SEOUL (Reuters) - The United States and South Korea have agreed to revise a trade pact with a side deal to deter competitive currency devaluation by Seoul and with concessions for U.S. autos and pharmaceutical companies, Trump administration officials said on Tuesday.
In addition to increased access for American vehicles that meet U.S. but not necessarily South Korean safety standards, U.S. officials said they won reductions in non-tariff barriers to U.S. vehicle sales in the world’s 11th largest vehicle market, including elimination of duplicate environmental testing requirements and recognition of U.S. replacement parts standards.
In South Korea, vehicles made in the United States are a niche market, and most foreign models sold in 2017 were German and Japanese, according to South Korean vehicle registration data provided to Reuters.
In 2017, Koreans registered just over 42,000 U.S. made vehicles, many of them sport utility vehicles. Of those, nearly two thirds were vehicles made by German or Japanese automakers in their U.S. factories.
The Ford Explorer was the most popular U.S. made vehicle in South Korea last year, with about 6,000 vehicles registered, according to statistics compiled by the Korea Automobile Importers and Distributors Association.
South Korean consumers registered 4,843 U.S.-made models sold by the Jeep brand of Fiat Chrysler Automobiles NV last year, while General Motors Co’s Cadillac brand registered 2,008 U.S.-made models sold last year, according to the KAIDA figures.
The data does not include the 4,739 Chevrolet vehicles imported and sold by local manufacturer GM Korea last year.
Overall, however, South Korean consumers preferred American-made vehicles offered by German and Japanese brands. German luxury vehicle brands BMW AG and Mercedes-Benz registered 12,947 U.S.-made vehicles in South Korea in 2017. South Korea last year became the sixth biggest market for Mercedes.
Among Japanese automakers, Honda had the most success selling its U.S.-made vehicles to South Korean consumers, with 7,900 U.S.-manufactured Hondas registered last year.
Under revisions in the U.S.-Korea free trade agreement, U.S. automakers will be able to bring into South Korea 50,000 vehicles per automaker per year that meet U.S. safety standards, not necessarily Korean standards, up from 25,000 vehicles previously.
(For graphic on South Korean car imports, click: bit.ly/2E0mNDO)
Editing By Joseph White in Detroit, Robert Birsel