The Chevrolet Trax Crossover manufactured by General Motors Korea. The automaker suffered a downturn last month amid high U.S. tariffs. Photo courtesy of GM Korea
SEOUL, Nov. 3 (UPI) — General Motors Korea saw its sales plunge more than 20% in October from a year earlier due to a slump at home and abroad amid high tariffs under the United States’ Trump administration.
GM Korea, based west of Seoul, said Monday that it sold 50,021 vehicles last month, down 20.8% year-on-year. The company’s domestic sales dropped 39.5%, while exports declined 20%.
Citing statistics from the Korea Automobile & Mobility Association, GM Korea Vice President Gustavo Colossi offered an optimistic view about its performance this year.
“Despite the production losses in the third quarter, demand for Chevrolet vehicles remains strong both domestically and globally, as evidenced by the Chevrolet Trax Crossover ranking No. 1 in domestic passenger car exports from January to September this year,” he said in a statement.
However, some observers remain worried about the future of GM Korea.
“Most of GM Korea’s turnover comes from exports to the United States. But the 25% tariffs have weighed on the company this year. Even if the duties go down to 15%, the struggle is feared to continue,” Daelim University automotive professor Kim Pil-soo told UPI.
“Worse, its domestic sales accounted for only about 3% in October, with just over 1,000 units sold. If the situation continues, speculation about GM’s withdrawal from Korea is unlikely to fade,” he added.
Originally, South Korean automakers did not pay any tariffs when exporting their cars to the United States, thanks to the bilateral free trade agreement that went into effect in early 2012.
The Trump administration imposed tariffs of up to 25% on Korean-made automobiles earlier this year, although Washington agreed to reduce the rate to 15% late last month in return for Seoul’s promise to make major investments in the United States.
GM Korea has denied rumors that it plans to leave South Korea.