{"id":16187,"date":"2017-10-19T14:59:21","date_gmt":"2017-10-19T18:59:21","guid":{"rendered":"http:\/\/news.samsung.com\/us\/?p=16187"},"modified":"2023-12-18T12:52:26","modified_gmt":"2023-12-18T17:52:26","slug":"samsung-executives-testify-usitc-section-201-remedy-hearing-john-herrington","status":"publish","type":"post","link":"https:\/\/news.samsung.com\/us\/samsung-executives-testify-usitc-section-201-remedy-hearing-john-herrington\/","title":{"rendered":"Samsung Executives Testify at USITC Section 201 Remedy Hearing"},"content":{"rendered":"
Today, John Herrington, Senior Vice President and General Manager of Home Appliances for Samsung Electronics America, and Tony Fraley, Plant Manager for Samsung Electronics\u2019 South Carolina home appliance facility, testified in front of the U.S. International Trade Commission (USITC) in Washington D.C. on the commission\u2019s global safeguard (Section 201) investigation into imports of large residential washers. Below is the full text of their testimonies.<\/em><\/h6>\n
\n

Testimony of John Herrington,\u00a0<\/strong><\/span>Senior Vice President of Home Appliances at Samsung Electronics America<\/strong><\/span><\/h4>\n

Thank you for the opportunity to testify today. \u00a0I am John Herrington<\/a>, Senior Vice President of Home Appliances<\/a> at Samsung.\u00a0 I hope my testimony today will help you understand the dire impact of import restrictions on our new U.S. \u00a0facility, retailers and consumers.<\/p>\n

Whirlpool\u2019s petition welcomed Samsung to locate washer production in the U.S., saying it would be a clear win for the U.S. manufacturing sector, and would support the intent and purpose of the safeguard law.\u00a0 Well we are here, hard at work getting ready to manufacture washers in the United States.<\/p>\n

Samsung has been selling washers in the U.S. since 2006.\u00a0 It was only a matter of time before our success here justified our investment in a local appliance manufacturing facility. Our plans to establish this facility have been in the works for some time.\u00a0 As my colleague, Mr. Fraley has testified, we are making a huge investment in Newberry and hope that you can visit.<\/p>\n

\"Samsung\u2019s<\/a>

Samsung\u2019s South Carolina Home Appliance Manufacturing Facility, Aerial View<\/p><\/div>\n

Like Whirlpool, GE\/Haier, and LG, we\u2019re a global company. We all make washers and other appliances at factories around the world. It is typical to locally manufacture and import products to serve the needs of a market. GE\/Haier and Whirlpool both serve the U.S. market in this way.<\/p>\n

In 2010, Whirlpool was shifting its production of front-load washers from Germany to the U.S. It took Whirlpool several years to fully transition. While it was ramping up production, Whirlpool continued to import front-load washers from Germany. We need the same ability to import as we transition the majority of our production to the U.S.<\/p>\n

No one should doubt our commitment to creating jobs in the U.S.\u00a0 We have been marketing our products here for nearly 40 years and have more than 18,000 workers. We know what it means to be an American manufacturer, we are<\/em> an American manufacturer, and we are in it for the long run.<\/p>\n

As Mr. Fraley described, we are building a great factory in South Carolina<\/a>.\u00a0 I just visited earlier this month and can personally tell you it is going to be a state-of-the-art manufacturing facility, employing 1,000 people and eventually producing more than 1,000,000 washers a year. We will source parts and material in the U.S. and create the same kind of jobs that you heard about this morning from Whirlpool\u2019s suppliers.<\/p>\n

\"Manufacturing<\/a>

Manufacturing Floor, Foundation Pit Excavation (Photo #1)<\/p><\/div>\n

Commerce Secretary Ross was able to participate in the opening of the Newberry plant and noted that these were just the kind of jobs the Administration is trying to create in the U.S. We have also enjoyed the strong support of South Carolina Governor McMaster, who said our investment will usher in \u201can unprecedented period of economic growth and prosperity\u201d in the state.<\/p>\n

I\u2019m here today to ask you to support our South Carolina investment and not put the jobs we are creating in South Carolina at risk.<\/p>\n

We intend to supply the vast majority of our local market needs from our new South Carolina factory, but we can\u2019t supply all of those needs immediately in January. We will need to import washers so that we can supply a full range of products to our retailers and consumers during the ramp up period.<\/p>\n

