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Key Points

South Korea's automotive export sector experienced a notable decline in May, with overall exports dropping 4.4% compared to the previous year. The decline was primarily attributed to US import tariffs and a comparative base effect from last year's record figures. Interestingly, eco-friendly vehicle shipments showed resilience, increasing by 10.2% and reaching a monthly record of 75,000 units. Despite challenges in traditional markets, Korean automakers saw growth in European and Asian export regions, signaling potential adaptive strategies.

Key Points: South Korea Auto Exports Drop on US Trump Tariffs

  • South Korea's auto exports fall 4.4% in May
  • US tariffs significantly impact North American shipments
  • Eco-friendly vehicle sales surge 10.2%
  • Export values remain second-highest for May
2 min read

Auto exports down in South Korea on US import tariffs

South Korean car exports decline 4.4% in May, impacted by US import tariffs and shifting global automotive market dynamics.

"The ministry attributed the overall decrease in auto exports to a base effect and impacts of Trump's 25 percent tariffs - Ministry of Trade, Industry and Energy"

Seoul, June 17

South Korea's car exports shrank more than 4 per cent from a year earlier in May as outbound shipments to the United States sharply dropped on Washington's hefty tariffs on imported vehicles, data showed on Tuesday.

The value of outbound shipments of automobiles came to $6.2 billion last month, down 4.4 percent from a year earlier, according to data from the Ministry of Trade, Industry and Energy, reports Yonhap news agency.

The figure marks the second-highest export value for any May but also the second consecutive month of decrease.

In terms of volume, exports fell 3.1 percent on-year to 247,577 vehicles. However, shipments of eco-friendly vehicles went up 10.2 percent to a new monthly high of 75,000 units thanks to strong demand for hybrid cars.

The ministry attributed the overall decrease in auto exports to a base effect from a record monthly figure posted a year ago and impacts of the U.S. Donald Trump administration's 25 percent tariffs on all imported cars and auto parts.

Exports to the U.S. slid 27.1 percent on-year to $2.5 billion in May, with broader shipments to the North American region dipping 22.3 percent to $3.08 billion.

Shipments to the Middle East also fell 7.2 percent to $391 million.

On the other hand, exports to the European Union and Asia increased 28.9 percent and 45.1 percent to $837 million and $683 million, respectively.

At home, sales of automobiles rose 0.4 percent on-year to 142,000 units in May, while domestic production went down 3.7 percent to 359,000 units.

Notably, monthly sales of eco-friendly vehicles surpassed those of internal combustion vehicles for the first time here.

More than 73,000 units of eco-friendly vehicles were sold in South Korea in May, up 39 percent from a year earlier, according to the ministry.

—IANS

- IANS

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Reader Comments

R
Rahul K.
Interesting to see how US tariffs are impacting global trade. While this is about South Korea, India should take note - we need to be careful about over-dependence on any single export market. Our auto sector is growing too! 🚗
P
Priya M.
The rise in eco-friendly vehicle sales in South Korea is impressive! India should push harder for EV adoption. Our government's FAME scheme is good but needs more awareness among consumers. Maybe we can learn from Korea's hybrid success.
A
Amit S.
Protectionist policies like US tariffs hurt everyone in the long run. India should focus on strengthening trade ties with EU and Asian markets like South Korea is doing. Our 'Make in India' initiative could benefit from such diversification.
S
Sunita R.
The data shows domestic production is down in Korea while sales are up. Sounds familiar? Same thing happening with Indian auto sector. Maybe time for more PLI schemes to boost local manufacturing instead of relying on imports.
V
Vikram J.
While the article focuses on negatives, the growth in eco-friendly exports is a silver lining. Indian companies like Tata and Mahindra should take this as inspiration to push their EV exports more aggressively in European markets.
N
Neha P.
This makes me wonder - how much do Korean car companies like Hyundai and Kia contribute to India's exports? We have several Korean auto plants here. Maybe they can redirect some US-bound production to India to avoid tariffs? Just a thought.

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