09-04-2025
- Automotive
- Wall Street Journal
South Korea Announces Emergency Support for Auto Sector Against U.S. Tariffs
South Korea's government has announced emergency-support measures for the country's auto sector, rushing to help ease the impact of U.S. President Trump's tariffs.
The measures set forth by the trade ministry on Wednesday include more of financial support, tax breaks and subsidies for carmakers.
The 25% tariff on cars and auto parts imported to the U.S. that Trump announced will cause 'significant' damage to South Korean automakers and parts manufacturers, the ministry said.
To prevent a liquidity crunch in the auto sector, the ministry said Wednesday it would increase policy financing support, including cheaper loans, for automakers to 15 trillion won, equivalent to $10.09 billion, in 2025 from 13 trillion won currently.
The government will also lower taxes on new car purchases to 3.5% from the current 5% temporarily until June, as well as raise subsidies for electric vehicles and extend the period of available subsidies by six months until the end of this year, it said.
Separately, the government will help Korean automakers expand export markets into non-U. S. developing economies in Africa, Latin America and Asia, where demand for vehicles has been growing fast.
South Korea's car exports to the U.S. stood at $34.7 billion in 2024, accounting for 49% of its total auto exports, according to the ministry.
Write to Kwanwoo Jun at
