 200% beyond fair market price. 

So what was your question again?

alangreedspank's picture

That assumes all competition goes bankrupt at the same, which just doesn't happen. At least I don't feel like I should pay insurance against such an occuring event.

UGrev's picture

it assumes that competition cannot compete, whether they exist temporarily as a start up or existed prior. The barrier to enter is too great. That's where one would hope anti-trust would come into play.... \_^oo^_/

Dr. No's picture

Dude, there are 8 companies on that list.  Are they all in cahoots?

UGrev's picture

...and do you think EVERYONE of them doesn't want to be the primary vendor in any market?  really?  You better open your eyes real fucking quick. These companies gun for the top the provider in ANY market, even if it's just regional.  

Aside from that, Samsung is listed twice.. 

Dr. No's picture

Is it bad a company try to be number one??  I guess I dont see your point.  These compaies (7) are trying to sell below "fair market value".  At what point do you conceed price fixing and just say "you know, thats a damn good price..."

UGrev's picture

It's bad when a company does immoral and unethical things to acquire the number one spot.. In that context, YES. Otherwise.. go for it and don't be evil. Did that scenario ever cross your mind or is that the first time you've heard of this concept?

Dr. No's picture

Lol. So selling cheap washers is Evil. Lol.

alangreedspank's picture

Yep, and that coming from a self proclaimed libertarian. So many confused individuals...

alangreedspank's picture

You mention barrier of entry as a problem not caused by the governement in the first place and then move on on how the governement could solve the problem. Failed analysis in my book, but good enough for a cushy job at the Fed.


UGrev's picture

When the barrier of entry is created using unethical and immoral tactics, then yes.. some "entity" has to break that shit up. That entity just so happens to be our justice system which has an anti-trust law in place. So.. what's your point again?

alangreedspank's picture

Anti-trust laws were created by corporations to sue corporations. Not for the state to "clean up" markets as people are willing to think.

You're basically paying taxes for stuff that would happen in a free market anyways. It's like paying bureaucrats to enforce the law of gravity.

Offthebeach's picture

Leftist deluded fantasy.
How about some factual cases?
Find me one MBA course, book that preaches that as a successful strategy?
There isn't one.
99.9% of everything is not sold direct to the customer. Try telling Wal-Mart that you are going to, at a loss, sell to them and you don't want them to keep the difference. HA!
See if GM/FORD dealers don't gobble up the discount. Or anyone else in any product stream.
You are ignorant.

UGrev's picture

Leftist? is that how this lands? just because you don't agree, I'm INSTANTLY a lefty? for the record.. and you can look up my posts, I'm a libertarian. So you stick the attitude right up your ass. 

But you sound pretty young.. I refer to you the creation of anti-trust laws as factual causality. Would we need them if this never happened? 

Dr. No's picture

Your logic playes out when there is a monopoly situation.  With 8 competitors on the above list, do you really think your senario applies to this situation?  


ParkAveFlasher's picture

If your materials are supplied by a handful of price-gunners, if your assembly houses are staffed by union workers, and if your credit is priced in dollars, you can very easily have a price-controlling regime.  It is not a monopoly, it is a cartel, there is a difference.  A cartel is far more insidious.

Dr. No's picture

Cartels in the washer business..  who would have thought.  I say let pay higher prices so we can starve these cartels!!!

UGrev's picture

Never seen anything like that with local gas stations.. mmm..mmm..nope.. never.. 

UGrev's picture

It does on a regional basis.. and there are 7. Samsung is listed twice.

A Nanny Moose's picture

Monopoly can only be sustained through government protection. Anti-trust laws are anti-competetive and protect, rather than prevent with all force, the outcome is the exact opposite of the stated intent.

High prices result in other entrepeneurs entering the market, in order to get their slice of that profit. Monopolies are not a natural state of free markets. If prices are too high, consumers choose other other products/methods. Demand destruction.

A 30 year old video of Ron Paul discussing the topic.



UGrev's picture

Yes.. but they demand destruction AFTER the fact... so increases happen first and THEN the entities are broken. Ma Bell.

Dr. No's picture

Ma Bell? That was one company!!!! there are 7 on that list. Are you trying to protect Whirlpool or are you interested in a cheaper washer?  I think you are protectionist.  Once again, I think the washer business has enough compitiion so that there is no danger in monopolistic practices.  Ma Bell? Seriously?  This is the washer business.  Can we not have the option of buying cheaper washers??


EDIT:  Maybe I am missing the /SARC.  Sorry if I did.  My bad.

DFCtomm's picture

What good is a cheap washer if you have no money(job) to pay for it? Put it on the card? If you scoff at Ma Bell then what about the American electronics industry that was destroyed by Japanese dumping. True the companies won civil suits after years of litigation, but what good does a court victory do after you've already gone out of business? You international free traders never learn. It doesn't work because countries cheat.

UGrev's picture

I want inexpensive (not cheap) goods that are brought to the market in such a way as to not attempt to lie,cheat or steal the way to the top. In addition, I would like those goods not created in a country that unfairly competes with our labor here because they are willing or forced to live in slave like conditions. I have no problem with exceptionalism.. I do have a problem with excessively unfair advantages which will eventually hurt the labor force here. 

Everybodys All American's picture

Consumers may not be hurt buy the price of the washer but factor in the unemployment you pay for someone to sit idle and you will begin to understand the magnitude of the cost problem. Buy American and get Americans back to work..

catacl1sm's picture

less workers = more jobs available. I'm just sayin'.

Offthebeach's picture

Every single thing should be made in the county it is used in. This way there will always be unfathomable labor shortages. Every one will have a job, if not even three or more. Of course things will not be made, nor be
Anyway, you let some Washington hack decide what YOU can or cannot buy with your money, and find you a job slapping on a wiring harness on driers all day. I'll buy what I want, working for who I want.

Winston Churchill's picture

Curency wars>Trade wars>Shooting wars.

Do not pass go .

LawsofPhysics's picture

Correct, I'll only add that possession is the law as we are somewhere between the last two.

Dr. Engali's picture

"For the purposes of AD investigations, dumping occurs when a foreign company sells a product in the United States at less than fair value."

I thought that fair value was determined by an agreement between a willing buyer and a willing seller. What could I have been thinking?