DRAFT - For Discussion Purposes Only 

Introduction 

Clothes Washer Manufacturers 

Interview Guide 

;!J4 PP 

The Department proposes to conduct interviews with manufacturer representatives to 

gather key information on the effects that potential new energy efficiency standards for 

clothes washers might have on their company's revenues and finances, and on their 

workforce. This interview guide provides a starting point to identify relevant issues and 

qualitatively and quantitatively describe the impacts of possible candidate standards 

levels. 

Part A: Current Organizational Characteristics 

The Department's interest concerning manufacturer impact is focused at the plant or 

profit center level directly pertinent to clothes washer production. The context within 

which the plant operates and the details of plant production and costs are not readily 

available from the published literature, however, so the Department invites the 

manufacturers to provide these details confidentially in their own words to the extent 

practical. The organizational setting around the clothes washer profit center is of 

interest to round out the Department's understanding of the probable future of the 

clothes washer manufacturing activity without and with energy efficiency standards. 

A.1 Identify names of parent companies and any subsidiaries relevant to the clothes 

washer industry. 

A.2 Please provide the locations of your clothes washer production facilities and the 

product mix manufactured there. 

A.2.1 How would energy efficiency standards affect each production facility 

mix? 

A.3 How has your company incorporated energy efficiency improvements in clothes 

washer technology into its product line and marketing strategy? 

A.3.1 Are horizontal-axis clothes washers currently being produced by your 

company? 

A.4 How would a new energy efficiency standard on clothes washers affect your 

product mix and marketing strategy? 
Part B: Industry Infrastructure 

As part of an attempt to better understand the industry infrastructure and the impact 

energy efficiency standards might have on it, the: Department would like for 

manufacturer representatives to discuss their major distribution channels and major 

sources of supply. 

Major Customer Types 

The following questions are intended to gain an understanding of how potential energy 

standards levels might affect customer mix and distribution channels. 

B.1. Generally how would a new clothes washer standard impact your customer mix, 

distribution channels and corresponding profit margins? 

B.2. Do you see any changes in emphasis on export sales, and would the presence of 

new energy efficiency standards have an impact on production of clothes washers 

for export sale? 

Major Suppliers 

The Department recognizes that manufacturers do not operate in insolation and that 

changes in production levels or economic health of a manufacturer can have significant 

impacts on its suppliers and other trade allies. The Department plans to be available to 

meet with representatives of these trade allies and to consider their impacts. 

B.3. Who are the suppliers that may be affected by changes in your product mix as a 

result of standards? How might they be affected? 

Part C: Manufacturer Cash Flow Analysis 

The Department wishes to discuss fully the results of the Industry Cash Flow with each 

manufacturer and identify manufacturer specific variances. Each manufacturer will have 

a version of GRIM that includes discrete manufacturer costs for all percentiles reported 

by AHAM. Each manufacturer can, if desired, input its own data and assumptions to 

develop its own expected cash flow. Alternatively manufacturers can select the 

percentile values that represent their costs at different efficiency levels. Arthur D. Little 

will discuss and report the variances in key variables and impacts for manufacturers that 

differ from industry averages. 

C.1. Costs 

How do you explain differences, if any, between your manufacturing costs with 

and without new energy efficiency standards and those presented in the sample 

results for the industry as a whole? 
C.1.1. Is the "Industry" cost structure (materials, labor, overhead, tooling, etc.) 

representative of your firm's costs? What are the differences and their 

causes? 

C.1.2. How might new standards alter this cost structure? 

C.2 Prices 

How do you explain differences, if any, between your expected product prices 

with and without new energy efficiency standards and those presented in the 

sample results for the industry as a whole? 

C.2.1. Are your gross margins (% revenue) different post standards? If so, what 

are the causes? 

C.3 Shipments 

How do you explain differences, if any, between your expected product shipments 

with and without new energy efficiency standards? 

C.3.1. What assumption(s) did you make about your firm's market share poststandards? What was your reasoning? 

C.3.2 Is your product mix significantly different from the overall industry 

proportions? 

C.4 Financial 

How do you explain differences, if any, between your financial data and those 

presented for the industry as a whole? 

C.5 Impacts on the Business 

Please discuss your interpretations of the cash flow analyses results for the 

standards cases. What do the results imply about the future of the business? 

Availability of capital? 

Are there additional financial impacts on new standards that are not being captured 

in the cash flow analysis? Please explain? (i.e., Tax Rate, Discount Rate, 

Working Capital, SG&A, R&D, Depreciation) 

C.6 Additional Economic Measures 

Please discuss any additional measures, if any, that you might have developed that 

provide insight into the economic effects of changes in energy-efficiency 

standards. 

Part D: Competitive Impacts Assessment 

Competitive impacts are assessed mainly in terms of market power, which is defined as 

the ability to set a given product price within a limited range. The Department is 

interested in manufacturer viewpoints on the extent to which new energy efficiency 

standards would increase market power and thereby lesson competition within the 

clothes washer industry. 
D. l. How would new energy efficiency standards affect your ability to compete in the 

marketplace? 

D.2. Do you believe that new energy efficiency standards would unfairly assist or harm 

the ability of some firms in the industry to compete? 

D.3. Please discuss examples, if any, wherein substantial consumer subgroups would 

experience economic or performance penalties as a result of new standards. 

D.4. Can your firm meet potential efficiency levels without changing your products in 

ways that consumers might care about? 

D.5. Does your company have specific information for the Department on consumer 

preferences for product attributes potentially affected by new standards? 

Part E: Employment Impacts Assessment 

The impact of new energy efficiency standards on employment is an important 

consideration in the rulemaking process. This section of the interview guide seeks to 

explore current trends in clothes washer production employment and solicit 

manufacturer views on how domestic employment patterns might be affected by new 

energy efficiency standards. 

E. l. How would your employment levels change under new energy efficiency 

standards? 

E.2. Would the workforce skills required under new energy efficiency standards be 

different enough to require extensive retraining or replacement of employees? 

Part F: Manufacturing Capacity Impacts Assessment 

The information discussed here is important for developing an understanding of the 

investment cost inputs to GRIM. 

F .1. How would the imposition of new energy efficiency standards affect your capacity 

utilization and manufacturing assets levels at your domestic production facilities? 

F.1.1 Would any facilities be closed or downsized? 

F.1.2. Would any facilities be added or upgraded? 

F .2. If current capacity were to be made obsolete, would it be remodeled to 

accommodate a new product mix? 

F.3. Please estimate the value of stranded assets resulting from a new standard, and/or 

the costs of refitting the facility and carrying out the research, engineering, and 

other supporting activities required to accommodate the new product mix.