Tire makers brace for blows from U.S. tariffs, competitors

South Korea’s tire industry is on high alert as the United States moves forward with a 25 percent tariff on imported automobiles and parts, a category that includes tires. The tariff is raising concerns not only about increased costs but the intensifying competition from low-priced Chinese and Indian manufacturers as well.

Although U.S. President Donald Trump announced a 90-day delay in reciprocal tariffs for countries other than China on April 9th, 2025, he made no mention of the 25 percent tariffs already imposed on imported cars or the planned duties on automotive parts, which are set to be finalized by May 3rd, 2025. This omission has fueled expectations that imported tires will soon be subject to the same 25 percent tariff.

The U.S. is a key market for Korean tire makers. Combined U.S. sales for Hankook Tire, Kumho Tire, and Nexen Tire totaled around 4.2 trillion won ($2.95 billion) in 2024, accounting for 21 to 28 percent of each company’s total revenue.

Industry officials warn that should the 25 percent tariff take effect as anticipated, it could cost each company hundreds of billions of won in additional expenses.

Compounding the challenge is the lack of immediate alternatives. While Korean tire makers operate production plants around the world - including U.S.-based facilities owned by Hankook and Kumho - these plants fall short of meeting overall demand in the American market. This limitation leaves Korean tire manufacturers vulnerable, particularly as Chinese and Indian competitors prepare to lower prices to capitalize on the shifting trade landscape.