General Motors is currently the only American automaker that builds vehicles in South Korea and exports them to the United States. The Asian country may seem like an unexpected place for GM to building key strategic models like the new Buick Encore GX and Chevrolet Trailblazer crossovers, for example, but there’s one very good reason for GM to keep on leveraging its South Korean manufacturing base: tariffs.
Chevy Trailblazer production starts at GM’s Bupyeong plant in Incheon.
While the trade war between the United States and China continues to ramp up and automakers grapple with new vehicle import and export tariffs, South Korea remains unaffected. Automakers are able to export vehicles from the country to the U.S. tariff-free, seemingly making it an attractive place to build vehicles. But as CNBC points out, automakers do not flock to the region due to the tough labor unions in the country, which are known to strike. GM has experienced its share of problems with the Korean labor union representing its workers, which staged a number of temporary walkouts last year. The company has also faced other business challenges in South Korea and even had to bail out GM Korea in 2018 with the help of the South Korean government.
“The downside of South Korea has always been the unions are tough,” IHS principal automotive analyst Stephanie Brinley told CNBC in an interview. “They’re very difficult to deal with.”
It would not be worth it for a company like Ford to set up shop in South Korea with the sole intent of skirting import tariffs, as it would take years to pay off the investment. GM was already well established in South Korea long before tariffs became a major talking point within the Trump Administration, though. GM Korea’s roots are tied to Daewoo, a defunct Korean car company that GM acquired the assets of in 2002. The automaker has since used GM Korea as a launchpad for its small series models like the Chevrolet Aveo and Spark, the latter of which is currently built at the GM Changwon plant in the country’s South Gyeongsang province. GM Korea also currently builds the Buick Encore GX, Buick Encore, Chevrolet Trailblazer and Chevrolet Trax at its GM Bupyeong assembly plant.
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Comments
It helps to have a U.S. Congressman on Korean Trade Committee who is a Chevy/KIA dealer………….Hmmmmm!!
Sorry about your U.S. jobs!
Most people couldn’t give a rat’s a** about jobs. They just want a car or suv they can drive at an affordable price with the features they want. That’s why Toyota, Honda, Mazda, Subaru, Mitsubishi, Kia, Hyundai et al , are able to sell so many cars here and people couldn’t care less where the head office is or which country it’s from.
Exactly, especially the Japanese companies who are allowed to build in the US. If the average consumer who buys Japanese knew of all the economic negatives for the United States and American manufactures, I believe they would think otherwise.
And the key question for GM and it’s stockholders is what happens if the maniac leader of North Korea’s attacks the South Korean cities especially since Trump gave up on negotiations with Him. Or their other plants in China what happens in the South China Sea if China attacks thei neighbor’s and the U.S. has to get involve to protect them from China or even a worse corona virus spread in the future ,these plants ,parts sources ,tooling and billions in investment evaporate ,when they could have build these key new models easily in North America ,still could all we need is will!
You’re clueless if you believe that S. Korea will ever be attacked by the North. 1st of all,China would never let it happen and if they did, N. Korea would be a smoking hole in no time.
Hey John, the smoking hole in your theory is the unfinished Korean War that the U.S. and U.N.nations fought against the north and China that was fought to a Mexican standoff in the mid 1950’s at the 49th parallel and currently they have long range artillery and missile system pointed directly at Soeul Korea and a million man + army that even with the fifty thousand US personnel will do a ton of damage to the south before any conflict could be resolve either way, and by the way the Communist Chinese are not your U.S. friends and will do anything to eat your economic lunch ,i’s just a matter of time ! !
Simply hilarious. You know nothing of the relationship between China and DPRK. Always funny when someone like you lectures a Vietnam-era veteran like myself who knows far more about the military, that knows exactly what missiles are pointed where. I was in Air Defense Artillery BTW. Please save your lecture for middle schoolers and low IQ Trump voters.
Wow you certainly are a real missile professional too bad you weren’t’ in Korea when Gen.MacArthur needed .an expert on A-bombs before Truman fired him . Lets hope you are as right as you think you are on air defense, because all those so called low IQ Trump voters you just insulted will be very angry if your completely out to lunch on peace in Korea !
