The Korea Automobile Manufacturers Association noted that there are unfair aspects of the Korean automobile market towards American manufacturers.
Recently, concern has been raised that tariffs might be used as justification for trade policies against Korea, as U.S. President Donald Trump indicated that he would consider non-tariff barriers when imposing reciprocal tariffs.
On the 16th, the American Chamber of Commerce in Korea (AMCHAM) published its '2024 Domestic Business Environment Insight Report,' which includes 10 recommendations for the automobile industry.
AMCHAM stated in the report that "measures imposed under the pretense of environmental or safety concerns have created an uneven playing field for U.S. automobile corporations in Korea," and added, "As non-tariff barriers are resolved, U.S. automobile exports are expected to grow."
However, AMCHAM remarked that "protection measures, such as imposing new tariffs on imported automobiles and auto parts, may yield counterproductive results against the achievements that the U.S. automobile industry has made in Korea" and added that "AMCHAM will strive for both governments to work with the industry to dismantle remaining trade barriers."
AMCHAM criticized the procedures for establishing subsidies and testing methods for electric vehicles (EVs), as well as the overlapping regulations among ministries.
Regarding the South Korean government's procedures for establishing electric vehicle subsidies, it was suggested that "the decision-making process needs improvement, as sufficient prior discussions and reviews with stakeholders have been omitted or minimized, making the industry's response and preparation for annual domestic electric vehicle supply very inadequate."
AMCHAM claimed that regulations, including battery safety certification systems (Ministry of Land, Infrastructure and Transport), energy efficiency rating systems (Ministry of Trade, Industry and Energy), and electric vehicle certification and subsidy evaluations (Ministry of Environment), are being indiscriminately established by each ministry without prior coordination.
AMCHAM pointed out that under the Korea-U.S. Free Trade Agreement (FTA), if U.S. automobiles comply with U.S. safety standards (FMVSS) for up to 50,000 units annually, they are recognized as meeting Korean standards (KMVSS), but if the vehicles are produced in regions other than the U.S., they must undergo Korean certification again.
There are analyses suggesting that if the regulation for electric vehicles is relaxed and safety standards are exempted as per AMCHAM's request, American electric vehicle producer Tesla will benefit. Tesla sold 29,750 units domestically last year, ranking third in imported vehicles after BMW and Mercedes-Benz, and has been known to produce vehicles in China since the second half of the year before last to import them at lower prices than American-made vehicles.
AMCHAM also broadly mentioned regulations regarding internal combustion engine vehicles. Noting that South Korea's greenhouse gas reduction standards are strict, it stated, "It is necessary to set reasonable goals, considering the compliance status of automobile manufacturers, domestic electric vehicle demand changes, and adjustments to U.S. corporate average fuel economy standards."
Regarding regulations on hazardous substances in end-of-life vehicles, it suggested that "as there are no such regulations in the U.S., it is difficult for American automobiles to comply with the requirements" and recommended granting exemption permits for U.S. cars.
The report containing this information will be sent to both the South Korean and U.S. governments. AMCHAM plans to publish a 2025 report in the first half of the year.