South Korea implements emergency measures to support auto industry impacted by US tariffs.

From Yahoo Finance: 2025-04-08 19:12:00

South Korea implements emergency measures for auto sector in response to Trump’s 25% tariff on imported cars. Measures include financial support, tax cuts, and subsidies to boost domestic demand. Government plans to negotiate with U.S. and expand markets. Tariff expected to significantly impact South Korean automakers, causing liquidity issues.

To counteract damage from tariffs, South Korea will increase policy financing support for auto industry to $10.18 billion in 2025. Taxes on automobile purchases will be reduced to 3.5% until June 2025, and electric vehicle subsidies will be raised to 30%-80% of price discounts until the end of this year.

Government aims to support automakers in expanding export markets in developing countries. Industry welcomes support plan but seeks further discussions on additional tax benefits to boost domestic demand. South Korea’s auto exports to the U.S. totaled $34.7 billion in 2024, making up 49% of total auto exports.

Hyundai Motor plans to keep sticker prices steady for next two months to mitigate tariff impact. Program runs until June 2 following $21 billion U.S. investment announcement. Co-CEO confirms no price hikes planned for U.S. market. Analysts suggest tariffs could raise input costs, impacting electric vehicle supply chain more than combustion engine chain.



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