South Korea announces emergency measures for auto industry

South Korea has announced emergency measures to support its auto industry in response to a 25% U.S. tariff on imported vehicles and parts, effective Thursday. The new tariff affects over $460 billion in annual trade and poses significant risks to Korean automakers, which export nearly half their vehicles to the U.S.

Key measures include:

• Increased policy financing to 15 trillion won ($10.2 billion) from 13 trillion won.

• Temporary tax cut on car purchases from 5% to 3.5% until June 2025.

• Expanded EV subsidies, now covering 30%–80% of prices (up from 20%–40%) and extended through year-end.

• Market diversification efforts, targeting growth in the “Global South.”

The government vowed to negotiate with the U.S. to ensure Korean firms are not treated unfairly and to support their global competitiveness. Hyundai Motor, meanwhile, committed to freezing U.S. prices for the next two months to ease consumer concerns.

Hyundai Alabama

This article was written by Eamonn Sheridan at www.forexlive.com.



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