• Investing
  • Stock
Round Table Thoughts
  • Economy
  • Editor’s Pick
Home Editor's Pick As Trump eyes more tariffs, South Korea remains safe haven for GM and Hyundai
Editor's Pick

As Trump eyes more tariffs, South Korea remains safe haven for GM and Hyundai

by February 14, 2025
by February 14, 2025 0 comment
Share
0
FacebookTwitterPinterestWhatsapp

DETROIT — As President Donald Trump threatens to further increase tariffs on U.S. trading partners, the greatest impact for the auto industry outside of North America would be additional levies on South Korea and Japan.

The East Asian countries produced a combined 16.8% of vehicles sold last year in the U.S., including a record 8.6% from South Korea and 8.2% from Japan, according to data provided to CNBC by GlobalData.

They were the largest vehicle importers to the U.S. outside of Mexico — and they have little to no duties compared with the 25% tariff Trump has threatened imposing on Canada and Mexico.

Automakers such as General Motors and South Korea-based Hyundai Motor export vehicles tariff-free from South Korea. The country overtook Japan and Canada last year to become the second-largest exporter of new cars to the U.S., based on sales.

It trails only Mexico, which represented 16.2% of U.S. auto sales in 2024, GlobalData reports.

“Obviously Hyundai has a massive amount of exposure. Behind it is GM … with relatively large volume models,” said Jeff Schuster, global vice president of automotive research at GlobalData. “There’s a lot of risk potentially here, but it’s limited, really limited, to those two players.”

Imports from Japan are currently subject to a 2.5% tariff for automakers such as Toyota Motor, Nissan Motor and Honda Motor. Vehicles from Japan represented about 1.31 million autos sold last year in the U.S.

Japan’s percentage of sales has actually decreased in recent years, while South Korea’s exports and sales have continued to rise from less than 845,000 in 2019 to more than 1.37 million in 2024.

South Korea has 0% tariffs on cars despite Trump renegotiating a trade deal with the country during his first term in 2018. That accord was touted for improving vehicle imports to South Korea, but it did little to address vehicle exports to the U.S.

The deal also has done little for increasing automotive exports to South Korea, according to data from the International Trade Commission. U.S. passenger vehicle exports to South Korea have actually decreased by roughly 16%.

Separate from cars, tariffs on trucks exported from South Korea and Japan to the U.S, as well as elsewhere, are 25%.

A tariff is a tax on imports, or foreign goods, brought into the United States. The companies importing the goods pay the tariffs, and some experts fear the companies would simply pass any additional costs on to consumers — raising the cost of vehicles and potentially reducing demand.

South Korea-based Hyundai is the largest exporter of vehicles to the U.S., followed by GM and then Kia Corp., a part of Hyundai that largely operates separately in the U.S.

GM has notably increased its imports from South Korea in recent years. Its U.S. sales of South Korean-produced vehicles — largely entry-level models — have risen from 173,000 in 2019 to more than 407,000 last year, according to GlobalData.

GM is the largest foreign direct investor in Korea’s manufacturing industry, according to the automaker’s website. It has invested 9 trillion South Korean won (roughly $6.2 billion) since establishing the operations in 2002.

GM produces its Buick Encore GX and Buick Envista crossovers, as well as the Chevrolet Trailblazer and Chevrolet Trax crossovers, at plants in South Korea. The company has touted the vehicles as being a pinnacle for the automaker’s profitable growth in lower-margin, entry-level vehicles.

“We’re taking out costs of programs, improving profitability and creating vehicles that customers love, like the new Chevy Trax and the Buick Envista,” GM President Mark Reuss said during the company’s investor day in October. “Trax and Envista have helped raise our share of the U.S. small SUV market to its highest level since 2007.”

Hyundai did not immediately respond when asked about potential tariffs on South Korea. GM and Kia declined to comment.

Terence Lau, dean of the College of Law at Syracuse University who previously worked as a trade expert for Ford Motor, said the automotive industry is built on free trade. If tariffs are implemented, the industry can adjust, but it takes time.

“The car industry can adjust to anything. Really, it can. It’s always going to make product that customers want to buy, because personal mobility and transportation is a human need all around the world,” he said. “What the car industry cannot do well is pivot on a dime.”

Lau argued that a single-digit tariff can be a “nuisance,” but once they hit 10% or more, that’s when additional costs can really began eating into the margin or products.

Ford Motor CEO Jim Farley last week argued that if Trump is going to implement tariffs affecting the automotive industry, it should take a “comprehensive” look at all countries to even the playing field in North America.

Farley singled out Toyota and Hyundai for importing hundreds of thousands of vehicles annually from Japan and South Korea, respectively.

“There are millions of vehicles coming into our country that are not being applied to these [incremental tariffs],” Farley said during the company’s fourth-quarter earnings call with investors. “So if we’re going to have a tariff policy … it better be comprehensive for our industry.

“We can’t just cherry-pick one place or the other because this is a bonanza for our import competitors.”

The White House did not respond for comment on potential tariffs on South Korea.

Trump on Thursday signed a presidential memorandum laying out his plan to impose “reciprocal tariffs” on foreign nations, but did not go into detail regarding what countries could be targeted.

