Hyundai is the biggest winner from the US and South Korea’s new trade deal, lowering the tariff rate on imported vehicles to 15%.
Hyundai gets a break with lower US tariffs
Hyundai has committed $26 billion toward its US operations, among the biggest of any automaker. Despite this, the automaker has shelled out billions since the Trump administration slapped a 25% tariff on South Korean imports earlier this year.
The Korean auto giant is catching a break after the US and South Korea signed a new trade deal that lowered the tariff rate to 15%.
A notice posted on the Federal Register on Thursday confirmed the rate cut and other adjustments under the new deal.
Hyundai took a 1.8 trillion won ($1.2 billion) hit from the added tariffs in the third quarter, up from just 828 billion won ($565 million) in Q3 2024.
Although it’s a lower rate, bringing it in line with Japan, which announced a similar deal in September, Hyundai will still have to pay billions in extra costs.
“Fifteen percent is still 15%,” Randy Parker, Hyundai North America CEO, told CNBC during an interview this week.
Parker said the tariffs will be a challenge, but Hyundai is aiming for a sixth consecutive record year of US retail sales in 2026.
Hyundai Motor, including Kia and Genesis, is expected to import nearly 1 million vehicles into the US this year, or about 40% of its sales. By 2030, Hyundai aims to have more than 80% of the cars it sells in the US manufactured locally.
Through November, Hyundai has sold nearly 823,000 vehicles in the US, up 8% from the same period in 2024, putting it on pace for its fifth consecutive annual retail sales record. Parker said Hyundai is “on a record pace and fully expect to go ‘5 for 5 in 2025.’”
To offset the loss of the $7,500 federal tax credit, Hyundai has been offering some of the largest discounts on electric vehicles.
The IONIQ 5, which has consistently been a top-selling EV in the US, is among the most affordable options with leases starting at just $189 a month.
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