Antidumping committee loses 2, gains 1
By Powell Slaughter -- Furniture Today, September 15, 2003
High Point — Lexington Home Brands and Keller Mfg. have withdrawn from the coalition of U.S. manufacturers planning to file an antidumping petition targeting wood bedroom furniture from China, but contract specialist American of Martinsville has joined the group.
With the changes, the coalition says it still has 31 member companies representing more than 50% of U.S. wood bedroom furniture manufacturing capacity.
While coalition organizers are disappointed to lose any participants, the decision of Lexington — one of the group's most recognized names among consumers — and Keller doesn't alter the course of the antidumping effort, said John Bassett, president and chief executive officer of Vaughan-Bassett and a committee spokesman.
"We are excited to have American of Martinsville — the largest manufacturer in the United States of contract bedroom — join our coalition," he said.
Lexington withdrew its support after studying the petition's allegations and sizing up the likely outcome and potential effect of the action, said Bob Stec, chairman and CEO. Some of Lexington's strongest products are imports, but Stec said pressure from overseas sources played no role in the decision.
"This was really a matter of us gathering more information, sitting down in the quiet of the evening and saying what's best in the long term for our company," he said. "For every product, there's a best place to make it. For a Timberlake or mass-market collection, the United States is the place to be, but for some of the more labor-intensive products it's not."
Stec said he doesn't believe the petition effort will save U.S. jobs, given the extent of sourcing options beyond China, and thinks higher prices on certain goods, if duties are imposed, would hurt consumers.
Keller had joined the petition effort under prior management, and the company's decision to withdraw was one of the simpler decisions a new management team has made since taking over operation of the company in early August, said Keith Williams, president and chief executive officer.
"With the financial commitment involved we felt the risk wasn't worth the reward," he said. "We felt like it wasn't a good use of our time, particularly for me and (chief financial officer) Dave Richardson."
Keller's No. 1 focus is customers, followed by employees and cash flow, Williams said. "Our customers don't care about this, and our employees don't care," he said.
Keller's decision came from a new set of executives, but Lexington's represents an about-face by management.
When Lexington joined the petition, management enlisted the support of workers, setting up a process for employees to write letters to their congressperson and senators urging support of the antidumping effort. While Lexington has withdrawn from the petition process, Stec said the company isn't staking out a position for or against the proceedings.
"If there's an industry poll ... I would say we would be neutral," he said.
If the U.S. Department of Commerce ends up polling companies on their support for the antidumping action, a neutral management stance would let Lexington's workers lend their support to the petition if a majority vote in favor, according to DOC rules.
If management opposed the workers in such a case, rather than remaining neutral, the sides would cancel each other out and the company would be considered neither for nor against the petition in Commerce's eyes.
The petitioners themselves say Lexington's workers could put some pressure on management.
"We're confident that the local papers will communicate to the Lexington workers that they have a voice in this," said Doug Bassett, vice president of sales at Vaughan-Bassett. "Lexington management has put themselves in a very delicate situation. They closed a plant that will lay off around 400 American workers, and now they're pulling out of the coalition. And another committee member, Stanley, has a plant located in Lexington."
Meanwhile, he added, the Committee for Legal Trade continues to build financial support among suppliers to the U.S. furniture industry. To date, about 40% of the 354 supplier companies that attended a meeting in Greensboro, N.C., last month have contributed between $1,000 and $5,000 apiece to help fund the legal efforts for the petition. Another 20% have pledged donations.
"We expect eventually to have support from between 60% and 67% of the companies who came to the supplier meeting," Doug Bassett said.
He said the U.S. coalition remains on schedule to file its petition this fall, probably in October.
"The work that's being done right now is gathering the data from each of the companies in our coalition," he said. "There's an incredible amount of detail we have to provide King & Spalding (the law firm representing the petitioners) to support the claims of damage to the domestic industry."
