Trump auto tariffs take aim at a pillar of Asian economies

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Trump auto tariffs take aim at a pillar of Asian.jpeg

Written by Hyungo Jin and Cantaria Komia

Seoul/Tokyo (Reuters) -For Korea and South Korea, the tariff announced by US president Donald Trump is a blow to local car industries that are economic columns and sources of national pride.

Shares fell in companies such as Japanese Toyota, Honda, South Korea, Hyundai Motor and Corp Kia, which led to their value of about $ 16.5 billion, after Trump revealed on Wednesday a 25 % tariff on imported cars and light trucks to turn into force on April 3.

In the streets of Tokyo and Soulay, and in “Motor City” Guangzho, people were concerned that the drawings would have a long -term impact, and they spoke to the individual role played by the automotive industry in the post -war economic rise for American allies.

While car production helped to turn Germany, Italy and France after the Second World War, its impact on Asia was deeper. Car manufacturers are the nucleus of vast networks of group companies that affect almost every aspect of practical life in the two countries.

In Japan, where the industry represents approximately 3 % of GDP, car manufacturers – especially Toyota – determine a precedent for increasing national wages through annual talks between unions and management.

The total supply chain of cars was about 60,000 companies as of May last year, according to the TEIKOKU DATABANT. This industry is widely responsible for employing more than 5 million people, or 8 % of the entire workforce, according to the Association of auto manufacturers in Japan.

The auto industry in South Korea is its largest employer, and cars and auto parts are 14 % of exports. About half goes to the United States.

“The auto industry is the first thing that comes to mind for most people when mentioning manufacturing,” said Hiroshi Kojima, a 56 -year -old businessman at a material that spoke to Reuters in central Tokyo.

“I am concerned that this has a major impact on the economy and reaches the production of manufacturers in Japan.”

Understanding in Motor City

In Gwangju, South Korea, the home of the factories that topped the Kia’s Sportage, Soul and Seltos to the United States, “We are concerned about the volume of production and jobs”, this is what a KIA resource, who spoke on condition of anonymity, said.

Reuters told his factory that his factory was planning to continue the seizures on Saturday in April, but this request seemed uncertain.

The American auto company, General Motors, has factories in South Korea that exports more than 80 % of the produced vehicles, including the transitions to Chevrolet Trax and Arberblsen to the United States. It is likely to reach more than South Korea competitors, which produce more cars for the local market.

“We are tense,” a trade union worker told Reuters. He said that the administration previously told the federation that the production of 2025 would be compatible with last year, and has not yet updated its goals.

“We are very concerned about the absence of the South Korean president, who can address customs tariff issues,” the worker said, in referring to the political turmoil that started in December when President Yoon Sok Yiol announced for a short period.

The Minister of Industry in South Korea, Ahham Duk John, met with the executives of car manufacturers and suppliers on Thursday and expressed concern about the impact of definitions, especially for parts. Promise measures by April to reduce effect, including enhancing local investments and demand.

Japanese Prime Minister Shigro Ishiba said that Tokyo will put “all options on the table” and noted that Japan is the highest source of foreign investment in the United States, which is the government’s stress on Washington.

In 2023, Japan exported 4.4 million cars, including trucks and buses, with a third of going to the United States.

The tariffs struck a major part of the supply chains of most global auto manufacturers – Mexico, as for years building low -cost production rules.

Mexico is the most important vehicle for vehicles for the United States, as it represents 2.5 million light cars in 2023, according to the Mexican Automobile Industry Association. Nissan got a 10 % stake in that, the largest among Asian car makers, but less than General Motors, Stellantis and Ford.

Job concerns

For a 57 -year -old waitress, the etsuko fukada phase highlighted the difficult dynamics of Japan’s relationship with the United States. She said that Tokyo is unlikely to speak because of her dependence on Washington for her military defense.

The automotive industry has become more important with the influence of Japan in other areas – such as consumer electronics and fine chips – in recent years. Car manufacturers are still seen as the best destination for new graduates and competition for white collar jobs can be fierce.

The 24 -year -old graduate student, Mayu Morikawa, said that the customs tariff is afraid of its own horizons and that of a friend who has just started working in the field of cars.

In South Korea, Hyun Sang Jin said the definitions can threaten the quality of the lives of many people, given the country’s pivotal role in the country. “I think this will lead to a significant decrease in jobs,” said resident in Seoul.

(I participated in the reports of Hyunjoo Jin, Yeonbin Park and Dogyun Kim in Seoul and Kanaro Komia, Farid Miri, Chang Ran Kim and Daniel Liusenk in Tokyo; additional reports by Cenatia Kim in Seoul; written by David Doulan; edited by Mayung Kim and Catherine Evans)

2025-03-27 14:31:00

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