South Korea’s electric vehicle exports to the United States have plunged to near zero as automakers shift production to the U.S. and federal tax incentives wind down.
According to data from the Korea Customs Service, just 164 EVs were shipped from South Korea to the U.S. in July, down 97.4 percent from 6,209 units a year earlier.
It was the lowest monthly total since Korea began expanding EV exports in 2021. In March 2023 alone, the country exported 13,280 EVs to the U.S., but volumes have since shrunk to barely 1 percent of that level.
From January through July, Korea exported 8,443 EVs to the U.S., an 88 percent drop from more than 72,000 during the same period last year.
Analysts point to the Inflation Reduction Act’s restrictions on EV tax credits, softening American demand, and Hyundai Motor Group’s pivot to U.S.-based production.
Hyundai, Kia, and Genesis—brands that dominate Korea’s EV exports—are now relying heavily on their new Georgia plant, where the Ioniq 5 is built and the Ioniq 9 will soon follow. Most of the EVs produced there are sold directly in the U.S., eliminating the need for imports.
The Federation of Korean Industries recently estimated that Hyundai’s U.S. EV sales could fall by more than 45,000 units annually, wiping out nearly $2 billion in revenue.
The slump has already affected domestic operations. Hyundai has temporarily suspended production at its Ulsan plant six times this year, including a weeklong shutdown in August, as orders for U.S.-bound models decline.
With the $7,500 federal EV tax credit set to expire next month, Korean automakers are stepping up efforts to diversify their export markets.
Industry officials say Europe and other regions with strong carbon-neutrality policies are becoming key targets. EV shipments to Europe and other destinations rose in July, lifting Korea’s overall EV exports by 12 percent year-over-year.
For U.S. consumers, the shift could mean fewer Korean-made EV imports but greater availability of locally built models.
Hyundai’s Georgia facility and Kia’s West Point plant are expected to play an increasingly central role in meeting American demand for Korean electric vehicles.
