"Trump 2.0 Era Car Impact Inevitable... Focus on Exchange Rates, Tariffs, and Policies"

Donald Trump elected as the 47th President of the United States

Hana Securities predicted on the 7th that domestic automobile companies will face a more challenging market environment as Trump 2.0 begins.

Researcher Song Seon-jae stated, "With the start of Trump 2.0, Korean automobile companies will have to compete in a less favorable market environment than before," adding, "The biggest variables are the shifts in macroeconomic indicators and policies, with exchange rates and tariffs being the top priorities."

During Trump's first term, the USD-KRW exchange rate started at 1,170 won and fell to 1,060 won after one year, but then fluctuated up and down, ending at 1,100 won upon his departure. Currently, the USD-KRW exchange rate stands at around 1,397 won, which is more than 20 won higher than the average at that time. Since President Trump has negatively mentioned a strong dollar, it remains to be seen whether the exchange rate will actually decline after his re-election.

Researcher Song added, "Next will be changes in automobile industry policies," and predicted, "If all of Trump's pledges and statements materialize, the overall impact on Korean automobile companies is expected to be neutral to negative."

The market anticipates that the U.S. electric vehicle market will be negatively affected during Trump's administration. President Trump has hinted at rolling back eco-friendly car policies, including reducing subsidies under the U.S. Inflation Reduction Act (IRA) and revising the Corporate Average Fuel Economy (CAFE) standards.

However, Researcher Song noted, "Nonetheless, since Korean automobile companies have significantly enhanced their global competitiveness and market responsiveness, they are expected to adapt to and overcome the changed environment," adding, "Stock prices have already priced in related uncertainties and have fallen to low valuations, so further declines are expected to be limited."