If we are unable to offer our full range of products to retailers and consumers, we will lose floor space and sales, impacting the success of our South Carolina operation. So the ultimate impact of the proposed tariff is a lose-lose scenario for U.S. production, U.S. employment, and U.S. consumers.<\/p>\n

\"Manufacturing<\/a>

Manufacturing Floor, Foundation Pit Excavation (Photo #2)<\/p><\/div>\n

Blocking imports would give Whirlpool enormous market power and control. Prices would increase significantly and consumers would have less choice. Any tariff would halt the healthy growth we are seeing in the category. This would have serious consequences for retailers who are benefiting from an expanding market, and can also slow job creation at our South Carolina facility.<\/p>\n

The proposed tariff also dramatically impacts the success of FlexWash<\/a> \u2013 a unique product that represents a whole new category of washers. Since nothing like it is made in the U.S., FlexWash should be excluded from the remedy.<\/p>\n

It is the only washer on the market that combines two independent wash baskets, powered by two different motors. It can run two distinct wash loads at the same time, at different speeds, with different temperatures. There is no other washer in the market like this.<\/p>\n

For a variety of reasons, Samsung does not have immediate plans to produce FlexWash in the United States.\u00a0 If import restrictions are imposed, U.S. consumers would not have access to this new innovation. Retailers seeking to offer consumers new ways of washing their clothes will be unable to do so. And, again, our South Carolina facility would be impacted by our inability to offer the full line of Samsung products in the market.<\/p>\n

In closing, as a member of the domestic industry, we hope to be treated equally. Give us a chance to succeed as a U.S. manufacturer. We are here. We are part of the U.S. industry, so no remedy is necessary. But, if you must recommend a remedy, please recommend a fair TRQ that supports a reasonable transition to U.S. production. Thank you.\u00a0 I look forward to answer any questions you might have.<\/p>\n

\n

Testimony of Tony Fraley,\u00a0<\/strong><\/span>Plant Manager for Samsung Electronics’ South Carolina Home Appliance Facility<\/strong><\/span><\/h4>\n

Good afternoon, my name is Tony Fraley, I am the plant manager for Samsung\u2019s Newberry South Carolina appliance plant<\/a>. \u00a0I joined Samsung in August and I am very excited to be part of launching this new plant.<\/p>\n

I have dedicated my career to appliance manufacturing. Before joining Samsung I worked at Electrolux for 19 years, most recently as the Senior Director of Operations and Operational Excellence.\u00a0 I like making consumer products. I love seeing the product come off the line, knowing we created it, and ultimately thinking about the consumer who will buy it.<\/p>\n

Newberry is a great town. All the people I work with and that I’ve met and talked with in the community, are excited about Samsung\u2019s appliance facility.\u00a0 Everybody working to build the plant is excited to help Samsung. They want to help us be successful.\u00a0 Whether it is local hotels, restaurants, grocery stores, when you tell people you are working at Samsung, they smile.<\/p>\n

\"Manufacturing<\/a>

Manufacturing Equipment Delivery to Samsung\u2019s South Carolina Home Appliance Manufacturing Facility<\/p><\/div>\n

I joined in August, but Samsung has been planning for a US Appliance production facility for several years.\u00a0 That helped us get a running start once the location was finalized.\u00a0 We have done a tremendous amount in a few short months. \u00a0\u00a0Essentially, this old Caterpillar plant was an empty building with a slab of concrete when we started.\u00a0 By January, we plan to be up and running the first production line.<\/p>\n

I heard a lot this morning about this being a \u201cscrew driver operation\u201d or \u201ckit assembly\u201d plant — \u00a0I can assure you it is not.\u00a0 How do I know?\u00a0 I\u2019ve been in many washer factories in the United States and elsewhere, and I\u2019ve seen what goes into manufacturing washers.<\/p>\n

We are very proud of this facility and would welcome you or your staff to come see it in the next couple of weeks.\u00a0 Seeing is believing.<\/p>\n

Let me tell you a little bit about what we have done and what we will be doing in the coming weeks and months.<\/p>\n

Starting with an existing facility has certainly helped us to speed up our process.<\/p>\n

