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WHITE GOODS CONTINUE TO DEMONSTRATE THEIR ENERGY.

WASHINGTON-The major-appliance business could be at something of a turning point.

For the long term, there's accelerating change forced by competition and technology. The process likely will be enhanced by last month's energy-conservation deal.

It's the short term that's suddenly less clear. Manufacturers' domestic shipments have been rocketing, but April was the first month in two years to register a decline.

There were explanations. Core categories grew a bit. The record March ate into April. The holidays came late and the weather was bad. But there was another reading: For the first time in memory, some retailers reported softness.

The fact is the business has been very good indeed for most of the decade. Strong consumer confidence has made upscale segments grow even faster than the overall business.

One aspect guaranteed to become more important will be resource conservation. Manufacturers who once reacted to posted government regulations have adapted to proactive coordination with agencies and environmental groups.

That's how these parties agreed here to tighten standards in 2004 and 2007 on washers, label the units for the first time with their water consumption, create fresh Energy Star approval for efficient washers and refrigerators, and ask Congress for manufacturers' tax credits, which could reach $60 million per company.

Alan Kessler, Association of Home Appliance Manufacturers' chairman and Amana Appliances' vice president of government relations and technology, said government has acknowledged the cumulative burden of regulations. The deal's dual purpose is to achieve Department of Energy efficiency ratings and to qualify products for tax credits and Energy Star logos if they exceed the ratings by 10 to 15 percent.

Vendors agreed it's too early to predict the retail impact, but it's likely to be profound."There's no question that prices will go up," said Bracken Darrell, GE Appliances' product general manager for clothes care. "We're going to try to get some pricing [relief] for consumers."

That could come in two ways, the tax credits and utilities' support. Their rebates have reduced prices and increased sales in such campaigns as the Super Efficient Refrigerator Program, WashWise and TumbleWash.

"The difference it's going to make to consumers is really the value issue," said Kent Baker, Maytag Appliances' vice president of strategic marketing. The Neptune offered "enough to motivate them" to replace existing washers.

"Without question, conservation will become more important to consumers," declared Baker.
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Comment:WHITE GOODS CONTINUE TO DEMONSTRATE THEIR ENERGY.
Author:Beatty, Gerry
Publication:HFN The Weekly Newspaper for the Home Furnishing Network
Article Type:Brief Article
Geographic Code:1USA
Date:Jun 12, 2000
Words:390
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