Hyundai and Kia haven't raised their U.S. prices yet. Can that last?

Home > Business > Industry

Hyundai and Kia haven't raised their U.S. prices yet. Can that last?

Published: 11 Jul. 2025, 12:51

Audio report: written by reporters, read by AI

A car carrier transporting vehicles made by Kia, which is part of Hyundai Motor, arrives at Pyeongtaek Port in Pyeongtaek, Gyeonggi, April 15. [REUTERS/YONHAP]

Hyundai Motor and Kia are holding the line on prices in the United States, choosing to wait out trade uncertainty as the clock ticks on crucial tariff negotiations between Seoul and Washington.

On Tuesday, U.S. President Donald Trump postponed a planned round of reciprocal tariffs by about three weeks, setting a new deadline of Aug. 1. That extension gives Korea and the United States more time to negotiate, but it also creates a tense window during which the U.S. auto industry is ramping up aggressive promotions to seize market share.

As of Wednesday, Hyundai and Kia have not announced any price hikes. Back in April, immediately after Washington slapped a 25 percent tariff on imported cars, the two automakers pledged to keep U.S. prices steady through July 8. That deadline has come and gone with no new guidance from either company.

Japanese automakers have already cracked under pressure. Toyota Motor raised its U.S. vehicle prices by an average of $270 on July 1. Mitsubishi Motors bumped prices by $525 to $735 starting in June, and Subaru pushed prices up by as much as $2,055.

But for now, Randy Parker, CEO of Hyundai Motor North America told Automotive News on July 1 that maintaining reasonable price points is crucial to navigating what’s shaping up to be a tough second half of the year.

CEO of Hyundai and Genesis North America Randy Parker speaks at the Hyundai presentation during the New York International Auto Show at the Javits Center in New York on April 16. [EPA/YONHAP]

Industry experts say Hyundai and Kia are taking their time for good reason.

“A sudden jump in prices would directly hit sales, so they’re carefully weighing the direction of tariff talks and other factors before making any decision,” said Kwon Yong-joo, a professor of automotive transport design at Kookmin University.

A breakthrough on itemized tariffs for Korean-made vehicles could ease the pressure considerably.

The industry hopes Washington will cut tariffs on Korean cars from 25 percent to 10 percent. Officially, the United States maintains that reciprocal tariffs and sector-specific tariffs are separate matters not up for negotiation. But industry insiders see room to maneuver depending on how talks unfold. If negotiations stall or collapse there’s a risk that rates could rise.

Even as they hold out, Hyundai and Kia face steep cost pressures. The typical export of a 40 million won ($29,200) vehicle to the United States carries a tariff of around 10 million won.

Based on Hyundai and Kia’s combined U.S. exports of nearly 78,000 units in May alone, that translates to roughly 778.9 billion won in tariffs for the month.

The logo of Hyundai Motor is pictured at Pyeongtaek Port in Pyeongtaek, Gyeonggi, on April 15. [REUTERS/YONHAP]

Hanwha Investment & Securities estimates that the two automakers’ total tariff burden this year will reach 4.9 trillion won, equivalent to 34.4 percent of Hyundai Motor Group’s operating profit last year.

While Hyundai and Kia weigh their next steps, U.S. rivals aren’t standing still. Ford Motor on Tuesday launched a new promotion offering 48-month zero-interest financing on all models sold in the United States. The deal requires no down payment and lets buyers defer principal and interest payments for the first 90 days. Earlier this year, from April 3 to Monday, Ford sold cars at employee pricing and grew second quarter sales by 14.4 percent from a year earlier.

Hyundai and Kia have also slipped to third place in the U.S. electric vehicle market with a 7.6 percent share in the first half, behind General Motors at 13.3 percent.

“Ford, which ranked third in U.S. market share last year, is playing up its status as an ‘American company’ to fend off Hyundai and Kia, which were fourth,” said Cho Chul, a senior research fellow at the Korea Institute for Industrial Economics & Trade. “If that 25 percent tariff becomes a long-term fixture, Hyundai and Kia will have to quickly rethink their local manufacturing and parts supply chains.”

Translated from the JoongAng Ilbo using generative AI and edited by Korea JoongAng Daily staff.
BY KIM HYO-SEONG, OH SAM-GWON [[email protected]]