But, don\u2019t be fooled, we had to make significant investments to build out the facility for the kind of manufacturing we will be doing. \u00a0\u00a0We are reconfiguring to accommodate large injection molding equipment that will soon be installed.\u00a0 We plan to have several bays of injection molding machines producing key washer components, such as front & back tubs, outer tubs, top covers and other components.\u00a0 Another important early step was preparing the facility to handle the heavy duty metal stamping presses.\u00a0 We are installing presses to bend and form metal for the wrapper, cabinet, drum, front, back, top and other components.\u00a0 To make the building ready for those presses, we had to dig down more than 30 feet in some places to install the foundations for presses.\u00a0 If you\u2019d seen the facility last week you would have seen massive pits in the ground.<\/p>\n

But now, it\u2019s really starting to look like a factory.\u00a0 Production equipment is being delivered and installed as we speak, and we are recruiting and training new workers. \u00a0In addition to production associates, I am hiring tool and die makers, machine operators, technicians to program presses and robots, maintenance technicians and of course a salaried support workforce.<\/p>\n

One of the things I enjoy about manufacturing is working with\u00a0 and leading people.\u00a0 At Samsung, we invest in our people.\u00a0 We have a number of training initiatives underway.\u00a0 This includes sending people to Korea to be trained and bringing other experienced workers from across the company to train us in South Carolina.\u00a0 In addition, we are working with Ready SC and Piedmont Technical College for other core skills training.<\/p>\n

Soon we\u2019ll start testing equipment and building washers. We\u2019ll be assembling, disassembling and assembling washers over and over again.\u00a0 We have already hired hundreds of workers.\u00a0 We are on-boarding groups of workers every two weeks.<\/p>\n

In January we\u2019ll begin making parts for washers right there in Newberry.\u00a0 We will be converting steel into the \u00a0cabinet with the press lines of stamping equipment I mentioned. When you look inside the washing machine, you see a shiny drum inside. That starts as a piece of steel and we’ll produce that drum on site in Newberry as well.\u00a0 A lot of the other parts are injection molded, including the tub, which is why the injection molding equipment is important.<\/p>\n

\"Press<\/a>

Press Installation at Samsung\u2019s South Carolina Home Appliance Manufacturing Facility<\/p><\/div>\n

We\u2019ll be stamping and forming parts, injection molding parts and building subassemblies in Newberry. \u00a0\u00a0It will be really cool to watch resin pellets and \u00a0raw steel come together inside the factory to go out the back doors as one of our fantastic washing machines.\u00a0 I\u2019m looking forward to seeing the first production roll off the line in January.<\/p>\n

This facility is going to be state of the art.\u00a0 When all is said and done, we are investing more than $380 million.\u00a0 As I noted before, it will be the most efficient and modern washer factory that Samsung has anywhere in the world.\u00a0 When fully operational it will have two washer production lines, one for front load, and another for top load machines.<\/p>\n

Like Whirlpool, we will import some components, such as motors.\u00a0 A number of components will be imported initially but then shift to domestic supply, either in-house production or third party suppliers.\u00a0\u00a0 We are committed to developing a U.S. supply base. \u00a0At this time, we are actively qualifying U.S. suppliers to produce some components, including additional injection molding of smaller items.\u00a0 There are a lot of injection molded parts in a washer! Before a supplier can be brought on, we need to be sure that they can produce quality parts, that they can produce the required quantity, and that they can provide them on schedule. This is a time consuming and thorough process. Through this process, we expect to develop an ecosystem of suppliers in South Carolina and nationwide. In fact, we anticipate some suppliers may locate alongside our facility or nearby.<\/p>\n

\"Manufacturing<\/a>

Manufacturing Floor, Foundation Pit Excavation (Photo #3)<\/p><\/div>\n

This new supply base has a significant impact to the local community. Once we are fully up and operational, obviously there will be local employees that generate income and revenue associated with their activities, as well as a supplier base. There will be a significant multiplier effect to the city of Newberry as well as Newberry County, and ultimately, I think the state of South Carolina.<\/p>\n

We are working to launch this factory and create these jobs early next year.\u00a0 But, the ramp up will not be immediate.\u00a0 It can\u2019t be.\u00a0You can\u2019t just open up a factory at full capacity.\u00a0 <\/em>A huge facility like this needs to start up in an orderly and deliberate fashion.\u00a0 We plan on bringing one production line up at a time.\u00a0 We will need to gradually ramp up production.\u00a0 We will start each line with one model and build up to producing multiple models. We are invested in quality and safety and we are committed to doing this right.<\/p>\n

