Taipei Times, Taiwan
Automakers cautious on South Korea, US free trade agreement
6 April 2007
AP, GOYANG, SOUTH KOREA. Automakers yesterday said they were hopeful a free trade agreement between South Korea and the US will prove a boon to their industry, but added they were taking a cautious approach until the deal gets final approval.
"The specific details of the free trade agreement are still being analyzed by all of the auto manufacturers," Michael Grimaldi, president and CEO of GM Daewoo Auto and Technology Co, said on the sidelines of the 2007 Seoul Motor Show. "We export our products around the world. We look forward to the resolution of the agreement."
Under the deal signed on Monday, South Korea and the US agreed to phase out all tariffs on cars. The US, which imposes a 25 percent import duty on pickup trucks, also said it would drop duties on those vehicles in 10 years.
Autos make up approximately 20 percent of South Korea’s exports to the US, the world’s biggest vehicle market.
Expressing optimism over the pact, Hyundai Motor Co said it would conduct a feasibility study on whether to start manufacturing pickups. The company, the world’s sixth-largest automaker in conjunction with affiliate Kia Motors Corp, does not make the vehicles.
Automakers from South Korea, the US, Europe and Japan were exhibiting their cars at the Seoul Motor Show, held every two years. The exhibition opened to the media yesterday in Goyang, near Seoul, with the general public allowed in for 10 days from today.
Cho Nam-hong, president and chief executive of Kia, was mum on what strategy his company would pursue regarding the trade deal.
"Every carmaker should review [its business plan] according to the FTA," he said. "We will wait and see for now."
Wayne Chumley, president of DaimlerChrysler Korea Ltd, said more would be known once the finer points of the pact emerged.