FOR IMMEDIATE RELEASE
CONTACT: Kirsten Whitten, NCA Publicity, 781-524-1015
Nora Nealis, Executive Director NCA, 800-888-1622
NO MORE WIRE HANGERS?
WORLD ECONOMIC POLICIES IMPACT LOCAL SERVICES
Government Imposes Exorbitant Tariff on Chinese Imports of Wire Hangers
Cleaners Must Increase Pricing to Fund Higher Costs for this Business Essential
NEW YORK, NY (March 28, 2008) – As if it’s not bad enough that consumers are paying higher prices for gas, oil and dairy and bakery products, now consumers will have to pay higher prices at the dry cleaners as well. Already charged with skyrocketing oil, gas and transportation costs to run their facilities, drycleaners must now pay more for hangers – an essential business operating expense. The result will be yet another price increase for consumers to contend with as they try to budget during a recession.
How Did the Local Drycleaner Get Caught Up in World Economics?
On March 20, 2008, the Department of Commerce (DOC) ruled that steel wire hangers from the People’s Republic of China were being ‘dumped’ on the U.S. market, and in order to protect domestic production, imposed an exorbitant tariff – which has already doubled, and could eventually quadruple, the cleaners’ cost! Unfortunately, this move is coming a day late and a dollar short to protect most American manufacturers, since the untoward delay in imposing this tariff resulted in all but one US manufacturer closing their doors. Today, the Chinese hanger manufacturers account for the vast majority of the hangers sold in the U.S.
Already feeling the effects of the current economic downturn and the skyrocketing costs of utilities, cleaners nationwide are going to be forced to increase prices significantly (10% to 20%) and quickly just to cover their spiraling operating expenses.
So how did your local drycleaner end up as a pawn in international diplomacy and trade agreements? According to the National Cleaners Association (NCA), it began a number of years ago with a lawsuit filed by several domestic hanger manufacturing companies, claiming that China was dumping wire hangers on the U.S. market at below production cost pricing in an effort to drive the American manufacturers out of business. While the U.S. manufacturers technically ‘won’ their argument, a tariff was never imposed, the practice of dumping continued and another American manufacturing industry became virtually extinct.
David Takes On Goliath
On July 31, 2007, in a last ditch effort to save itself from the fate of their former American counterparts, the one remaining U.S. manufacturer – M&B Metal Products – filed a petition on the import of hangers from China with the DOC. On October 5, 2007, the United States International Trade Commission issued its affirmative preliminary determination and on March 20, 2008 made a determination that resulted in the immediate imposition of a tariff. It should be noted that the saga doesn’t end there, because there will be further case review and the tariff may wind up even higher than that which is currently set.
Within 24 hours of the announcement of the tariff decision, cleaners saw hanger prices jump 50-100% or more across the nation. According to Nora Nealis, Executive Director of the NCA, “while they are reluctant to do so, cleaners nationwide are working on such slim margins that they will have to increase prices to consumers if they want to stay in business. Our hope is that it ends here, but unfortunately the situation could get worse, before it gets worse and even more price hikes could be just around the corner. My suggestion to consumers is clean everything soon – don’t wait because none of us can predict what is going to happen next.”
Additional information on the DOC rulings can be found on the DOC International Trade Administration web site.
The National Cleaners Association (NCA) is the premier, professional dry cleaning trade association dedicated to the welfare of well-groomed consumers and the professional cleaners and suppliers who serve them. NCA has been the vanguard of education, research and information distribution in regards to garment and household fabric care since its inception in 1946. NCA provides members with: training and educational programs; marketing services and support; industry specific insurance programs; and advocacy and assistance on regulatory issues. NCA's long-term dedication to building relationships with garment designers, retailers and manufacturers demonstrates the organization's comprehensive commitment to quality service and customer satisfaction. For more information about our benefits and services, call 1-800-888-1622 or log onto our web site at www.nca-i.com.
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