Japan Ruled to Be ‘Dumping’ Cellular Phones : Commerce Dept. Backs Motorola Complaint

Japanese electronics firms, which account for more than half of the U.S. market for cellular mobile telephones, have been “dumping” surplus phones and phone parts in the United States for as little as half of their price in Japanese markets, the Commerce Department ruled Friday.

The issue now goes to the U.S. International Trade Commission, which will decide whether American cellular phone makers have been injured by the cut-rate sales and whether tariffs or other steps are needed to remedy the damage.

The Commerce Department decision upholds an unfair competition charge by Schaumburg, Ill.-based Motorola, the leading U.S. maker of the new car telephones and a frequent critic of Japanese trade policies in telecommunications.

$150 Million in Imports

The department required Japanese firms to post cash or bonds roughly equaling the differences between their discount U.S. sales and their Japanese value until the extent of injury is determined.

Last year, cellular phone imports totaled $150 million, the department said. Analysts say that more than 200,000 of the popular phones are in use in the United States. Some say that the market for the devices will run into the billions of dollars by the 1990s.

Los Angeles is one of the major American markets for the devices.

Suggested retail prices on Motorola’s cellular phones range from $1,500 to $4,000. Some manufacturers in the highly competitive market have lowered prices on some models to less than $1,000.

The Commerce Department said that Matsushita Communication Industrial Co. sold its cellular phones in the American market at a dumping margin of 107%, meaning that the phones sold in Japan for roughly twice their U.S. cost.

Phones of Japan’s NEC Corp. sold at a margin of 95% and Mitsubishi Electric phones at an 89% margin.

Margins for other Japanese firms ranged from 58% to 3%. One firm, Toshiba, was found not guilty of the dumping charge.