Whether I was in Korea when he landed is irrelevant. And again,I have known for decades our airborne might in Asia and other parts of the world. Most of them will crawl back under their rocks after next January,never to be heard from again, thankfully. China rules NK.When you understand that, you will understand much more about DPRK.
Actually John, you’re reply to Gary’s original post shows you have a video game mentality and don’t understand warfare and its repercussions. If you were calling the shots, tens of thousand’s of American soldiers would not be coming home!
Yeah,and you do! You couldn’t be more wrong but it’s what what I expect from someone who never served in wartime or served at all. Clown.
Theres part of the problem, you were in the military and have been conditioned to think that life doesn’t matter and anyone who believes otherwise is the enemy.
If you produce a reliable and quality vehicle, they will buy it. Competition is good for the economy.
Well GM is happy about screwing the American worker.
At what point in time will they realize that if we don’t have jobs we can’t be a consumer.
GM just give Trump the BIRD!
Sorry Mr.President.
You’re not supposed to deep-throat the entire boot
well it is a reality of the times if the manufacturers in the 60s,70s and even 80s had the cash or the will to invest in fuel mileage and quality the big 3 and maybe even AMC would be the envy of the world in vehicles.
must be import fans giving that a thumbs down toyota honda and pearl harbor
GM is also the only American vehicle manufacturer that EXPORTS US made vehicles to South Korea…..
On my 2020 Bolt window sticker:
Country of Origin:
Engine (motor) Korea
Transmission (electric drive unit) Korea.
If you think all components will be manufactured in USA, you are as out of touch as Trump . GM and every other manufacturer are Global Companies and do no rely on their own countries to source all components, major or minor. GM has manufacturing and financial interests in Korea and they are well within their interests to use quality components sourced from that division,
I understand walt does not like trump but these issues started way before trump I think you can blame the others also just saying
So the next time international Oriented GM is in Financial trouble like 2008-9 they will be bailed out by Korea ,India,China .and Mexico rather than the U.S. and Canadian bankruptcy loans . If you believe that I’ve got a bridge in Brooklyn to sell you .Free fair trade is great especially if it is a two way street with no tariffs on either side to grow all economies ,it doesn’t always happen!
Korea bailed out GM there recently. Learn before you post.
South Korea acted only to support and prop up their domestic economy from irate disgruntled assembly workers who were in major strike mode and GM leaving because of too high of wages , a tid-bit compared to the amount of funding GM got from the U.S. and Canada in 2008-9 ,I bet you could be wrong a lot more than right in your own mind !
You are wrong, period. But choose to understand/twist/interpret the facts as you like. I get you love US auto workers and hate GM.And I am right far more than wrong.And far more than you. I get that you think EVERY GM vehicle should be made in the US-which is sad.
GM is an an American managed and headquartered company ,yes it would have been nice if an important new generation of Chev and Buick compact vehicles were designed ,build ,and subsequently mainly sold here in the North America market place would have been built here ,but it won’t be . That doesn’t mean you shouldn’t want the best for your country and workers it called American ingenuity and know-how , not Korean , John!
there is little to no profit in it so they will do whatever they can offshore to stop the bleeding
Uh,who said I didn’t want the best for my country? Don’t confuse the 2. That have nothing to do with one another.
GM exports the Silverado, Arcada, and Colorado to SK. And the Equinox from Canada, not Mexico.
Ford (mentioned in the article) exports NOTHING from the US to SK. But it imports the EcoSport, the Ford offering in the Trailblazer/Trax segment from India.
Camaro more too.
I have been looking for a new Chevrolet Equinox. Most are built in Mexico. But once in awhile I find one built in Canada.
Recently I found a 2020 Equinox ,orange in color, and built in Canada. . Does anyone know if GM Canada builds better
cars than GM Mexico??
Kavn,Your darn right G.M.’s Canadian Ingersoll Ontario plant builds real good quality Equinox vehicles as they have done over the last Ten years or so ,as they build both the Terrain and Equinox up here before the Terrain was sent south in tha last couple of years and so have some Equinox ,many American buyers love vehicles like Impala built at Oshawa Assembly in that they actually built Impala ,and finished past model Equinox by painted and trimmed past models Equinox in the same facility before Terrain left for Mexico To attain volume in their modern Paint facility now permanently closed in Oshawa like Lordstown by GM headquarters in Detroit !