US starts safeguard probe into Samsung, LG washing machines from Vietnam

By Anh Minh   July 18, 2017 | 11:15 am GMT+7
US starts safeguard probe into Samsung, LG washing machines from Vietnam
Samsung washing machines in the U.S. Photo by Reuters

The Korean firms are accused of moving production from China to Vietnam in order to evade U.S. tariffs.

The U.S. has launched an investigation into washing machines produced in Vietnam by Korean appliance giants Samsung and LG to see if they are dumping their products on the U.S. market at unfairly low prices.

The probe was opened after U.S.-based Whirlpool Corporation filed a petition with the U.S. International Trade Commission (USITC), requesting an investigation into the alleged dumping.

According to Whirlpool, imports of made-in-Vietnam washing machines into the U.S. increased from 1.6 million to 3.21 million per year from 2012-2016, causing serious losses for manufacturers in the U.S.

It claimed that Samsung Electronics and LG Electronics have moved their production from China to Thailand and Vietnam to circumvent the tax that the U.S. imposes on made-in-China products, and were selling their washing machines in the U.S. at lower prices than American companies or below their production costs.

The import tax now stands at 1 percent for washing machines made in Vietnam and 2 percent for related components.

For products from China and South Korea, the tariffs are as high as 32–52.5 percent.

A representative of Samsung in Vietnam told VnExpress that consumers choose Samsung products because of their new designs and technical improvements.

If the U.S. decides to apply anti-dumping tariffs and self-defense measures on made-in-Vietnam products, it is the customers who will suffer the most as their choices will be limited and they will have to pay more for the products they want.

“It is unacceptable for Whirlpool to say their business has been hurt because of Samsung products,” the representative said.

In the first quarter this year, Samsung retained the No. 1 spot in the U.S. home appliance market for a fourth consecutive quarter, The Korea Herald cited a survey by market researcher TraQline as saying.

Samsung claimed 19.2 percent of the market from January-March, remaining the top supplier of major home appliances in the U.S.

The market share data was based on refrigerators, washing machines, ovens, microwaves and dishwashers, said the report.

After learning that its products will be investigated, LG said in an announcement that Whirlpool “is not capable of competing with other brands on the global market.”

The USITC will make its final conclusion in October and report to President Donald Trump before a final decision on whether to apply self-defense measure is made in December, Vietnam’s trade ministry said.