The economic disaster caused by Brexit, the very harsh price competition conducted in Europe and especially in the United Kingdom by Asian competitors, the dramatic consumer crisis, the replacement of the first commission of the English CMA, a direct emanation of the British government extremely opposed to Whirlpool-Arcelik joint venture, with an independent one, and the pressures of English retail... All this explains the unexpected and surprising acceleration of the English Authority's definitive authorization for the Turkish-American joint venture which, as the CMA had officially declared, was supposed to arrive no earlier than the 26th March.
Whirlpool-Arcelik: “No damage to competition from the joint”
“We conducted a thorough investigation into this agreement, which included extensive engagement with customers, competitors and others. We have found that the agreement is not expected to harm competition,” he states bluntly Martin Coleman, president of the independent expert group that conducted the survey – as buyers will continue to benefit from a wide range of options. Therefore, we believe this agreement should be allowed to proceed."
But it is also surprising that in February the new commission was quick to respond with an unofficial approval of the joint to the very harsh criticism from the press, business and politicians regarding the many months of delay in the English response to the integration and relaunch activities of the new company . However, even more surprising is that the motivation for what appears to be a criticism of the start of the investigation is based precisely on the data and arguments with which the Beko-Arcelik representatives had constructed the response. Which, it should not be forgotten, came in response to the request of the first commission which asked without any justification to provide for possible reductions in the presence of certain brands or product types on the English market.
Whirlpool-Arcelik: what the press release says
“The panel reviewed evidence showing that although Arcelik e Whirlpool both hold a strong market position – states the press release – they will continue to face significant competition from other suppliers. This includes well-known suppliers and brands such as Bsh (including the Bosch and Neff brands), Haier Group (including the Hoover and Candy brands), Samsung and LG; “private label” brands from retailers such as Logik and Bush (Currys-for sale- and Argos); and newer competitors like Hisense. The data also demonstrated that the competitive landscape has changed considerably in recent years and continues to change. Whirlpool's market position in the MDA sector has declined significantly over the past decade and it is likely that its MDA operations in Europe will be substantially different in the future. At the same time, vendors such as Haier Group and Hisense have gained market share and are likely to continue expanding. These market dynamics are supported by a range of evidence, including internal documents, financial analysis and third parties.” “Were we wrong? Well yes". The summary of the CMA's positions is this. But after seven months of waiting, far too many.
Arcelik satisfied with the agreement
Arcelik's official reaction is, although very soft, positive. “Arçelik obviously welcomes the decision of the UK Competition and Markets Authority to approve the proposed transaction with Whirlpool. This transaction represents a significant milestone for our global growth strategy and our vision of establishing a sustainable lifestyle in every home in Europe. With the creation of Beko Europe we will have the opportunity to revitalize Europe's position in the household appliances sector, the opportunity to create a more competitive and more sustainable future. We will work tirelessly to ensure consumers have better access to a wider range of products and solutions lifestyle high quality, innovative, energy efficient and reliable. We now expect our two companies to start operating under the same roof in early April 2024. Beko Europe Bv of which Whirlpool will hold approximately 25% and Arcelik a 75% ownership stake, is expected to have more than 20.000 employees, 14.000 by Whirlpool, 6.000 by Arçelik and a production capacity of approximately 24 million household appliances per year”. We will know more after the closing of the first quarter of the two companies at the end of March and an initial assessment of sales of large and small household appliances in Europe. The official announcement on Beko Europe's new strategies will be on 1 April.
Whirlpool, Paolo Lioy speaks
And Whirlpool? Back to Eurocucina he declares Paul Lioy. But we will not fail to underline that the changes we are talking about are many and even if the crisis bites European markets and families, something positive is happening. Whirlpool Europe, for example, returns to highly respectable visibility, that is, at the next Eurocucina, the most important event worldwide for the sector, after having had to abandon the previous edition.
“We are thrilled to return to Eurocucina – declares a FIRST online Lioy, CEO of Whirlpool Italia & Iberia, VP Whirlpool EMEA and president of Applia Italia (Confindustria) – a renowned international stage where the excellence of kitchen design and innovation can be showcased, and which finds its highest expressions in Made in Italy. Our presence underlines our concrete commitment and closeness to the sector, with cutting-edge solutions designed to address the evolving needs of consumers. With our return we want to consolidate the position of our Whirlpool, Hotpoint and Indesit brands among the sector leaders in Italy and Europe and underline the solid and long-lasting relationship with Italian kitchen manufacturers known throughout the world. Inside our stand we will talk about the 'purpose' of our brands and our commitment to circular economy practices underlying a commitment towards sustainability made by the company over 50 years ago and which in these days is enriched with a new project, the EcoPlayer platform, created to help consumers make daily choices for the environment more easily. Above all, we will present the most important projects coming to the market in 2025 with relevant innovations in all categories. Our focus will be on the technological evolution of the new one cooking suite of the medium-high range brands that not only interprets the latest trends in kitchen design, but also brings the user experience to a new level in the compact size thanks to a new product architecture. In the production of our products we have distinguished ourselves in recent years for our ability to innovate the offer, expanding it with new modularities that are increasingly relevant in the design of spaces, especially in homes in highly urbanized cities".
