South Korean media: Samsung and LG hit hard by global tariffs in the U.S.! On April 7, Energy Economics, a South Korean media outlet, published an article stating that with the drastic changes in U.S. trade policies, South Korean companies are expected to suffer damage. With high tariffs being levied on products produced in third countries such as Vietnam and India, the landscape of the global supply chain is changing. Representative export companies like Samsung Electronics and LG Electronics are expected to be immediately affected. This measure is not just a problem for South Korea. Its impact is likely to spread throughout American enterprises and the entire global industrial ecosystem, triggering America's own "supply chain risks." On February 2, U.S. President Donald Trump announced high tariffs of 46% on products imported from Vietnam and 26% on those from India. The measure will take effect on the 9th and is expected to have a broad impact on global companies with production bases in this region. Since the end of last year, the Office of the United States Trade Representative (USTR) and the Department of Commerce have comprehensively reviewed measures to strengthen origin rules and impose high tariffs on products made in third countries, citing the protection of domestic industries and containment of China. This policy appears to target China, but in reality, companies from South Korea, Japan, and other nations that have diversified their production bases to places like Vietnam and India, which heavily rely on Chinese components, are likely to be directly impacted. Samsung Electronics operates large production facilities in Bac Ninh Province and Thai Nguyen Province in Vietnam, where approximately 45% of its smartphones are manufactured. Many products shipped to the U.S. market are assembled in these regions. Therefore, the tariff increase may lead to an immediate rise in product prices or a decline in profitability. LG Electronics also has production facilities in Hai Phong, Vietnam, producing major home appliances such as refrigerators, washing machines, and televisions. This move may cause LG Electronics' home appliances produced in Vietnam to lose price competitiveness in the U.S. market. Another issue brought about by this strengthened tariff measure is that the losses are not limited to South Korean companies. Even domestic companies like Apple and Tesla, which produce some products in the U.S., source critical components such as camera modules, batteries, and circuit boards from China or Southeast Asia. For American enterprises, even if they are integrated into the global supply chain, analysis suggests that restrictions on the country of origin at the component level could backfire in the form of rising prices and supply instability. If the U.S. fully adopts a digital origin tracking system and includes component nationalities in regulatory oversight, simply changing the assembly country would not evade tariffs. In fact, the U.S. Inflation Reduction Act and the Chips Act have already excluded components manufactured in China above a certain percentage from subsidies. A financial industry insider in South Korea stated, "This tariff hike by the U.S. is not just a simple trade friction; ultimately, it aims to redefine the 'political nationality' of the supply chain. If America's allies and major corporations do not formulate joint response strategies, this move could further increase the uncertainty of the international industrial order." Original source: https://www.toutiao.com/article/1828745100153860/ Disclaimer: The article solely represents the author's personal views.