South Korea Seeks Swift Resolution on U.S. Auto Tariffs Amid Export Decline

South Korea's Industry Minister Ahn Duk-geun announced that Seoul is pushing for a swift resolution to the 25% U.S. auto tariffs in upcoming trade talks in Washington. The high-level meeting comes after the U.S. implemented sweeping 10% blanket tariffs and sector-specific 25% duties on automobiles and steel, with a temporary 90-day suspension on reciprocal tariffs from South Korea.

Speaking before his departure to Washington, Ahn emphasized that South Korea is preparing for the talks with “calm and care” but is prioritizing urgent measures for the automobile sector, which is heavily impacted by the new tariffs. The government recently introduced emergency support measures to ease pressure on auto manufacturers, including Hyundai and Kia, as tensions mount over trade and defense cost-sharing.

South Korea’s automobile exports to the U.S. reached $34.7 billion in 2024, representing 49% of total auto shipments. However, in the first 20 days of April, South Korea’s overall exports declined 5.2% year-over-year, largely due to reduced shipments to the U.S. Specifically, automobile exports fell 6.5%, while auto parts slipped 1.7%, underlining the sector’s vulnerability to U.S. trade policy shifts.

In addition to tariff concerns, Ahn acknowledged that the issue of defense costs could emerge during the discussions. U.S. President Donald Trump recently suggested reopening negotiations on the financial burden of stationing 28,500 American troops in South Korea, labeling the proposal part of a “one-stop shopping” approach to broader U.S.-South Korea negotiations. However, South Korean officials maintain that defense cost-sharing is not currently on the table.

The outcome of the trade talks will have significant implications for South Korea’s export-driven economy and its strategic relationship with the United States.