Seoul: South Korea's car exports fell by more than 4 percent in May compared to the previous year, primarily due to a significant decline in shipments to the United States, which imposed substantial tariffs on imported vehicles.
According to Yonhap News Agency, the total value of automobile exports reached US$6.2 billion last month, marking a 4.4 percent decrease from the same period last year, as reported by the Ministry of Trade, Industry and Energy. Despite being the second-highest export value recorded for any May, this figure represents the second consecutive month of decline.
In terms of volume, the number of exported vehicles dropped by 3.1 percent year-on-year to 247,577 units. Interestingly, exports of eco-friendly vehicles surged by 10.2 percent, reaching a new monthly high of 75,000 units, driven by strong demand for hybrid cars.
The ministry pointed to both a base effect from last year's record monthly export figures and the impact of the U.S. Donald Trump administration's 25 percent tariffs on all imported cars and auto parts as reasons for the overall decrease in auto exports.
Specifically, exports to the United States fell by 27.1 percent year-on-year to $2.5 billion in May. Additionally, shipments to the broader North American region declined by 22.3 percent to $3.08 billion. Exports to the Middle East also decreased by 7.2 percent to $391 million.
Conversely, exports to the European Union and Asia experienced growth, increasing by 28.9 percent and 45.1 percent to $837 million and $683 million, respectively.
Domestically, the sales of automobiles rose slightly by 0.4 percent year-on-year to 142,000 units in May, though domestic production decreased by 3.7 percent to 359,000 units. Notably, monthly sales of eco-friendly vehicles exceeded those of internal combustion vehicles for the first time in South Korea. Over 73,000 units of eco-friendly vehicles were sold in May, representing a 39 percent increase from the previous year, as reported by the ministry.