Reporter's Notebook Is LG really dumping washers in US?

By Nam Hyun-woo, Lee Suh-yoon

Questions are rising over the legitimacy of the U.S. safeguard action on washing machines from Korean firms, as prices of those washers at popular U.S. distributors are at a similar level as products from U.S. appliance makers.

The U.S. announced a safeguard measure on washing machines from Korean firms LG and Samsung, Tuesday. Displaying his protectionist stance, U.S. President Donald Trump recently said Korean firms were “dumping washers into the United States” and Korea was destroying what was once a good job-producing business for his country.

The remark received angry responses from Korea’s home appliance makers.

“We have no reason to dump our products, because we make premium products,” said Song Dae-hyun, president of LG Electronics’ home appliance and air systems business during a press conference just after Trump’s remarks.

He said the debate over dumping seems to be taking place for political reasons and the company is preparing plans for any situation worth concern.

Dumping at same price?

According to the World Trade Organization, a product is dumped when it is “introduced into the commerce of another country at less than its normal value, or the export price is less than the comparable price.”

So, The Korea Times compared the prices of LG and Whirlpool washing machines on Best Buy, one of the largest U.S. consumer electronics stores. Whirlpool has been accusing Korean firms of unfair trading.

As of Jan. 19, Best Buy listed 34 LG washing machines and 21 Whirlpool washers. By washer capacity, number of cycles and other features -- which is information given for customers -- each company has three comparable models.

Whirlpool’s WFW75HEFW, which has a capacity of 4.5 cubic feet with eight washing cycles, was priced at $719.99, the same as LG’s WM3270CW, which has the same capacity with nine cycles. Factoring in discounts offered by Best Buy, the LG model was selling at $629.99 -- higher than that of the Whirlpool model’s $599.99.

Other comparable models, such as Whirlpool’s WFW90HEFC and LG’s WM3770HVA, were traded at the same price, or LG washers were slightly cheaper than those of Whirlpool.

In general, LG models were selling at higher prices, ranging from $539.99 to $1,799.99, than Whirlpool washers, ranging from $404.99 to $1,259.99. As Song said, LG was focusing on highly featured and expensive washers, while Whirlpool was concentrating on cost-efficient models. As a result, the average selling price of LG washers was typically much higher than those of Whirlpool’s.

Experts say this price comparison does not always tell whether LG is dumping its washers in the U.S. However, this weakens the arguments that LG is destroying U.S. businesses by selling its products below their normal value.

Who US government cares about?

Another question is who the U.S. government is trying to benefit through its safeguard measure.

Though many doubt the necessity of artificial intelligence or app controls for a washing machine, LG and Samsung washers are moving the industry forward anyway, with those technologies that “may have a chance to be helpful” for user convenience.

LG promotes that its smart care system remembers users’ favorite washing settings and automatically recommends them. Users can even download “custom-made” washing cycles from a database. Most of its washers allow app control.

These features may not directly clean people’s laundry better, but at least they can help them care less about laundry and more about something else. And industry trends are moving in this direction.

Seemingly, Whirlpool also wants to join the bandwagon. At this year’s Consumer Electronics Show, Whirlpool promoted its washers that show the washing status through a touchscreen or can be controlled by smartphone -- features which are no longer innovative for tech-savvy people.

Most features shown on Whirlpool’s website focus on conventional washing technologies such as adaptive wash technology, built-in water faucet or eco boost options. Only one Whirlpool model allows app control.

At best, Whirlpool seems to focus on washing itself. At worst, it is losing in the competition for new technologies.

By levying higher taxes on more competitive products, President Trump will be able to aid weak U.S. industries but only at the expense of U.S. end consumers. U.S. citizens would not want to protect their manufacturing at the cost of higher consumer prices and fewer choices after safeguard steps.

Businesses have deep pockets to support politicians but they have few votes at best. In comparison, ordinary people make less financial contributions to politicians but they are voters. And President Trump is three years away from his re-election if he can keep serving his remaining term.