President Donald Trump on Monday announced that he was raising tariffs on imported autos, pharmaceuticals, and lumber from South Korea from 15 percent to 25 percent, due to a delay in that country’s legislature approving a trade deal with the United States reached last summer.
Shares of Hyundai Motor dropped up to 4.77 percent immediately after the announcement, but since then have recaptured gains and were recently trading with a loss of 0.81 percent in volatile trading.
The South Korean company is the largest importer of new vehicles from that country into the United States. Reuters stated that the share price of Hyundai’s subsidiary Kia was down by 3.5 percent, and the affiliated Hyundai Mobis dropped by 5 percent.
Trump said in a Truth Social post, “South Korea’s Legislature is not living up to its Deal with the United States.”
Trump asked, “President Lee [Jae Myung] and I reached a Great Deal for both Countries on July 30, 2025, and we reaffirmed these terms while I was in Korea on October 29, 2025. Why hasn’t the Korean Legislature approved it?”
He wrote in a statement, “Because the Korean Legislature hasn’t enacted our Historic Trade Agreement, which is their prerogative, I am hereby increasing South Korean TARIFFS on Autos, Lumber, Pharma, and all other Reciprocal TARIFFS, from 15% to 25%.”
Therefore, the CNBC has sought the embassy of South Korea in Washington, D.C., to comment on the announcement made by Trump. Reuters said that South Korea’s presidential Blue House added that the U.S government had not officially declared South Korea to the tariff hike.
The news source has also reported that the presidential adviser of South Korea would have a meeting with the related ministries to deliberate on the measures regarding the increase.
South Korea ranks as one of the largest exporters of products to the United States. According to the Office of the U.S. Trade Representative, the U.S. imported $131.6 billion in goods from South Korea in 2024.
In the trade agreement declared in July, Trump mentioned that the number of blanket tariffs the U.S. will apply to imports of South Korea would be 15 percent, which is 10 percentage points lower than the mark he had previously threatened in the same month.
Trump stated that South Korea had agreed to “give to the United States $350 Billion Dollars for Investments owned and controlled by the United States, and selected by myself, as President.”
The U.S. Supreme Court heard arguments in a case about the legality of the unilaterally imposed tariffs by Trump in November, with justices appearing skeptical that he had the authority to impose such tariffs without Congressional approval. That is the case where the Supreme Court has not given its decision.
