Trump says tariffs on South Korea will rise to 25% as trade dispute jolts markets

A tariff warning aimed at Seoul’s stalled deal

On January 27, 2026, President Donald Trump said the U.S. would raise tariffs on South Korean imports—including automobiles, lumber and pharmaceuticals—to 25%, up from 15%, arguing that South Korea has not followed through on a trade agreement reached in 2025. The move, delivered in public remarks and posts covered by major outlets, immediately injected uncertainty into U.S.-Asia trade relations and corporate planning. ([theguardian.com](https://www.theguardian.com/world/2026/jan/27/trump-raises-south-korea-tariffs-carmakers-shares-fall?utm_source=openai))

Markets react as automaker shares wobble

The announcement triggered a short-term market response in South Korea, with shares of major automakers moving lower before stabilizing, according to reporting. For manufacturers and suppliers, the concern is less the day’s trading than the prospect that tariff levels could change quickly, affecting production decisions, pricing and investment. ([theguardian.com](https://www.theguardian.com/world/2026/jan/27/trump-raises-south-korea-tariffs-carmakers-shares-fall?utm_source=openai))

Dispute over what the 2025 agreement required

A key fault line is procedural: Trump argued South Korea failed to enact the deal, while Seoul’s side pointed to the agreement’s status and the pace of legislative approval. Reporting described emergency meetings in South Korea and efforts by political leaders to accelerate bills linked to the arrangement, while officials prepared outreach to Washington to prevent an escalation. ([theguardian.com](https://www.theguardian.com/world/2026/jan/27/trump-raises-south-korea-tariffs-carmakers-shares-fall?utm_source=openai))

What comes next for businesses

Companies exposed to U.S.-Korea trade—especially auto and industrial supply chains—now face a familiar choice: wait for formal legal steps and negotiate supply flexibility, or move quickly to hedge by shifting sourcing, inventory and pricing. Washington Post reporting also noted that the legality of some trade actions is being scrutinized in court, adding another layer of uncertainty for executives trying to plan around tariff risk. ([washingtonpost.com](https://www.washingtonpost.com/politics/2026/01/27/trump-south-korea-trade-tariffs/?utm_source=openai))

Whether the tariff threat becomes policy or remains a bargaining lever, it reinforces the volatility premium businesses have been pricing into cross-border trade since the start of Trump’s second term. ([theguardian.com](https://www.theguardian.com/world/2026/jan/27/trump-raises-south-korea-tariffs-carmakers-shares-fall?utm_source=openai))