U.S. Commerce Secretary Howard Lutnick has confirmed a substantial cut in the general tariff rate on imports from South Korea, including automobiles, to 15%.
South Korea Moves to Activate Full Trade Deal
This decision is retroactive to November 1, 2025, as South Korea has introduced legislation in its parliament to fulfill its strategic investment commitments to the U.S. This move is expected to unlock the full benefits of South Korea’s trade deal with President Donald Trump.
Lutnick noted that the U.S. will remove tariffs on airplane parts and “un-stack” Korea's reciprocal rate to match those of Japan and the EU.
South Korea's ruling party has proposed legislation to advance Seoul's pledge to invest $350 billion in key U.S. sectors such as shipbuilding. Lutnick praised the strong mutual trust between the countries, noting that Korea's investment commitment reinforces their economic partnership while supporting U.S. jobs and industry.
The Evolution Of U.S.–South Korea Trade Talks
On November 14, the two countries published a "Joint Fact Sheet" formally elaborating the Korea Strategic Trade and Investment Deal. The terms of the deal include Korea lifting the cap on U.S. vehicles that can enter without extra modifications, easing documentation requirements for U.S. auto emissions certifications, and working with the U.S. to reduce non-tariff barriers in food and agriculture.
This includes faster biotech approvals, a dedicated U.S. Desk for horticultural products, and protecting market access for American meats and cheeses.
The U.S. had earlier applied a 25% tariff on imports from South Korea, including national-security-based auto duties under Section 232 of the 1962 Trade Expansion Act and "reciprocal" tariffs imposed through the International Emergency Economic Powers Act of 1977.
Earlier, in September, South Korean President Lee Jae Myung had pushed back on the terms of a proposed $350 billion trade and investment deal with the U.S, demanding a "commercially rational" agreement reflecting the interests of both nations.
In August, President Lee had pledged to revitalize the U.S. shipbuilding industry during his official visit to the United States. This commitment was part of South Korea’s efforts to strengthen its economic ties with the U.S.
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