As a presidential candidate, Trump floated the possibility of imposing across-the-board tariffs on all U.S. imports. But he also advocated for Congress to pass what he called the “Trump Reciprocal Trade Act,” which would empower him to slap tariffs on the goods of any country that has higher tariffs on U.S.-made goods.

— CNBC’s Kevin Breuninger contributed to this report.

This post appeared first on NBC NEWS
You Might Also Like
  • Delta sues CrowdStrike after widespread IT outage that caused thousands of cancellations
  • How a UAW strike could affect production of the popular Ford F-150 pickup truck
  • Bissell recalls 3.2 million handheld steam cleaners after scores of burn injury reports
  • ‘Pharmageddon’ could close pharmacies as protest spreads
Share
0
FacebookTwitterPinterestWhatsapp

previous post
Market Chaos: How to Spot Bottoming Stocks Before the Rebound
next post
Stash that Flash Right in the Trash

You may also like

Connecticut announces investigation into social media-linked thefts of Hyundai and...

June 22, 2023

What Fed chief Powell said about crypto that may have...

December 6, 2024

Americans are doing less ‘revenge spending,’ which is a good...

July 14, 2023

As Tesla layoffs continue, here are 600 jobs the company...

May 18, 2024

Bitcoin approaches new all-time high after surpassing $65,000

March 5, 2024

Doritos severs ties with transgender influencer in Spain following online...

March 8, 2024

Quectel launches pre-paid, flat-rate EU28 IoT connectivity packages

March 7, 2023

New Starbucks CEO Brian Niccol outlines priorities to end coffee...

September 10, 2024

Biden to launch task force to crack down on ‘unfair...

March 7, 2024

South Florida braces for Messi debut — and the possibility...

July 22, 2023

Connecticut announces investigation into social media-linked thefts of Hyundai and...

June 22, 2023

What Fed chief Powell said about crypto that may have...

December 6, 2024

Americans are doing less ‘revenge spending,’ which is a good...

July 14, 2023

As Tesla layoffs continue, here are 600 jobs the company...

May 18, 2024

Bitcoin approaches new all-time high after surpassing $65,000

March 5, 2024

Doritos severs ties with transgender influencer in Spain following online...

March 8, 2024

Quectel launches pre-paid, flat-rate EU28 IoT connectivity packages

March 7, 2023

New Starbucks CEO Brian Niccol outlines priorities to end coffee...

September 10, 2024

Biden to launch task force to crack down on ‘unfair...

March 7, 2024

South Florida braces for Messi debut — and the possibility...

July 22, 2023

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Peloton launching resale market for used bikes, treadmills

      June 4, 2025
    • Dollar General is shaking off tariff fears and winning over higher-income consumers

      June 4, 2025
    • S&P 500 Bullish Patterns: Are Higher Highs Ahead?

      June 3, 2025
    • McDonald’s Snack Wrap is officially returning. Here’s when.

      June 3, 2025
    • Tesla’s robotaxi launch in tech-friendly Austin has Musk playing catch-up in his hometown

      June 3, 2025

    Popular Posts

    • 1

      Trump-era China sanctions ended by Biden may be...

      June 27, 2024 2,777 views
    • 2

      Walz’s honeymoon with China gets fresh scrutiny as...

      August 9, 2024 2,482 views
    • 3

      Biden appointee played key role in recruiting Chinese...

      June 25, 2024 2,462 views
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful...

      July 10, 2024 2,443 views
    • 5

      Harris VP pick spent years promoting research facility...

      August 29, 2024 2,320 views

    Categories

    • Economy (7,009)
    • Editor's Pick (2,113)
    • Investing (538)
    • Stock (2,587)

    Popular Posts

    • 1

      Trump-era China sanctions ended by Biden may be revived under new House GOP bill

      June 27, 2024
    • 2

      Walz’s honeymoon with China gets fresh scrutiny as Harris camp blasts ‘lying’ critics

      August 9, 2024
    • 3

      Biden appointee played key role in recruiting Chinese businesses to Delaware: ‘Longtime friends’

      June 25, 2024
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful of Chinese spy threats

      July 10, 2024
    • 5

      Harris VP pick spent years promoting research facility that collaborated with ‘Chinese military company’

      August 29, 2024

    Latest News

    • Peloton launching resale market for used bikes, treadmills

      June 4, 2025
    • Dollar General is shaking off tariff fears and winning over...

      June 4, 2025
    • S&P 500 Bullish Patterns: Are Higher Highs Ahead?

      June 3, 2025

    Categories

    • Economy (7,009)
    • Editor's Pick (2,113)
    • Investing (538)
    • Stock (2,587)

    Disclaimer: RoundTableThoughts.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2024 RoundTableThoughts.com. All Rights Reserved.

    Round Table Thoughts
    • Investing
    • Stock
    Round Table Thoughts
    • Economy
    • Editor’s Pick

    Read alsox

    Delta CEO offers employees free flights...

    August 5, 2024

    Lordstown Motors files for bankruptcy, sues...

    June 29, 2023

    Autoworkers go on strike at plants...

    September 16, 2023
    Sign In

    Keep me signed in until I sign out

    Forgot your password?

    Password Recovery

    A new password will be emailed to you.

    Have received a new password? Login here