July 30, 2012 / 5:58 PM / 6 years ago

UPDATE 3-U.S. sets duties on washers from Mexico, South Korea

WASHINGTON, July 30 (Reuters) - The U.S. Commerce Department on Monday set preliminary anti-dumping duties on about $1 billion worth of residential washing machines from Mexico and South Korea in a case brought by American manufacturer Whirlpool.

The department estimated Mexico manufacturers were selling the washers in the United States at prices 33.30 percent to 72.41 percent below fair value. It said South Korean producers were undercutting prices by 9.62 percent to 82.41 percent.

In an odd twist, one of the two Mexican manufacturers hit with the 72.41 percent preliminary duty was Whirlpool itself.

Whirlpool said in a statement it has stopped shipping washers from Mexico for sale in the United States and therefore would not face any duties.

The company said it has made significant investments at its Clyde, Ohio plant and expects nearly 100 percent of the washers its sells in the United States will be American-made by 2013.

“Whirlpool is committed to building products in the regions where they are sold and investing in our U.S. manufacturing presence. Our investments will continue as long as we can compete on a level playing field, with all of our foreign competitors playing by the established rules,” company spokeswoman Kristine Vernier said.

U.S. Democratic Senator Sherrod Brown hailed the decision, which he said would help restore a level playing field for the century-old American manufacturer.

“If we want to encourage companies like Whirlpool to continue moving jobs back to the U.S., then we also have to get tough on countries that don’t play by the rules,” Brown said.

Washers made by Electrolux and Samsung in Mexico were hit with a preliminary anti-dumping duties of 33.30 percent and 72.41 percent, respectively.

Washers made by Daewoo, LG Electronics and Samsung in South Korea received preliminary anti-dumping duties of 82.41 percent, 12.15 percent, and 9.62 percent, respectively.

Samsung and Electrolux said they disagreed with the decision and would continue to fight the duties.

In a similar case involving refrigerators from Mexico and South Korea, the U.S. International Trade Commission struck down duties imposed by the Commerce Department on the grounds that Whirlpool was not materially injured by the imports.

Caryn Klebba, a spokeswoman for Electrolux, said its share of the laundry machine market in the United States was only 5.6 percent compared to Whirlpool’s 56 percent, giving the company hope the ITC would rescue them again.

Samsung said it no longer makes washers in Mexico so it also would not be affected by those preliminary duties.

Importers have to post bonds or cash deposits based on the preliminary rates. In Daewoo’s case, the required cash deposit will be slightly less than the preliminary duty rate, the Commerce Department said.

The United States imported some $434 million of residential washers from Mexico and $568 million from South Korea in 2011.

The Commerce Department in May also set a preliminary “countervailing duty” of nearly 71 percent on washers made by Daewoo in South Korea to offset government subsidies.

LG and Samsung received duties of just 0.22 percent and 1.20 percent, respectively, in that phase of case.

A final decision on both types of duties is expected by the end of the year.

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