American flags flutter outside a Hyundai automobile dealership in Irvine, California, U.S., March 27, 2025.
Mike Blake | Reuters
DETROIT — Hyundai Motor and General Motors are set to be two of the greatest beneficiaries of lower U.S. tariffs on imports, including vehicles, from South Korea.
The South Korean-based automaker is the largest U.S. importer of new vehicles from the country, followed by GM. Both automakers have paid billions of dollars in levies so far this year after President Donald Trump placed 25% tariffs on imported vehicles from South Korea and other countries in the spring.
The Trump administration this past week confirmed plans to lower tariffs on certain products, including vehicles, to 15% from South Korea. A notice about the implementation of the trade deal was posted Wednesday on the Federal Register. Other countries such as Japan and the United Kingdom also have negotiated lower tariff rates with the Trump administration.
Prior to the reduction, Hyundai reported U.S. tariffs costed the company 1.8 trillion won ($1.2 billion) in the third quarter, up from 828 billion won ($565 million) in the previous quarter. GM most recently said its tariff impacts, largely from South Korea and Mexico, were expected to be between $3.5 billion and $4.5 billion in 2025.
GM CFO Paul Jacobson said Wednesday that the automaker initially expected tariffs on South Korean imports to cost $2 billion but that the company has been able to offset many of those costs. He said GM expects the levies to cost closer to $1 billion or less in 2026.
“We do think that is going to be a tailwind next year, just not as much as the whole 50% because the ultimate tariff bill that we’re going to pay this year for Korea was going to be a lot lower than the $2 billion from the stuff that we’ve been working on,” Jacobson said during a UBS conference.
The U.S. tariff announcement comes after South Korea officially introduced legislation in its parliament aiming to fulfill its promise to invest $350 billion for the U.S. over several years.
Hyundai Motor Group Executive Chair Euisun Chung delivers remarks, as U.S. President Donald Trump, U.S. House of Representatives Speaker Mike Johnson (R-LA) and Governor of Louisiana Jeff Landry stand, in the Roosevelt Room at the White House, in Washington, D.C., U.S., March 24, 2025.
Carlos Barria | Reuters
“Korea’s commitment to American investment strengthens our economic partnership and domestic jobs and industry. We are also grateful for the deep trust between our two nations,” U.S. Commerce Secretary Howard Lutnick said in a statement posted Monday on X.
Hyundai North America CEO Randy Parker said the tariffs are still challenging but better than 25% as the automaker aims for a sixth-consecutive year of record U.S. retail sales in 2026.
“Fifteen percent is still 15%,” he told CNBC during a phone interview Tuesday. “Getting to 15% is a great milestone. It’s been quite the journey reaching this agreement, which has been, I would say, quite extensive.”
Hyundai, including its Kia subsidiary that operates separately in the U.S., has significantly increased its sales and operations in the U.S. in recent years. But the automaker continues to import the majority of its vehicles — estimated to be nearly 1 million units this year — from South Korea.
GlobalData estimates more than 1.37 million vehicles, or about 8.6% of the U.S. sales this year, will be vehicles that were imported from South Korea — making the country the largest exporter of American-sold vehicles aside from Mexico.
Hyundai is expected to import more than 951,000 vehicles in 2026, according to GlobalData. That includes more than 369,000 for Kia and 582,000 for Hyundai and its luxury Genesis brand.
Hyundai aims to have more than 80% of its U.S. vehicle sales be produced locally by 2030, the company said this year. That compares with roughly 40% currently.
Despite the tariffs, GM is estimated to import nearly 422,000 vehicles from South Korea this year to the U.S., according to GlobalData. That would be a 3.6% increase compared with record imports of more than 407,000 units last year.
GM has increasingly used South Korean plants to produce popular entry-level crossovers for Chevrolet and Buick. Its U.S. sales of South Korean-produced vehicles — largely entry-level models — have risen from 173,000 in 2019 to more than 407,000 last year, according to GlobalData.
GM, in an emailed statement, said the company “appreciates that negotiators have finalized an agreement on trade between the US and South Korea.”
“GM’s long-standing Korea operations produce high-quality, affordable crossovers that complement our U.S. vehicles and domestic production, which will soon rise to 2 million units. We will be monitoring and reviewing the details,” GM said.
GM produces its Buick Encore GX and Buick Envista crossovers, as well as the Chevrolet Trailblazer and Chevrolet Trax crossovers, at plants in South Korea. The company has touted the vehicles as being a pinnacle for the automaker’s profitable growth in lower-margin, entry-level vehicles.
Detainees are made to stand against a bus before being handcuffed, during a raid by federal agents where about 300 South Koreans were among 475 people arrested at the site of a $4.3 billion project by Hyundai Motor and LG Energy Solution to build batteries for electric cars in Ellabell, Georgia, U.S. September 4, 2025 in a still image taken from a video.
U.s. Immigration And Customs Enf | Via Reuters
The new U.S.-South Korea trade deal comes months after a period of tension between the two countries following an immigration raid at a battery plant jointly owned by Hyundai and LG Energy Solution in Georgia.
About 475 workers, including more than 300 South Koreans, were arrested in the Sept. 4 raid at the plant in Ellabell, Georgia, according to U.S. immigration officials.
