GM Korea’s outlook gloomy without EV production

General Motors Co. is unlikely to produce electric vehicles in South Korea as it aims to maximize the benefit of the US government’s tax credit on the eco-friendly automobiles, industry sources in Seoul said, weakening the long-term business outlook of its unit in the Asian country.

The US government, which aims at making half of all vehicles sold in 2030 electric in the world’s second-largest auto market, decided to remove tax benefits for EVs manufactured outside of North America, a move countering China’s growing influence in the global economy.

The policy is expected to undermine GM’s price competitiveness of EVs if the US auto giant produces them in other countries for its home market.

GM Korea Co. sells most of its vehicles in overseas markets. Last month, it exported 21,949 units including the Chevy Trailblazer and the Buick Encore GX, 84.2% of its total sales. The GM’s unit in South Korea specializes in the group’s smaller models including those sport utility vehicles.

The subsidiary operates GM’s largest production base in the Asia-Pacific with an annual production capacity of 920,000 automobiles, as well as 1.4 million engines and transmissions at three plants.

Write to Il-Gue Kim at black0419@hankyung.com
Jongwoo Cheon edited this article.