The Ministry of SMEs and Startups (Minister Oh Young-joo, hereinafter referred to as the Ministry of SMEs and Startups) announced on the 15th that it visited the Korea Automobile Industry Cooperative located in Seocho-gu, Seoul, and held an on-site meeting to check the export conditions of the automobile parts industry due to changes in the global environment such as US tariff measures and transition to future cars, listen to companies' difficulties, and discuss response measures.
Auto parts are the fourth largest export item for SMEs, and exports in the first quarter of this year recorded $1.04 billion, a slight decrease of 0.4% year-on-year. On the other hand, exports to the US, the largest export country for SMEs, recorded $290 million, a 3.5% increase year-on-year, and exports to the US are leading all auto parts exports. In this situation, concerns are growing among our exporting SMEs as the US is imposing a 25% tariff on auto parts starting May 3.
Accordingly, the Ministry of SMEs and Startups held an on-site meeting to hear opinions from small and medium-sized auto parts exporters and to seek response measures to changes in the global environment, such as US tariffs. In particular, since cooperation with the auto parts industry is important for the auto parts industry, Hyundai Motor Company officials also participated in the meeting and discussed together.
Among the companies attending the meeting, CEO Jeong Sun-baek of Samkwang Wintech Co., Ltd., which produces automotive interior materials, mentioned concerns that domestic small and medium-sized partner companies may face worsening management difficulties due to the imposition of U.S. tariffs and suggested that emergency management fund support is needed for companies affected by the tariffs. In response, the Ministry of SMEs and Startups explained that it has newly established a trade risk emergency fund of 100 billion won in this supplementary budget to support small and medium-sized companies in the auto parts, steel, and aluminum industries, whose management environments are expected to worsen due to the U.S. tariff measures.
In addition, Mobiltech CEO Kim Jae-seung, a digital twin service provider, requested support for export certification costs for research and development equipment for the development of future vehicles. Accordingly, the Ministry of SMEs and Startups is operating an overseas standard certification acquisition project that supports consulting, testing, and certification costs necessary for obtaining overseas certification, and announced that it will secure an additional budget of 10 billion won through the supplementary budget this year to expand the number of participating companies and provide support.
In addition, various difficulties and suggestions were discussed at the meeting, including CEO Tae-Heon Kim of Motor Engineering Co., Ltd. mentioning the need to encourage joint advancement of large and small businesses to secure local investment and production bases in the U.S.
Minister Oh Young-joo emphasized, “The auto parts industry produces about 30,000 parts and forms the foundation of the auto industry ecosystem, and creates about 330,000 jobs, contributing greatly to revitalizing our country’s economy.” He added, “We will actively support small and medium-sized businesses to minimize damage from the U.S. tariff measures and to enable them to actively respond to global environmental changes such as the Fourth Industrial Revolution and strengthened environmental regulations.”
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