Industry observers are particularly concerned about Trump’s campaign promise to impose a universal 10-20% tariff on all imports, which could affect the entire range of consumer electronics. (Image courtesy of Yonhap)
SEOUL, Dec. 10 (Korea Bizwire) – South Korean electronics manufacturers are closely monitoring potential trade policy shifts as President-elect Donald Trump continues to emphasize the importance of high tariffs on Korean-made washing machines.
Industry observers are particularly concerned about Trump’s campaign promise to impose a universal 10-20% tariff on all imports, which could affect the entire range of consumer electronics.
In a December 8 interview with NBC News, Trump touted the high tariffs imposed on imported washing machines from manufacturers like Samsung and LG as one of his accomplishments. The U.S. implemented safeguard measures in January 2018, imposing 20% tariffs on washing machine imports up to 1.2 million units and 50% on quantities exceeding that threshold.
While these safeguard measures expired in February 2023, the possibility of renewed high tariffs on Korean appliances looms with the prospect of a second Trump presidency.
Korean manufacturers have already adapted to protectionist pressures by expanding their U.S. production capabilities. Both Samsung and LG accelerated their factory construction plans in response to the 2018 safeguard measures, with Samsung launching production at its South Carolina facility in January 2018 and LG following suit at its Tennessee plant in December of the same year.
The companies are now exploring expansion of their U.S. manufacturing footprint beyond washers. LG Electronics is considering adding refrigerators and televisions to its Tennessee plant’s production line, which currently manufactures washers and dryers.
“We’re monitoring U.S. trade policies closely and preparing strategies for various scenarios,” said an industry official who spoke on condition of anonymity due to the sensitivity of the matter.
Despite concerns about potential tariffs, some industry observers suggest that Korean manufacturers’ competitive edge might cushion the impact. Samsung and LG currently hold the top two positions in both the U.S. home appliance and TV markets.
Ironically, the 2018 safeguard measures actually strengthened Korean companies’ market position. According to a U.S. International Trade Commission (USITC) analysis, Samsung and LG saw improvements in production volume, market share, total sales, employment, and wages from 2018 to 2022, while U.S. manufacturers like Whirlpool and GE experienced declines.
The Korean companies now alternate between first and second place in the U.S. washing machine market, ahead of domestic manufacturers Whirlpool and GE.
“The safeguard measures ultimately had limited impact on our industry,” another industry official said. “Through product competitiveness and innovation, Korean products have actually strengthened their leadership in the U.S. washing machine market.”
Kevin Lee (kevinlee@koreabizwire.com)
