Sonata to become more expensive than Camry... Korean car exports to the US in crisis - Korean media

The US government has decided to lower tariffs on Japanese-made cars to 15% from the 16th of this month, raising concerns that this will weaken the competitiveness of Korean automakers.
South Korea continues to impose a high 25% tariff on automobiles, and the tariff gap with Japan is expected to widen by 10%. South Korea agreed to a 15% tariff rate through negotiations with the United States on July 30, but due to administrative procedures,
The difference in tariff rates with Japan is expected to have a further negative impact on automobile exports to the US, which have been declining since the beginning of this year.
According to the Korea Automobile Manufacturers Association (KAMA), automobile exports to the US from January to July this year totaled 801,109 units, down 8.4% from 874,182 units last year.
The number of U.S. auto exports for August fell from 124,745 units in April, when the 25% tariff on U.S. vehicles began, to 104,718 units in July.
Automobile exports to the United States are also likely to decrease compared to August last year (95,884 units). Automobile exports to the United States were also down 2.89 billion dollars (about 427 billion yen / down 19.6%) in April and 2.89 billion dollars (about 2.89 billion yen / down 19.6%) in May.
$2.516 billion (approximately ¥371 billion / minus 27.1%) in January, $2.69 billion (approximately ¥397 billion / minus 16.0%) in June, and $2.329 billion (approximately ¥344 billion / minus 16.0%) in July.
In the first half of the year, sales were down 4.6% to $0 billion, and in August (1st to 25th) they were down 1.58 billion dollars (approximately 233.3 billion yen, down 3.5%), both of which are down from the previous year.
Experts say that if the reversal of tariffs imposed by the United States on Japan and South Korea continues for a long time, South Korea's automobile exports to the United States could fall even more sharply.
Under the US-Korea Free Trade Agreement (FTA), Korean companies have been subject to tariffs 2.5% lower than Japanese companies, but starting this month, they will have to pay tariffs 10% higher.
For example, the base grade of the Hyundai Sonata currently on sale in the US is priced at $26,900 (approximately 3.97 million yen), while the base grade of the Toyota Camry is priced at $20,840 (approximately 3.97 million yen).
However, if the impact of the tariff gap between Japan and the United States is directly reflected in the sales price, the price competitiveness will be overturned.
Professor Moon Hak-hoon of the Department of Future Electric Vehicles at Osan National University said, "When comparing the Avante-class compact cars sold in the US, there is a 10% difference between Japan and Korea.
The tax gap could result in a price reversal phenomenon, with each vehicle costing 2 million won (approximately 212,000 yen) more than its Japanese rivals."
The difference may be even greater for larger or premium models, but raising prices would lead to a loss of market share, and the only way to prevent this is to accept losses.
Given the current situation, there is a possibility that export numbers may fall further."