S. Korea's auto exports to U.S. drop in first quarter, even before reciprocal tariffs take effect

Korea's overall auto exports rose on-year during the first quarter of 2025, but shipments to the U.S. market declined over 11-percent ahead of U.S. tariffs.

Park Jun-han explains.

South Korea's automobile exports in March were valued at 6.24 billion dollars — the second-highest figure for the month on record.

Data released by the Ministry of Trade, Industry, and Energy on Tuesday showed that the earnings from automobile shipments posted year-on-year growth in both February and March, marking two consecutive months of gains.

Year-on-year auto exports to Asia and the Middle East in the first quarter saw significant increases of 37% ( 1) and 22.7% ( 2), respectively.

However, preliminary data shows that shipments to the United States fell by 11.2% ( 3) over the same period compared to last year.

The auto industry is concerned that the decline in exports to the U.S. will lead to a fall in South Korea's overall exports, as the 25% auto tariff could further reduce demand.

"We expect that exports to the U.S. will likely continue to decline this year, as prices rise due to tariffs and demand in the U.S. market drops significantly.

With demand from the U.S. weakening, South Korean car companies need to look for alternative markets to help make up for the shortfall."

As South Korea's automobile industry is directly under the influence of the United States' tariff policies,

the trade ministry laid out a policy support framework for Korean companies last Wednesday, after automobile tariffs separate from the so-called reciprocal tariffs went into effect.

The ministry said that it plans to swiftly implement necessary support measures and respond flexibly by closely monitoring both the extent of the damage and the progress of negotiations with the United States.

Park Jun-han, Arirang News.