Tariffs are meant to punish, and protect. Who comes out as a winner or loser from the U.S. decision to slap duties on solar panels and washing machines isn’t straightforward.
While the obvious winners are American manufacturers that will likely become more competitive, foreign companies that have built a local presence could also gain an edge. On the losing side, overseas appliance producers will hurt, but tariff levels for some solar panel makers based outside the U.S. may not be as steep as they had expected.
- Whirlpool Corp.: This is the company that started the washing machine fuss by filing a petition in 2011 and has been seeking relief ever since. The Benton Harbor, Michigan-based company is now best poised to gain share—it already has about 43 percent of the market for washing machines in the U.S.
- Qingdao Haier Co.: The Chinese company finds itself in a favorable spot mainly thanks to its $5.6 billion purchase of the home appliance business of General Electric Co. in 2016. Haier now has the option to ramp up production at the Louisville, Kentucky-based facility, skirting President Donald Trump’s tariff.
- First Solar Inc.: This Tempe, Arizona-based company stands to gain as costs for competing, foreign panels rise. And the kind of thin-film panels it produces may be exempt from the tariffs approved Monday.
- SolarWorld Americas and Suniva Inc.: The two solar manufacturers that pushed the Trump administration for tariffs clearly stand to gain as the step boost the value of the companies—and aid their debtors—as they explore potential sales.
- U.S.-China trade relations: Perversely, the tariffs may prove to be a step toward resolving a much larger solar trade dispute with China that dates back to at least 2012. Trump said in his statement that the U.S. Trade Representative will hold discussions that could lead to a “positive resolution” to the solar trade measures that were previously imposed on Chinese solar products and U.S. polysilicon.
- Longi Green Energy Technology Co.: Location, location, location. If this Chinese solar manufacturer follows through with it plans of producing cells and modules in the U.S., then it could remain in the game and gain an edge over its peers.
- India: China’s biggest solar customer could gain by deciding not to impose its own tariffs and take advantage of possible lower prices as suppliers seek new markets, according to energy research and consultant Wood Mackenzie Ltd.
And the losers:
- American workers: Jobs will be at risk—in both industries. The Solar Energy Industries Association projected 23,000 job losses this year in a sector that employed 260,000 and warned the tariffs will delay or kill billions of dollars of solar investments.
U.S. state officials where Samsung Electronics Co. and LG Electronics Inc. have built plants, including South Carolina governor Henry McMaster, warned last year that the levy could hurt workers and economic growth. LG said in a statement the result hinders the ramp-up of its new plant in the country and threatens new jobs.
- LG.: This company and Samsung were painted as the chief perpetrators in Whirlpool’s complaint. Analysts say LG will see the bigger hit, as Samsung may be better able to cushion the blow through its other high-tech businesses. LG could see an impact of 2 percent to 3 percent on its earnings from the tariff, according to Dohoon Lee, Seoul-based analyst at CIMB Securities.
- Electrolux AB: The Swedish company faces tariffs of more than 70 percent on its washing machines which are produced in Mexico and imported into the U.S., and the latest levy will add more pressure, according to Hye Min Song, industry manager of consumer appliances at Euromonitor International.
- Midea Group Co.: The Chinese appliance maker also supplies components to other brands, but the price advantage it currently enjoys in production could erode with the levy. Customers may start to move more of their sourcing from Asia Pacific to the U.S., according to Euromonitor’s Hye.
- JinkoSolar Holding Co.: The world’s largest publicly traded solar manufacturer said the duties were “better than expected,” but that doesn’t mean they won’t hurt. The Chinese giant may consider exporting more solar panels to the U.S. from outside China as a way to pay lower tariffs, said Sebastian Liu, investor relations director at JinkoSolar.
- The biggest Chinese-owned producers including Trina Solar Ltd., Canadian Solar Inc. and JA Solar Holdings Co. will all feel the effect of the tariffs in the short term at least, according to Robin Xiao, an analyst at CMB International Securities. Beyond that, he’s expecting continued growth in downstream solar demand as cost reduction methods offset the increased tariffs.
- Asian countries accounted for more than 90 percent of the $3.7 billion in U.S. solar module imports in the first 10 months of last year, according to Bloomberg New Energy Finance. Every nation will be impacted by the new levies, though they’re in-line with expectations, said Liu Yiyang, deputy secretary-general of China Photovoltaic Industry Association.
