Hyundai may raise U.S. prices to counter Trump auto tariffs

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Hyundai may raise U.S. prices to counter Trump auto tariffs

Published: 01 Apr. 2025, 17:39 Updated: 01 Apr. 2025, 18:20

SARAH CHEA
[email protected]

Audio report: written by reporters, read by AI

Vehicles move on the line at the Hyundai Motor Group Metaplant America on March 26 in Ellabell, Georgia. [AP/YONHAP]

Hyundai Motor may hike car prices for U.S. customers in response to U.S. President Donald Trump's upcoming 25 percent tariffs on all vehicle imports.

Randy Parker, CEO of Hyundai and Genesis Motor North America, recently warned U.S. dealers that the company was reviewing its pricing strategy, adding that “tariffs are not easy," Hyundai Motor said Tuesday.

“The current vehicle pricing is not guaranteed and may be subject to change for units wholesaled after April 2,” Parker said in the note.

Hyundai Motor Group Executive Chair Euisun Chung announces a $21 billion investment in the United States as U.S. President Donald Trump, second from right, and Louisiana Gov. Jeff Landry, far right, stand in the Roosevelt Room at the White House in Washington on March 24. [SCREEN CAPTURE]

Hyundai is one of the biggest victims of Trump's tariff tussle because it is heavily dependent on U.S. exports but produces cars in Korea. Hyundai and Kia, the country's two largest automakers, sold around 1.7 million cars in the United States last year, and of them, 57 percent, or 1 million units, were made in Korea, while some 140,000 units were made in Mexico, which is already subject to a 25 percent tariff on all of its imports.

Goldman Sachs analyst Mark Delaney predicted that the tariffs could raise the prices of foreign brand vehicles by $5,000 to $15,000, while those of U.S.-made vehicles would also rise by up to $8,000 due to the rising costs of auto parts.

Los Angeles-based Wedbush Securities also estimated that the tariffs could instantly push up car prices by $5,000 to $10,000.

Hyundai declined to comment on whether it planned to raise its prices but said it was “closely monitoring new policy developments” and would “continually review various business strategies to ensure long-term profitability.”

Kia Chief Financial Officer Kim Seung-jun hinted at a formal price increase during a conference call in January, saying it would be a measure to “hedge against increased expenses.”

SK Securities predicted that the levies would slash more than 10.7 trillion won from Hyundai and Kia's operating profit.

NICE Investors Service, a credit-rating agency in Korea, recently said that Hyundai and Kia would suffer a slash of almost 35 percent, or 8 trillion won, in operating profit, if the tariff were imposed.

Hyundai recently committed a $21 billion investment to the United States through 2028, which includes $6 billion to build a Hyundai Steel factory in Louisiana. It recently also opened an $8 billion manufacturing plant in Georgia, which includes an EV and hybrid facility and a battery plant.

BY SARAH CHEA [[email protected]]