Whirlpool wins ruling against foreign competitors
Samsung says decision could drive up consumer prices.
Whirlpool, WASHINGTON — operating the nation’s biggest washing machine factory in Northwest Ohio, won a trade panel ruling Thursday against competitorswho keep moving to new countries and plants in an alleged attempt to evade trade sanctions.
The preliminary victory is against Samsung and LG, Korean companies accused of serial country-hopping. Whirlpool says the companies have violated trade laws and undercut American workers repeatedly by under-pricing their residential washers, but that the companies keepmoving production to new countries to avoid nation-specific sanctions.
U.S. Sen. Sherrod Brown has referred to the practices of Samsung and LG as akin to the arcade game Whacka-Mole — and to the movie Groundhog Day. First they lost a trade case after being accused of unfairly undercutting Whirlpool and its 3,000 workers in Clyde, Ohio, by sellingwashing machines for American consumers at artificially lowprices after making their machines in South Korea and Mexico.
But rather than pay the penalties or stop their unfair practices, they moved to plants in China, Whirlpool and supporting lawmakers say. Thoselawmakersinclude Brown, a Democrat, and his Republican colleague, Sen. Rob Portman.
Then, when Whirlpool filed and won a complaint about thecompanies’ actions inChina, theymovedproduction again, this time to Vietnam and Thailand, Whirlpool said.
Ordered to pay trade-law penalties on China-made washing machines, Samsung might be moving production to other countries instead.
Trade penalties tend to be based on the countrywhere aproduct ismadeandacompany’s cost to make it there. By moving, the companies can stay a step ahead when nation-specific penalties are assessed and keep “cheating” theirway around trade laws and sanctions, Whirlpool says.
SamsungandLGhave consistently denied engaging in unfair trade practices. They have said the claims they sell at artificially low prices — a waytoincreasemarket share and harm competitors such as Whirlpool — are based on flawedanalyses of theirmanufacturing and other costs.
For example, it can be difficult for a company in the United States to determine actual costs for materials and industrial assemblies in non-market economies such as China, so complaints are based on extrapolations, the foreign companies say. And extrapolations canbewrong.