On-site Meeting with Automotive Parts Industry
Listening to Challenges Amid Global Changes
Including US Tariff Measures and Transition to Future Vehicles
On May 15, the Ministry of SMEs and Startups announced that it had visited the Korea Auto Industries Cooperative Association in Seocho-gu, Seoul, to hold an on-site meeting to assess the export conditions of the automotive parts industry in response to global environmental changes such as US tariff measures and the transition to future vehicles, and to discuss countermeasures.
Automotive parts are the fourth largest export item among SMEs, with exports in the first quarter of this year reaching $1.04 billion, a slight decrease of 0.4% compared to the same period last year. In contrast, exports to the United States, which is the top destination for Korean SME automotive parts exports, increased by 3.5% year-on-year to $290 million, leading the overall automotive parts exports. In this context, Korean SMEs are expressing significant concerns as the United States began imposing a 25% tariff on automotive parts starting May 3.
Oh Youngjoo, Minister of the Ministry of SMEs and Startups, is delivering a speech at the "On-Site Meeting of the Automotive Parts Industry to Respond to Global Environmental Changes" held at the Automotive Industry Hall in Seocho-gu, Seoul on the 15th. Ministry of SMEs and Startups
In response, the Ministry of SMEs and Startups held this on-site meeting to hear directly from automotive parts exporting SMEs and to explore countermeasures to global environmental changes such as US tariffs. Given the importance of cooperation with finished vehicle manufacturers in the automotive parts industry, representatives from Hyundai Motor Company also participated in the meeting to join the discussions.
Among the companies attending the meeting, Jung Soonbaek, CEO of Samkwang Wintech, which manufactures automotive interior materials, expressed concerns about the deepening management difficulties faced by domestic SME partners due to the US tariffs, and requested emergency management funds to support companies affected by the tariffs. The Ministry explained that it has established a 100 billion won Emergency Trade Risk Fund through this supplementary budget to support SMEs in the automotive parts, steel, and aluminum sectors that are expected to face worsening business conditions due to the US tariff measures.
Additionally, Kim Jaeseung, CEO of Mobiltech, a digital twin service provider, requested support for export certification costs for research and development equipment needed for future vehicle development. The Ministry stated that it is operating the Overseas Certification Acquisition Program, which supports consulting, testing, and certification costs required for overseas certification, and that this year, it has secured an additional 10 billion won through the supplementary budget to expand support for participating companies.
Other issues and suggestions were also discussed, including Kim Taeheon, CEO of Motor ENG, who emphasized the need to promote joint overseas expansion of large and small companies to secure investment and production bases in the United States.
Minister Oh Youngjoo stated, "The automotive parts industry produces about 30,000 parts and forms the foundation of the automotive industry ecosystem, creating about 330,000 jobs and making a significant contribution to revitalizing the Korean economy." She added, "We will actively support Korean SMEs to minimize the damage caused by US tariff measures and to help them respond to global environmental changes such as the Fourth Industrial Revolution and the strengthening of environmental regulations."
© The Asia Business Daily(www.asiae.co.kr). All rights reserved.
