US Threatens 25% Tariffs on South Korean Exports Amid Tense Trade Negotiations Targeting Automotive and Tech Sectors
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US Threatens 25% Tariffs on South Korean Exports Amid Tense Trade Negotiations Targeting Automotive and Tech Sectors
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The automotive sector is particularly vulnerable. Hyundai, Kia, and GM Korea—exporting a combined $34.7 billion in vehicles annually—face a serious margin crunch if the tariffs are enacted. As reported by AInvest, a scenario without a deal could prompt automakers to shift production from Korea to lower-tariff countries like Vietnam or Mexico, which would ripple through Korea’s supply chain and potentially cost GM Korea up to $2 billion in profits. The tech sector, notably Samsung and SK Hynix, is also watching closely as there is a risk that semiconductors could be hit by future Section 232 tariff investigations.
South Korean Trade Minister Yeo Han-koo has indicated progress in talks with U.S. officials, with hopes pinned on an "in-principle" agreement by the August 1 deadline. Seoul is attempting to fend off what it calls “unfair” tariffs by proposing increased access to its agricultural markets, though sensitive areas in agriculture and livestock may still be protected. According to Channel NewsAsia, South Korea’s top priority is to avoid tariffs that would undermine cooperation with its primary security ally and trading partner, and Minister Yeo suggests that some kind of framework deal is possible, even if the fine print will need further negotiation beyond the immediate deadline.
President Trump, meanwhile, has made clear that closing America’s trade deficit is his goal, telling reporters that South Korea “wants to make a deal right now” and highlighting long-standing U.S. grievances about trade imbalances. The Korea Herald notes South Korea’s $55.6 billion trade surplus with the U.S. in 2024, led by rising car exports—the very sector threatened most directly by the proposed tariffs.
Listeners, the clock is ticking. With just weeks to go, the outcome of these negotiations could reshape the future of South Korea’s industrial exports, investment flows, and its trade alliance with the U.S. Thank you for tuning in to the South Korea Tariff News and Tracker. Don’t forget to subscribe for the latest updates on this high-stakes trade standoff. This has been a quiet please production, for more check out quiet please dot ai.
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