### APPENDIX 13A. THE LOW-VOLUME MANUFACTURER

TABLE OF CONTENTS

13A.1 INTRODUCTION ................................................................................................ 13A-1 13A.2 SEGMENT REVENUES...................................................................................... 13A-1 13A.3 SHIPMENT VOLUMES ...................................................................................... 13A-4 13A.3.1 Shipments Assumptions........................................................................................ 13A-5

LIST OF TABLES

Table 13A.2.1 Reported LVM Revenue by Product Line ..................................................... 13A-1 Table 13A.2.2 LVM Revenues by Market Segment.............................................................. 13A-2 Table 13A.2.3 Stated LVM Revenue by Pr oduct and Market Segment ($MM) ................... 13A-2 Table 13A.2.4 Disaggregated LVM Washer Revenues ($MM)............................................ 13A-3 Table 13A.2.5 DOE Estimate of LVM Washer Revenue Percentages.................................. 13A-3 Table 13A.3.1 DOE Estimate of LVM Clothe s Washer Unit Shipments (2006).................. 13A-5

LIST OF FIGURES

Figure 13A.2.1 LVM Clothes Washer Revenue ($MM) by End-User and Drum Orientation in 2006 ................................................................................... 13A-4

13A-i

### APPENDIX 13A. THE LOW-VOLUME MANUFACTURER

13A.1 INTRODUCTION
The purpose of this appendix is to clarif y how DOE made its estimates regarding the shipment volumes and the importance of the comm ercial clothes washer business to the lowvolume manufacturer (LVM). To make its es timates, DOE relied on statements made by the LVM in its audited annual reports filed with the Securities and Exch ange Commission (SEC) which were supplemented with statements to DOE.

From 2002 to 2005, the annual reports broke ou t the approximate revenue that each LVM product line generated. In its annual reports, the LVM also stated th e revenues by end-user market segment, residential and commercial. The LVM recorded no residential revenues from 1999 to 2004 due to a non-compete agreement. In 2004, the non-compete agreement expired and residential sales recommenced.

13A.2 SEGMENT REVENUES

Table 13A.2.1 details DOE’s analysis of repor ted revenues for the LVM disaggregated by product type and market segment as a percentage of total revenue.

Table 13A.2.1 Reported LVM Revenue by Product Line Year Category 2002 2003 2004 2005 2006 Washer Extractors Top Load Washers Front Load Washers 26% 17% 5% 25% 17% 4% 24% 16% 5% 25% 14% 6% 24% 15% 6% All Washers

Tumbler Dryers Standard Dryers 48%

21% 11% 46%

22% 11% 45%

22% 11% 45%

23% 11% 45%

23% 11% All Dryers

Presses + Finishing Service Parts Value-Added Services Other-Sourced Product 32%

3% 14% 3% 0% 33%

3% 14% 2% 2% 33%

3% 14% 2% 3% 34%

2% 13% 3% 3% 34%

2% 13% 2% 4% Other 20% 21% 22% 21% 21%

Total 100% 100% 100% 100% 100%



### 13A-1

### The LVM also listed commercial, residential, and service parts revenue for every year 2002 to 2006, as shown in Table 13A.2.2. “Other” re venues refer to revenues from transactions due to an acquisition that the LVM completed in 2006.

Table 13A.2.2 LVM Revenues by Market Segment Year 2002 2003 2004 2005 2006 Residential Revenue Commercial Revenue Service Parts Other $0.0 $220.1 $35.5 $0.0 $0.0 $230.7 $36.9 $0.0 $3.6 $232.9 $38.2 $0.0 $8.5 $268.3 $40.5 $0.0 $14.4 $282.9 $45.7 $23.1 Annual Revenue $255.6 $267.6 $281.0 $317.3 $366.1

DOE subsequently overlaid the tables listi ng revenues by product category and revenue by market segment in order to disaggregate th e revenue by market segment and product line, shown below in Table 13A.2.3. The LVM subs equently reviewed a nd corrected the DOE estimates.

Table 13A.2.3 Stated LVM Revenue by Product and Market Segment ($MM) Year Category 2002 2003 2004 2005 2006 Residential Sales Revenue Top-Load Washers Front-Load Washers Standard Dryers $0.0 $0.0 $0.0 $0.0 $0.0 $0.0 $1.5 $0.8 $1.3 $4.4 $0.9 $3.2 $8.7 $0.6 $5.1 Sub-Total

Commercial Sales Revenue Top-Load Washers Front-Load Washers Standard Dryers $0.0

$43.3 $11.8 $29.3 $0.0

$45.8 $12.1 $31.1 $3.6

$42.9 $14.2 $29.3 $8.5

$41.5 $15.1 $30.3 $14.4

$42.8 $19.2 $30.7 Sub-Total

Attributable Service Parts Revenue $84.4
$12.1 $89.0
$12.6 $86.4
$12.5 $86.9
$12.6 $92.7
$14.5

Total Washer + Dryer Revenues $96.5 $101.6 $102.5 $108.0 $121.6

Total LVM Revenues Washer + Dryer + Parts Revenue % $255.6 37.8% $267.6 38.0% $281.0 36.5% $317.3 34.0% $366.1 33.2%



### Table 13A.2.3 illustrates how important the clot hes washer plus and dryer business is estimated to be for the LVM. The percentage of total revenue repres ented by the washer and dryer market has shrunk from 38% in 2002 but still represents about a third of its total revenues in 2006. Thus, this product category remains very important to the LVM. The balance of revenue comes primarily from high-capacity co mmercial laundry equipment. Standard dryer sales are usually bundled with clothes washer sales, hence their inclusion in the above analysis.

