Quick Takeaways
- Trump South Korea auto tariffs escalate as Washington cites delays in a 2025 trade agreement
- Tariff hike impacts vehicles, auto parts, pharmaceuticals, lumber, and broader imports
On January 26, President Donald Trump announced a sharp increase in Trump South Korea auto tariffs, raising duties on South Korean imports to 25% from 15%. The announcement was made via Truth Social and cited South Korea’s legislature for failing to approve a bilateral trade agreement reached in 2025.
The tariff escalation reverses earlier concessions under the administration’s reciprocal tariff framework. The decision affects automotive imports, vehicles and auto parts, pharmaceuticals, lumber, and all other product categories previously covered by the agreement.
In his post, Trump questioned the lack of legislative approval despite repeated affirmations of the deal.
“South Korea's Legislature is not living up to its Deal with the United States. President Lee and I reached a Great Deal for both Countries on July 30, 2025, and we reaffirmed these terms while I was in Korea on October 29, 2025. Why hasn't the Korean Legislature approved it?”
Trump South Korea Auto Tariffs Linked to 2025 Trade Commitments
Under the original agreement, South Korea committed to invest USD 350 billion in U.S. strategic sectors. In return, the United States agreed to reduce tariffs on vehicles and automotive parts from 25% to 15%, with the lower rates taking effect in November.
The Trump South Korea auto tariffs increase follows a formal communication sent two weeks earlier, in which the administration urged Seoul to finalize implementation of the accord. The lack of legislative action has now triggered the reversal of tariff reductions.
Hyundai Investments Central to US–South Korea Trade Talks
A major component of South Korea’s efforts to secure favorable trade terms has been large-scale industrial investment in the United States. Hyundai Motor Group announced USD 21 billion in U.S. strategic investments in March 2025.
In August, Hyundai expanded its commitment to USD 28 billion through 2028. The additional funding was earmarked for strengthening vehicle manufacturing, steel production, and robotics-intensive operations, reinforcing the automotive sector’s role in broader trade negotiations.
South Korea Awaits Formal Notification as Talks Continue
South Korea’s presidential office confirmed on January 27 that it had not received any official notice regarding the tariff increase. Despite the public announcement, no formal diplomatic communication had been delivered at the time of confirmation.
Meanwhile, South Korea’s trade minister, currently in Canada, is scheduled to travel to Washington D.C. for discussions with Howard Lutnick. The meetings are expected to focus on the status of the 2025 agreement and the future of Trump South Korea auto tariffs amid ongoing trade tensions.
The tariff escalation reverses earlier concessions under the administration’s reciprocal tariff framework. The decision affects automotive imports, vehicles and auto parts, pharmaceuticals, lumber, and all other product categories previously covered by the agreement.
In his post, Trump questioned the lack of legislative approval despite repeated affirmations of the deal.
“South Korea's Legislature is not living up to its Deal with the United States. President Lee and I reached a Great Deal for both Countries on July 30, 2025, and we reaffirmed these terms while I was in Korea on October 29, 2025. Why hasn't the Korean Legislature approved it?”
Trump South Korea Auto Tariffs Linked to 2025 Trade Commitments
Under the original agreement, South Korea committed to invest USD 350 billion in U.S. strategic sectors. In return, the United States agreed to reduce tariffs on vehicles and automotive parts from 25% to 15%, with the lower rates taking effect in November.
The Trump South Korea auto tariffs increase follows a formal communication sent two weeks earlier, in which the administration urged Seoul to finalize implementation of the accord. The lack of legislative action has now triggered the reversal of tariff reductions.
Hyundai Investments Central to US–South Korea Trade Talks
A major component of South Korea’s efforts to secure favorable trade terms has been large-scale industrial investment in the United States. Hyundai Motor Group announced USD 21 billion in U.S. strategic investments in March 2025.
In August, Hyundai expanded its commitment to USD 28 billion through 2028. The additional funding was earmarked for strengthening vehicle manufacturing, steel production, and robotics-intensive operations, reinforcing the automotive sector’s role in broader trade negotiations.
South Korea Awaits Formal Notification as Talks Continue
South Korea’s presidential office confirmed on January 27 that it had not received any official notice regarding the tariff increase. Despite the public announcement, no formal diplomatic communication had been delivered at the time of confirmation.
Meanwhile, South Korea’s trade minister, currently in Canada, is scheduled to travel to Washington D.C. for discussions with Howard Lutnick. The meetings are expected to focus on the status of the 2025 agreement and the future of Trump South Korea auto tariffs amid ongoing trade tensions.
Industry reports & Public Disclosures | GIA Analysis
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