Hyundai Motor cautioned the U.S. administration that enforcing up to 25 percent tariffs on imported vehicles from South Korea would harm a security alliance between the two countries over North Korea’s nuclear ambitions.
The tariffs would hike production expenses at Hyundai’s U.S. factory by about 10 percent and “jeopardize” its U.S. investment strategy, the top South Korean automaker stated, echoing sentiments of other international automakers such as BMW.
The United States in May carried out an investigation into whether imported vehicles pose a national security threat and President Donald Trump has repeatedly threatened to impose tariffs soon.
The tariffs “would be devastating to Hyundai Motor”, Hyundai stated in comments to the U.S. Department of Commerce late on Friday, as per a post on a U.S. government website.
Hyundai also stated auto trade restrictions “would severely weaken Korea’s economy and therefore its capability to advance shared U.S.-Korea security interests in the region”.
“Although the recent summit between the leadership of the United States and North Korea has reduced tensions in the region, it is still critical for the United States and Korea to act in unison in order to resolve the nuclear issue,” it stated.
The auto sector represented 13 percent of total exports by South Korea, Asia’s fourth-biggest economy, in 2016.
Hyundai produces in the United States almost half of its automobiles sold in the nation, while affiliate Kia makes in the United States about a third of its vehicles sold there.