Washing Machine Importers Spin Out on Tariffs

Washing Machine Importers Spin Out on Tariffs

Tariffs on imported washing machines have created a favorable pricing environment for US manufacturers

Trump Administration Imposes Tariffs – Imports Drop, Shipments Rise

In February 2018, the Trump administration implemented a 20% tariff on the first 1.2 million washing machine units imported, and a 50% tariff on subsequent imports. The value of imports of washing machines expanded 20% in 2017 as distributors stockpiled equipment in anticipation of implementation of the tariffs. The value of imports subsequently shrank 38% in 2018 (compared to 2017) as the tariffs took effect.

However, the tariffs proved to be a boon for US production in 2018, which led to a 19% spike in shipments as domestic manufacturers' product prices became more competitive, and as importer Samsung opened a washer manufacturing facility in South Carolina that year.

Price Rises

The imposition of tariffs on imported washing machines raised prices on both imported and domestically manufactured machines. Domestic manufacturers such as Whirlpool raised prices to take advantage of the decreased competitive position of imported washers. Overall, the tariffs on washing machines caused prices of imported washers and dryers to rise by about 12% as importers spread out the increased cost across both washers and dryers.

Foreign Manufacturers Open New Factories in the US

Samsung and LG Electronics constructed manufacturing facilities in the US in response to anti-dumping duties imposed at various points between 2011 and 2017 and the reduced logistical burden associated with manufacturing products close to the market of final sale. Samsung's factory began operation in January 2018 and LG's Tennessee factory began operation in May 2019.

Overall, the tariffs imposed in February 2018 handed domestic suppliers (most notably Whirlpool) an improved pricing environment, advantaging their operations at the expense of importers. However, the improved environment was offset to some extent by increased US steel prices due to tariffs placed on imported steel.

Want to Learn More?

We have you covered! For additional information and analysis of US industry trends, see Laundry Equipment: United States, a report published by the Freedonia Focus Reports division of The Freedonia Group. This report forecasts to 2023 US laundry equipment demand and shipments in nominal US dollars at the manufacturer level. Total demand is segmented by product in terms of:

  • washers
  • dryers
  • parts and accessories
  • dry cleaning machinery
  • other machinery, such as feeders, flatwork ironers, and presses

To illustrate historical trends, total demand, total shipments, the various segments, and trade are provided in annual series from 2008 to 2018.

The scope of this report includes both household and commercial (e.g., laundromat machines, uniform and linen laundry machinery) laundry equipment. Portable electric irons are not counted in demand and shipments figures. In addition, used/secondhand appliances are excluded from the scope of this report. Re-exports are excluded from demand and trade figures.

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About the Author

Owen Stuart is a Market Research Analyst with Freedonia Focus Reports. He conducts research and writes a variety of Focus Reports, and his experience as an analyst covers multiple industries.