U.S. cuts tariff on Korean cars to 15%

Dec 02, 2025, 09:38 am

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Industry Minister Kim Jung-kwan (left) and U.S. Commerce Secretary Howard Lutnick embrace during a Korea–U.S. business roundtable at the Gyeongju Arts Center on October 29. / Source: Yonhap News

The United States announced Sunday that tariffs on Korean-made automobiles will be reduced from 25% to 15%, with the change applied retroactively to November 1, bringing Korean vehicles in line with tariff rates applied to Japan and the European Union.

U.S. Commerce Secretary Howard Lutnick said in a statement posted on the Commerce Department’s X account that Washington “will reduce certain tariffs, including lowering the auto tariff to 15% effective November 1, pursuant to the agreement.”

He added that the U.S. would also eliminate tariffs on aircraft parts and “un-stack” country-specific reciprocal tariffs on Korea to match those imposed on Japan and the EU.

Lutnick linked the move to Korea’s legislative follow-through on its commitments under the recent bilateral agreement. “Korea has formally begun implementing the strategic investment legislation in its National Assembly,” he said, calling the step “critical to ensuring that American industry and workers receive the full benefits of President Donald Trump’s trade agreement with Korea.”

The announcement follows the Democratic Party’s submission of the Special Act on U.S.-Korea Strategic Investment Management to the National Assembly on November 26. Industry Minister Kim Jung-kwan notified Lutnick in a letter the same day that the bill had been introduced and requested the swift publication of tariff reductions in the Federal Register, including the retroactive application of the auto tariff cut.

Formal confirmation via the Federal Register is expected soon.

Under the memorandum of understanding (MOU) signed by the two countries on November 14, Korea and the United States agreed that tariff reductions would be retroactively applied from the first day of the month in which Korea submitted the required legislation to its parliament.

Lutnick said Korea’s commitment to U.S.-bound investment “strengthens our economic partnership, supports American jobs and industry, and reflects our deep mutual trust,” adding that he looks forward to “building an even more robust and prosperous future together.”

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