US PRESIDENT Donald Trump said he will raise duties on South Korean imports – including cars – to 25 per cent, from a 15 per cent level brokered last year.
The announcement sees South Korea join a growing list of overseas markets targeted by the Trump administration’s tariffs, which analysts say is expected to hand Japanese importers a distinct advantage over Chinese and Korean competitors.
Increasing tariff’s on South Korean-made cars not only places OEMs including Hyundai and Kia at a disadvantage, but also General Motors, which builds models for the United States that include the Chevrolet Trax and Trailblazer in South Korea.
While Hyundai Motor Company produces some vehicles in Georgia (US), it still relies heavily on imported vehicles across the majority of its model lines.
President Trump defended the announcement on social media saying the Korean parliament had yet to approve the trade deal reached last July to lower duties to 15 per cent.
“Because the Korean Legislature hasn’t enacted our Historical Trade Agreement, which is their prerogative, I am hereby increasing South Korean tariffs on autos, lumber, pharma(ceuticals), and all other reciprocal tariffs from 15 to 25 per cent,” he wrote on Truth Social.
US automotive publication Automotive News says any increase on tariffs upon South Korea is a “headache” for export-dependent Hyundai Motor Group, which ships Hyundai, Kia, and Genesis vehicles to the United States from its South Korean plants.
The outlet says a 25 per cent tariff will place South Korean exports at a “significant disadvantage to Japanese competitors”, which face a lower 15 per cent rate.
South Korean government officials are said to be “scrambling” to implement a trade deal, with Yonhap News Agency reporting the delegates have been dispatched to Washington to discuss the matter.
“The Trump administration had sent a letter two weeks prior to Seoul petitioning the government to finalise implementation of the (15 per cent) accord,” it reported.
The latest trade stoush comes as President Trump threatens 100 per cent tariffs on Canada after Prime Minister Mark Carney signed a trade deal lowering Canada’s tariff on Chinese-made electric vehicles to 6.1 per cent, down from 106.1 per cent, in exchange for tariff reductions on Canadian agricultural produce, including lobster, crab, and canola.
Automotive News says President Trump has “walked back” a tariff threat made earlier this month against the European Union over opposition to his proposal for the US to acquire control over Greenland.