The American International Automobile Dealers Association (AIADA) is cautiously optimistic about recent modifications to the U.S.-Korea Free Trade Agreement (KORUS).
KORUS was first adopted in 2007 and went into full effect in 2012.
On Tuesday, South Korea and the United States agreed to revamp the agreement, that President Donald Trump has called a job killer. Under the revised agreement, the number of vehicles each U.S. automaker can export to South Korea doubles.
It also extends a 25 percent U.S. tariff on South Korean pickup trucks through 2041. In exchange, South Korea will be exempt from the U.S. 25 percent steel tariff but must accept steel exports quotas.
“Uncertainty around global trade is an obstacle for all American businesses, large and small,” AIADA President and CEO Cody Lusk said. “Today’s announcement of an agreement in principle is good news for auto dealers who rely upon their brands to make complicated manufacturing decisions based upon reliable, long-term trade agreements. The alternative, in which the U.S. pulls out of the KORUS agreement, would have devastating consequences for America’s 1,600 Kia and Hyundai dealers and their more than 110,000 employees.”
South Korea is the United States’ sixth largest goods trading partner. In 2016, $112.2 billion in goods trade were traded.