South Korea's IBK Economic Research Institute: If the United States imposes a 25% tariff on imported cars, South Korea's auto exports may decrease by 18.59%

U.S. President Donald Trump announced a 25% tariff on all imported cars starting next month, a move that analysts say is expected to deal a heavy blow to South Korean automakers that rely heavily on exports to the U.S. In 2024, South Korea exported $34.7 billion worth of cars to the U.S., accounting for nearly half of South Korea's total auto exports of $70.8 billion that year.

Experts point out that the 25% tariff will increase the price of Korean cars sold in the United States, ultimately affecting the Korean economy.

A report published by South Korea's IBK Economic Research Institute predicts that if the United States imposes a 25% tariff on imported cars, South Korea's auto exports to the United States will decrease by 18.59%.

Citi Research predicts that South Korea's gross domestic product (GDP) will decrease by 0.203% due to the US's 25% tariff on automobiles, parts, pharmaceuticals and semiconductors.