2 Responses to “A Few Final Words on Whirlpool-Maytag”

1. geoff manne Says:
   April 27th, 2006 at 4:24 pm

   Moss’ complaint is not a very strong one. For obvious reasons the agencies are not in a position to disclose proprietary firm information on efficiencies. Perhaps the statement could have included a few more platitudes, but hard evidence of the sort Moss seems to be seeking is not forthomcing (nor should it be). And although the AAI chooses not to believe it, much evidence on the strength of competitors is publicly-available. As for the agency’s own analysis, why isn’t this sufficient?:

   In laundry products, the Antitrust Division evaluated the merger from the standpoint of household automatic washers and dryers sold in the United States. Other manufacturers that currently sell laundry products in the United States include GE, Electrolux (under the Frigidaire brand), LG, Samsung, Fisher & Paykel, and Bosch-Siemens. Although some of these manufacturers have sold into the United States for years, LG and Samsung are more recent entrants. LG has grown to a significant volume of sales at Best Buy and The Home Depot in a short period of time, and Samsung very recently began selling its first laundry products in the U.S., selling at Lowe’s and Best Buy. Washer and dryer models are sold at a wide range of retail prices, based largely on the features and efficiency of the machines. The investigation revealed that a number of manufacturers, such as LG and Samsung, currently manufacture overseas high-efficiency, front-load washers and dryers and sell them successfully in the U.S. In the production of conventional top-load models, which are less efficient, there is untapped capacity at the manufacturing plants now operated by current U.S. suppliers, such as GE and Electrolux. In addition, companies such as LG currently manufacture top-load washers in Asia, and Samsung already manufactures top-load washers in Mexico for sale in Latin America. Thus, any attempt by the merged entity to raise prices in the sale of conventional top-load washers likely would be checked by the threat of additional U.S. production, the threat that top-load washers made in Mexico or overseas could be sold into the United States, and the loss of sales to suppliers of front-load washing machines. While front-load washing machines typically are sold at higher prices than conventional top-load machines, the total cost of purchasing and operating the two types of washers is comparable because front-load washers are more efficient.

2. David Fischer Says:
   April 27th, 2006 at 7:01 pm

   While I am generally in favor of transparency at all levels of government, I agree that Moss does not make a very strong argument. I should also add that there are stronger arguments against government approval of this merger; many of which are discussed by AAI on its site.

Leave a Reply

Name (required)

Mail (will not be published) (required)

Website