The U.S. International Trade Commission has ruled domestic washing machine manufacturers are being harmed by rising imports from South Korea, escalating a trade fight that may result in protectionist measures.
The ruling was a victory for Whirlpool, which had brought a “global safeguards” petition alleging South Korean manufacturers Samsung and LG Electronics are selling their washing machines in the U.S. at prices below the prices charged by American companies or below their cost of production.
The commission “determined that large residential washers are being imported into the United States in such increased quantities as to be a substantial cause of serious injury” to domestic manufacturers, the ITC said in a news release.
The next step in the process is for the commission to recommend remedies to President Donald Trump, who campaigned on stepping up trade protections for U.S. businesses.
The case “will pose a key test for President Trump’s willingness to impose the type of strict trade barriers he often touts as necessary to protect American businesses,” The New York Times said, noting that he has broad authority to impose trade barriers, including a sweeping tariff.
“This [decision] sets the stage for the administration to put in place an effective remedy to create a level playing field for American workers and manufacturers,” Jeff M. Fettig, the chairman of Whirlpool, said. “This type of corrective action will create U.S. manufacturing jobs.”
The South Korean companies contend this type of trade case will end up raising costs for American consumers and punish foreign companies who have devised technologically more advanced products. “In light of their apparent inability to compete with leading global brands like LG in the U.S. market, Whirlpool has decided to seek government restrictions to limit consumer choices,” LG has said.
Whirlpool has gone from having a 22.6% share in total dollar value of the American market for washing machines in mid-2008 to 17.4% in mid-2017. According to Forbes, it “missed the early end of [the] innovation evolution and is just now catching up to the sleek look Samsung and LG have been onto for years.”