[Text/Observer Network Zhang Jiadong Edited by Gao Shen]

According to a report by the South China Morning Post on April 9, South Korea has recently announced emergency support measures for the automotive industry in an attempt to mitigate the impact of Trump's proposed tariffs on imported cars.

These measures include financial support for automakers, tax cuts, and subsidies to stimulate domestic demand. The South Korean government also pledged to make efforts to negotiate with the United States and help expand the market.

A Hyundai Motors dealership in Texas, Getty Images

The South Korean government stated in a statement: "Given that the proportion of locally produced vehicles by South Korean automakers in the U.S. is relatively low, our industry is at a disadvantage."

At the same time, the South Korean government said that it was expected that the tariff would cause "significant" damage to South Korean automakers and automotive parts manufacturers, but it was currently difficult to give specific numerical estimates.

The statement said that the government will increase policy financing support for automakers from the previously planned 13 trillion won to 15 trillion won.

At the same time, the domestic automobile acquisition tax will be reduced from the current 5% to 3.5%, until June 2025. In addition, South Korea will raise the electric vehicle subsidy from the current 20%-40% to 30%-80%, and extend the period by six months until the end of this year.

The South Korean government said it would actively support automakers in expanding export markets in the "Global South." The "Global South" refers to developing countries with growing demand, such as Africa, Latin America, and Asia.

Regarding the U.S. tariff, the South Korean government said: "We will make every effort through negotiations and strengthen bilateral cooperation to ensure that the United States does not treat South Korea unfavorably compared to other allies," but at present, the government has not revealed specific details.

The urgency of the South Korean government stems from the sharp rise in South Korean car exports to the U.S. in recent years.

Proportion of South Korean auto-related industries' exports to the U.S., Reuters

In 2024, South Korea's car exports to the U.S. amounted to $34.7 billion, accounting for 49% of its total car exports. At the same time, semiconductors, automobiles, and automotive components accounted for 42% of South Korea's total exports to the U.S. last year.

Following Trump's formal announcement of the car tariff last week, analysts believe that manufacturers are likely to bear part of the tariff costs in the first year, but will eventually change their production methods and may stop importing certain small-batch models to the U.S. market.

Hyundai Motor, South Korea's largest automaker, recently stated that it plans to maintain the stability of existing model prices within the next two months to alleviate customer concerns about the impact of tariffs on dealer sales.

Hyundai Motor Co-CEO Jose Munoz said that Hyundai Motor does not plan to raise prices in the U.S. market.

Analysts said that car tariffs will put upward pressure on overall car input costs. Trump may lean toward proposing aggressive tariffs to quickly gain advantages in negotiations.

This article is an exclusive article of Observer Network and cannot be reprinted without permission.

Source: https://www.toutiao.com/article/7491204307199574580/

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