Japanese competition xxxxxx-ing out US portable typewriter industry
The American-made, electric portable typewriter is being erased. A decade ago there were four domestic manufacturers: Royal, Remington, Underwood, and Smith-Corona. Now, only Smith-Corona is left - and the company claims it is the target of an overt ''dumping'' campaign by (surprise!) Japanese producers, aimed at driving it out of the typewriter business.Skip to next paragraph
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And, say experts, the whole affair raises troubling questions about the effectiveness of US antidumping laws.
''They're (Smith-Corona) in the right, but they're not getting the support of the administration on a flagrant abuse'' says Charles Nicolosi, an industry analyst at Dean Witter Reynolds, a brokerage house.
PETs (portable electric typewriters) have become a collegiate necessity, like day packs and down parkas. The American industry had a heritage to be proud of. The world's first practical typewriter was patented in 1868 by Christopher Sholes, of Milwaukee. In the 1950s, US innovation shrank fast electric machines to a size suitable for home use.
By 1960, Royal, Remington, and Underwood employed 15,000 workers in Northeastern manufacturing plants. Remington is no longer in the business; Royal , Underwood, and Olympia now put their nameplate on cheaper machines bought from Japanese makers - notably Brother Industries and Silver Seiko.
Of American producers, only Smith-Corona has survived. Leader in the field, inventor of the PET and the cartridge ribbon, the typewriter division prospered because of dedicated workers and modern technology. Ribbon cartridges, for instance, are welded by ultrasonic sound. The combination of the two produced prices even the Japanese couldn't match, company officials claim.
''I think it's no accident that they (Smith-Corona) have been the world's largest producer of portables for many years,'' agrees Roger Liddell, industry analyst at Tucker, Anthony & R. L. Day Inc., another brokerage. ''They've got production costs down to peanuts.''
Lately, that hasn't helped. SCM Corporation's typewriter division lost an estimated $8.8 million in its last fiscal year. ''Our expectation is now to be in the red for this year,'' a company spokesman admits.
On Dec. 14, 500 workers were laid off at Smith-Corona's New York State plants. An obligatory three-week leave was begun for 2,800 more.
Part of the problem is recession. Part is introduction of an electronic typewriter line that has consumed more time and money than was first envisioned. But both company officials and outside analysts say a major blow has been Japanese imports, sold at prices undercutting SCM's. Between 1976 and '78, Japan doubled the number of typewriters sent to the United States, to over 500,000. This year, if the present pace continues, they will sell almost 640,000.
SCM first complained about the Japanese back in 1974. It filed an antidumping suit with the US government, and the Treasury Department ruled that imports were indeed being sold at less than fair market value. But since the International Trade Commission ruled that Smith-Corona wasn't being injured by the practice, no dumping duties were assessed.
SCM tried a second time in 1979. The ITC ruled that SCM was injured. Victory? Not quite. Brother and Silver Seiko scrambled to have their prices reassessed, as was their right under US law. The Japanese submitted new information. The Department of Commerce decided the dumping margin had been cut substantially, from 48 percent below fair price to 4 percent for Brother, for example.
''We claim that's a lot of baloney,'' a spokesman for Smith-Corona says.
The other side is just as reserved.
''We think they're nuts,'' says an American executive of Brother International. ''Initially, there were dumping margins found. We have moved to correct them.''
Smith-Corona claims the Japanese have not raised prices, as promised; that the new figures were technical changes that don't really relate to market value; and that the reassessment was carried out behind closed doors.
Yet another dumping margin investigation is under way. Experts point out that the antidumping system's drawn-out nature means US companies can continue to be taken advantage of, while waiting for justice. ''How do you tell an empty factory that you've won?'' says Mr. Burns, somewhat morosely.
Peter Feller, an expert in international trade, speaking before a congressional committee made the analogy of a neighbor who vandalizes your home.
''It's fine for you to get an injunction keeping him from doing it again, but who's going to compensate you for the damages?'' Mr. Feller asks.
The survival of SCM Corporation is not at stake - its chemical and paper holdings, among others, continue to be promising. But its typewriter division could be closed, meaning many American term papers will be typed on Japanese machines.
''We're the last roadblock'' between the Japanese and domination of the world PET market, claims Burns.