By Lesley Wroughton
WASHINGTON (Reuters) - Appliance giant Whirlpool Corp (N:WHR) on Thursday called on the U.S. International Trade Commission to impose "global safeguard" restrictions on imported washing machines to stop its South Korean rivals Samsung and LG from flooding the American market with cheap machines.
In testimony to the trade body, Whirlpool Chief Executive Officer Jeff Fettig accused Samsung Electronics (LON:0593xq) Co Ltd (KS:005930) and LG Electronics Inc (KS:066570) of pursuing a strategy of moving operations around the world to avoid paying U.S. duties.
"Without safeguard relief, it is hard to see how we maintain our competitiveness in the face of a continued onslaught of low-priced imports," Fettig said.
He said the companies had moved major manufacturing operations to five different countries to avoid anti-dumping duties being imposed by the United States on their washing machines.
"A global safeguard is absolutely critical because it is the only tool available under U.S. trade law that can remedy the impact of Samsung and LG’s evasive 'country hopping' behaviour," he added.
The ITC in January found that Whirlpool and other U.S. producers were injured by dumped imports of large residential washing machines from China. The 6-0 decision locked in place for five years final duties on the products of as much as 52.5 percent.
Appealing to President Donald Trump's "America First" agenda, Fettig warned that American jobs were at stake unless action was taken to halt the low-cost imports.
While Whirlpool has been pursuing anti-dumping cases for years against its South Korean rivals, it did not seek broader relief under Section 201 of the Trade Act of 1974 until Trump's commerce secretary, Wilbur Ross, took office with a mandate for a much tougher trade enforcement agenda.
Two U.S. solar panel makers, SolarWorld America (F:SWVKk) and Suniva Inc, majority-owned by Chinese solar manufacturer Shunfeng International Clean Energy Ltd (HK:1165), are seeking similar relief from imports in the first Section 201 case filed in more than a decade.
CONSUMER BRAND APPEAL
Samsung Electronics North America's chief executive, Tim Baxter, rejected Whirlpool claims that the company's washers were harming the U.S. appliance industry.
"Our success in the U.S. laundry market is due to our ability to meet new consumer preferences," Baxter said in prepared testimony for the hearing. "American consumers buy Samsung washing machines because of our design, quality workmanship and innovation."
Samsung said in June it would invest $380 million in a home appliance manufacturing plant in Newberry, South Carolina, which would generate 954 jobs by 2020.
John Riddle, senior vice president of U.S. Home Appliances at LG, argued that LG's growth in the U.S. market was because consumers were supporting its brand and that new retailers had decided to carry its products.
The ITC will vote later this month on whether the washer imports cause harm to U.S. producers. If it makes such a finding, would recommend remedies by late November to Trump, who would make a final decision by early 2018.