13A-2

### Besides providing revenue, the clothes washer and standard dryer sales give the LVM the scale to help in purchase parts, raw material s, and to help amortize equipment and tooling investments. If standard drye rs and their estimated parts reve nues were to be removed from Table 13A.2.1, the importance of the washer business remains evident in Table 13A.2.4.
Table 13A.2.4 Disaggregated LVM Washer Revenues ($MM) Year Category 2002 2003 2004 2005 2006 Residential Sales Top-Load Washers Front-Load Washers $0.0 $0.0 $0.0 $0.0 $1.5 $0.8 $4.4 $0.9 $8.7 $0.6 Sub-Total

Commercial Sales Top-Load Washers Front-Load Washers $0.0

$43.3 $11.8 $0.0

$45.8 $12.1 $2.3

$42.9 $14.2 $5.3

$41.5 $15.1 $9.3

$42.8 $19.2 Sub-Total

Attributable Service Parts Revenue $55.1
$7.9 $57.9
$8.2 $57.1
$8.3 $56.6
$8.2 $62.0
$9.7

Total Washer + Dryer Revenues $63.0 $66.1 $67.7 $70.1 $81.0

Total LVM Revenues Washer + Dryer + Parts Revenue % $255.6 24.6% $267.6 24.7% $281.0 24.1% $317.3 22.1% $366.1 22.1%



### While the revenues of the clothes washer busines s have been declining as a percentage of overall sales from over 25 percent in 2002 to le ss than 22 percent in 2006, the clothes washer business remains a substantial business unit for the LVM. Ta ble 13A.2.5 lists the relative importance of washer platforms and market segments to the LVM.

Table 13A.2.5 DOE Estimate of LVM Washer Revenue Percentages Year 2002 2003 2004 2005 2006 Revenue Percentage by Product Line Top Loader 77.3% 81.0% 76.2% 70.0% 65.2% Front Loader 22.7% 19.0% 23.8% 30.0% 34.8%

Revenue Percentage by Market Segment Residential 0.0% 0.0% 4.1% 10.2% 13.2% Commercial 100.0% 100.0% 95.9% 89.8% 86.8%

Although the revenues of front-loading clothe s washers have increased, top-loading commercial clothes washers continue to represent the majority of sales. Figure 13A.2.1 details the product and market segment data for the LVM in 2006.

13A-3Residential Parts Sales, $1.3, 2%Residential TopLoader, $8.7, 11% Commercial FrontLoader , $19.2, 24% Residential Front- Loader, $0.6, 1%
Commercial Parts Sales, $8.4, 10%

Commercial TopLoader, $42.8, 52%



### Figure 13A.2.1 LVM Clothes Washer Revenue ($ MM) by End-User and Drum Orientation in 2006

The potential impact of an energy efficiency standard that eliminates top-loading commercial clothes washers could thus be quite significant. Ju st the commercial top-loading business represents over 52 percent of total clothe s washer plus parts sale s and about 12 percent of total LVM revenues. Acc ounting for the bundled parts a nd dryer sales increases the importance of the commercial clothes washer sales further.

13A.3 SHIPMENT VOLUMES

While annual reports from subsequent years show significant growth in the residential market segment, commercial sales are still sign ificantly higher. Based on the pricing survey (Table 3.11.2 in chapter 3 of this TSD) and the published clothes washer markups (see chapter 6 of this TSD), DOE made the following shipments estimates for this manufacturer as of 2006.

13A-4

### Table 13A.3.1 DOE Estimate of LVM Cl othes Washer Unit Shipments (2006)

Market Segment Drum Axis Estimated 2005 Revenues

($MM) EndUser Clothes Washer

Cost* Total Clothes Washer Markup** Mfgr. Markup* * Shipment Volume by Sales Channel

Commercial TopLoading $42.8 / $824 X 1.93 / 1.23 = 81,502

FrontLoading $19.2 / $1,355 X 1.93 / 1.23 = 22,234

Residential TopLoading $8.7 / $697 X 1.93 / 1.23 = 19,586

FrontLoading $0.6 / $1,332 X 1.93 / 1.23 = 707 Total Mfg Volume (units) = 124,028 * See chapter 3 of the TSD ** See chapter 8 of the TSD



### 13A.3.1 Shipments Assumptions

• End-user prices depend on the pres ence of a coin box. Further,

– Commercial units require a coin box; and

– Residential units do no t require a coin box.

13A-5