Seoul faces higher costs in Mexico as US tariffs persist, tightening squeeze on ROK automakers’ North American strategy

South Korea’s Ministry of Trade, Industry and Energy (MOTIE) said Wednesday it convened a joint government-industry meeting in Seoul to assess potential fallout from Mexico’s plan to raise import tariffs on countries without a free trade agreement. The Mexican government announced it will raise tariffs on imported goods, such as textiles, steel and automobiles. South Korean officials reviewed how the measure could affect Korean companies and discussed response strategies, noting that details of the Mexican proposal have not yet been announced.

MOTIE said Korean auto and home appliance manufacturers have built plants in Mexico to ship finished goods to the U.S. tariff-free under the US-Mexico-Canada Agreement, importing raw materials and parts from Korea. The ministry added that earlier Mexican tariff hikes in Aug. 2023 and April 2024 had limited impact because most Korean firms used local tariff-reduction programs such as Sectoral Promotion Program (PROSEC) and Manufacturing, Maquiladora, and Export Services Industry (IMMEX), but pledged to monitor developments closely and coordinate with industry and diplomatic missions to minimize any disruption.

South Korea’s Ministry of Trade, Industry and Energy (MOTIE) said Wednesday it convened a joint government-industry meeting in Seoul to assess potential fallout from Mexico’s plan to raise import tariffs on countries without a free trade agreement. The Mexican government announced it will raise tariffs on imported goods, such as textiles, steel and automobiles. South Korean officials reviewed how the measure could affect Korean companies and discussed response strategies, noting that details of the Mexican proposal have not yet been announced.

MOTIE said Korean auto and home appliance manufacturers have built plants in Mexico to ship finished goods to the U.S. tariff-free under the US-Mexico-Canada Agreement, importing raw materials and parts from Korea. The ministry added that earlier Mexican tariff hikes in Aug. 2023 and April 2024 had limited impact because most Korean firms used local tariff-reduction programs such as Sectoral Promotion Program (PROSEC) and Manufacturing, Maquiladora, and Export Services Industry (IMMEX), but pledged to monitor developments closely and coordinate with industry and diplomatic missions to minimize any disruption.

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