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Hyundai Motor, GM make last-ditch appeal to US amid looming tariff threats

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Hyundai Motor Group Executive Chair Chung Euisun speaks during the carmaker's New Year event at at Hyundai Motorstudio Goyang in Gyeonggi Province, Jan 6. Yonhap

Hyundai Motor Group Executive Chair Chung Euisun speaks during the carmaker's New Year event at at Hyundai Motorstudio Goyang in Gyeonggi Province, Jan 6. Yonhap

Top execs from carmakers visit US to minimize tariff repercussions
By Lee Min-hyung

Hyundai Motor Group and General Motors (GM) Korea are making their last-ditch appeal to the United States ahead of President Donald Trump's planned 25-percent tariff on automobiles imported from Korea.

Bracing for the April 2 tariff threats from the White House, top executives from both carmakers are moving to seek a breakthrough by visiting the U.S.

No clear measures are visible to counter the escalating trade pressure, but they aim to appeal to the Trump administration by highlighting their strategic importance to the U.S. economy.

Hyundai Motor Group Executive Chair Chung Euisun is scheduled to visit the U.S. state of Georgia next week to attend a ceremony for its much-awaited completion of the Hyundai Motor Group Metaplant America (HMGMA).

The auto production facility will serve as a key manufacturing base for the carmaker. The Georgia plant was initially supposed to manufacture only electric vehicles (EVs), with an annual production capacity of some 300,000 vehicles, but the carmaker has decided to install equipment to produce hybrid vehicles at the same facility.

Under the updated strategy, the HMGMA will be capable of producing more than 500,000 vehicles annually to catch up with the growing demand for hybrids amid slowing EV market growth.

Hyundai Motor's Tucson SUV / Courtesy of Hyundai Motor

Hyundai Motor's Tucson SUV / Courtesy of Hyundai Motor

Chung is expected to underscore the importance of the facility for creating more jobs and localizing production in line with Trump's policy drive.

Last year, Hyundai Motor and Kia recorded combined vehicle sales of 1.71 million units in the U.S. Both automakers already operate production facilities — Hyundai in Alabama and Kia in Georgia — with a combined annual production capacity of approximately 700,000 vehicles.

Once HMGMA reaches full operation, the group's three U.S. manufacturing facilities will have a combined annual production capacity of approximately 1.2 million vehicles. However, this figure still falls short of meeting U.S. demand.

For this reason, some experts suggest the carmakers may increase investment to maximize localized production.

"Hyundai Motor Group has to maximize the production capacity in the U.S. to minimize aftershocks from the upcoming tariffs and keep promoting its efforts for the benefit of the economy there," said Kim Pil-soo, an automotive technology professor at Daelim University College.

"However, it is realistically tough for the carmakers to build more plants in the U.S. anytime soon, as multiple factors — such as high labor costs there — should be taken into consideration," he said.

GM Korea CEO Hector Villarreal, center, listens to questions from reporters during a press conference in Seoul, Feb. 2, 2024. Courtesy of GM Korea

GM Korea CEO Hector Villarreal, center, listens to questions from reporters during a press conference in Seoul, Feb. 2, 2024. Courtesy of GM Korea

GM Korea CEO Hector Villarreal embarked on his business trip to the U.S. on Saturday along with the firm's labor union executives. The delegation is scheduled to visit GM headquarters in Detroit to discuss details on how to tackle the looming tariff threats from Trump.

Along with Hyundai Motor Group, GM Korea is also highly vulnerable to the upcoming tariff, as the carmaker exports most of its vehicles to the U.S. As of last year, more than 80 percent of its vehicles produced here were exported to the U.S.

This has sparked continuous speculation that the local subsidiary of the U.S. carmaker may consider exiting the Korean market, as its revenue will plunge in the aftermath of the upcoming tariff.

Lee Min-hyung mhlee@koreatimes.co.kr


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