1. Stark Numbers: Hyundai’s Exports ‘Evaporated’
In the first half of 2025, Hyundai Motor’s U.S. export performance dropped dramatically. At first glance, this might look like a temporary dip, but the scale is beyond imagination. In just five months, Hyundai Motor Group exported only 7,156 EVs to the U.S. In the same period last year, it was approximately 59,705 units, a staggering 88% decline.
Such a sharp drop is not merely a matter of demand—it’s a clear signal that the supply structure and strategy are undergoing profound change. Including internal combustion engines, overall U.S. auto export revenue also fell by 27.1%, and the U.S. accounts for 36% of global EV exports—making it a critical market.
2. Strategy Shift: ‘Korea → USA’ Production Migration
The export plunge isn’t due to lack of demand. Hyundai has actually implemented a completely different supply chain strategy.
The key is the HMGMA Meta Plant in Georgia, which began full operation in 2025. Vehicles like the Ioniq 5 and EV9 produced there are no longer shipped from Korea. Instead, they are assembled locally and sold directly in the U.S.
This means that while export volumes have fallen, the shift signals the dismantling of Korea-centric production.
3. But Sales Have Dropped Too: Moving Production Is Not Enough
Despite shifting production locally, U.S. sales have fallen as well. From January to June 2025, Hyundai•Kia sold 44,555 EVs— a 28% decline from the same period last year.
Meanwhile, the entire U.S. EV market grew by 5.2%. In other words, the market expanded, yet Hyundai uniquely underperformed.
This suggests that production relocation alone is insufficient—it highlights the need for holistic adjustments in brand positioning, distribution, and subsidy alignment.
4. Tariffs & IRA: Two Policy Shockwaves Reshaping the Industry
Two major external factors prompted Hyundai’s strategic overhaul: high U.S. tariffs and the Inflation Reduction Act (IRA).
First, tariffs. The U.S. imposed a 25% import tariff on Korean-built vehicles, significantly eroding their competitiveness in the U.S. market.
Second, the IRA. This legislation only grants up to $7,500 in tax credits to EVs assembled within the U.S., excluding Korean-made models— making them far less attractive to American consumers.
As a result, Hyundai was forced to switch production to the U.S., and this shift underlies the export plunge we’re seeing.
5. The Cost to Korea: Industry, Employment, and Regional Economies Shaken
Hyundai’s global strategy may make sense for the company, but there's an underlying cost that Korea is now bearing.
- Reduced utilization of domestic plants: lines in Ulsan, Asan, and Jeonju have been scaled back.
- Pressure on parts ecosystems: suppliers tied to exports are seeing sales decline and facing restructuring.
- Employment insecurity: subcontractors and SMEs face job instability.
- Weakened regional economies: local tax bases erode, and property markets stagnate.
These aren’t mere business issues—they represent matters of national industrial strategy.
6. It's Not Just Export Decline: A Structural Reset of the Industry
This is more than a drop in export numbers—it’s a reset of the entire production and supply system.
The shift from export-centric models to local-production-first strategies affects labor markets, investment, and technology transfer across the board.
Korea is steadily being pushed from the center of automotive production. If this trend continues, the global balance of auto manufacturing will shift accordingly.
7. Questions We Must Ask
The company has made its strategic move. Now it's time for society and government to ask critical questions.
- What are the long-term implications for Korea’s economy?
- How will policy respond to this structural transition?
- Can we preserve employment and the parts ecosystem?
These aren’t auto industry questions alone—they apply to semiconductors, batteries, displays, and other strategic sectors.
8. Conclusion: Look Beyond the Numbers
The '88% drop' is not just a statistic—it’s a signal. Failing to understand the forces behind it could mean that Korea itself becomes the next casualty.
Hyundai is moving strategically. Now, Korean society and policy must close gaps in that strategy and develop long-term plans to restore what might be lost.
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