The U.S. Commerce Department has awarded LG Electronics has won a small tariff victory regarding duties applied to U.S. imports of large residential washing machines from South Korea. Tariffs were originally applied in 2013 at a rate of 13.0%, with the reduction having come as part of a quinquennial administrative review.

The cut could be largely a moot point, however, given the section 201 measures applied against all washing machine imports that were put in place in January 2018 as discussed in Panjiva research of Jan. 29.

Panjiva data shows that seaborne imports of residential washers fell 41.0% year over year in 2018 as a result of the new tariff package. Imports in January and February – when most shipments that are aimed at fulfilling the quota allowances will occur – were unchanged year over year.

Chart shows U.S. seaborne imports of washing machines.  Source: Panjiva

One impact on LG Electronics’ supply chain will be its decision as to whether to fulfill production requirements from South Korea now that duties are marginally lower. LG sourced 55.5% of its U.S. seaborne washing machine imports from South Korea in 2018.

It could choose to shift sourcing away from other locations including Thailand, which accounted for 13.9% of shipments, Vietnam (10.4%) or China (8.0%) where it had previously set up manufacturing capacity to offset earlier tariff decisions.

Chart segments U.S. seaborne imports of washing machines by LG Electronics by origin.  Source: Panjiva