By the end of 2018, when both lines are running, we anticipate having almost 1000 employees, working two shifts.\u00a0 Until we get up and running, however, some washers will have to be produced abroad and imported to meet demand.\u00a0 \u00a0As our production takes off, the volume will shift to US production, but that will not happen immediately.<\/p>\n

In addition, while we are installing production equipment and committed to producing the major parts in-house, there will be a transition period during which importing parts will be necessary to the successful launch of this facility.<\/p>\n

If this Commission imposes import restrictions now, it could really cut us off at the knees, particularly the draconian tariff that Whirlpool is requesting.<\/p>\n

A tariff that cuts off Samsung\u2019s imports will undermine our competitive position in the marketplace, and will have a negative impact on our ramp-up and transition strategy for South Carolina.<\/p>\n

I\u2019m not a trade or marketing expert, I\u2019m a manufacturing expert, but the way I see it, all that these import restrictions will do is cause market disruption in the short term and give Whirlpool and GE\u00a0 a way to undermine my South Carolina facility. And, that is just taking jobs away from the workers we would have hired in South Carolina.<\/p>\n

I ask that you don\u2019t recommend import restrictions that jeopardize South Carolina jobs.\u00a0 Come and see this factory.\u00a0 Give us a chance to get up and running, and then let our US production compete on a level playing field with other US producers.\u00a0 Don\u2019t handicap us while our facility is getting off the ground.<\/p>\n","protected":false},"excerpt":{"rendered":"

Today, John Herrington, Senior Vice President and General Manager of Home Appliances for Samsung Electronics America, and Tony Fraley, Plant Manager for Samsung Electronics\u2019 South Carolina home appliance facility, testified in front of the U.S. International Trade Commission (USITC) in Washington D.C. on the commission\u2019s global safeguard (Section 201) investigation into imports of large residential […]<\/p>\n","protected":false},"author":84,"featured_media":15058,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[17446],"tags":[5839,49,8344,483,5854,9111,510],"blue-badge":[],"class_list":["post-16187","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-official-statements","tag-flexwash","tag-home-appliances","tag-international-trade-commission-itc","tag-john-herrington","tag-manufacturing-plant","tag-newberry-county-facility","tag-washerdryer"],"acf":{"turn_off_retargeting":true},"fimg_mobile_url":"https:\/\/img.us.news.samsung.com\/us\/wp-content\/uploads\/2017\/08\/14151232\/samsung-logo.png","fimg_url":"https:\/\/img.us.news.samsung.com\/us\/wp-content\/uploads\/2017\/08\/14151232\/samsung-logo.png","primary_category":{"term_id":17446,"name":"Official Statements","slug":"official-statements","term_group":0,"term_taxonomy_id":17446,"taxonomy":"category","description":"","parent":0,"count":40,"filter":"raw","term_link":"https:\/\/news.samsung.com\/us\/category\/official-statements\/","term_path":"official-statements"},"badge":false,"_links":{"self":[{"href":"https:\/\/news.samsung.com\/us\/wp-json\/wp\/v2\/posts\/16187","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/news.samsung.com\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/news.samsung.com\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/news.samsung.com\/us\/wp-json\/wp\/v2\/users\/84"}],"replies":[{"embeddable":true,"href":"https:\/\/news.samsung.com\/us\/wp-json\/wp\/v2\/comments?post=16187"}],"version-history":[{"count":0,"href":"https:\/\/news.samsung.com\/us\/wp-json\/wp\/v2\/posts\/16187\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/news.samsung.com\/us\/wp-json\/wp\/v2\/media\/15058"}],"wp:attachment":[{"href":"https:\/\/news.samsung.com\/us\/wp-json\/wp\/v2\/media?parent=16187"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/news.samsung.com\/us\/wp-json\/wp\/v2\/categories?post=16187"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/news.samsung.com\/us\/wp-json\/wp\/v2\/tags?post=16187"},{"taxonomy":"blue-badge","embeddable":true,"href":"https:\/\/news.samsung.com\/us\/wp-json\/wp\/v2\/blue-badge?post=16187"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}