South Korea Responds Urgently to US Semiconductor Tariff Plan, Samsung and SK Hynix Face Export Pressure

The US Department of Commerce is formulating a semiconductor tariff scheme. Chips produced in the US may receive a tariff exemption; otherwise, tariffs must be paid.

Author, Source: Wallstreet Insights

The latest US tariff moves are pushing Korea's core technology industries into a new realm of uncertainty.

On September 3, the Korean presidential office responded to the US Department of Commerce's proposed semiconductor tariff policy,emphasizing that the specific plan has not yet been finalized and that Seoul will do everything possible to ensure that the relevant measures do not harm the interests of Korean companies.

It is reported that on September 2 local time, Luttig, in an interview with CNBC, stated that careful and targeted semiconductor tariff measures would be implemented, linking US semiconductor investments with tariffs. If semiconductors are produced within the US, they will be exempt from tariffs; otherwise, companies should be prepared to pay the price (tariffs).

As dominant players in the global memory chip sector, Samsung Electronics and SK Hynix will be directly affected by this policy direction. An official from the Korean presidential office told reporters that the government is closely monitoring US developments and will maintain close communication with Washington to safeguard the interests of Korean semiconductor companies. As of press time, the US Department of Commerce has not issued any official documents regarding semiconductor tariffs.

Luttig Reveals Policy Framework, Core Logic Points to Manufacturing Reshoring

According to Luttig's remarks on CNBC's "Squawk Box", the Trump administration's proposed semiconductor tariff logic is straightforward:Companies that manufacture chips in the US will be exempt from tariffs; those that do not will have to "pay the price" for entry into "the world's largest market." He described this plan as a "targeted and well-considered tariff policy," and noted that major chip manufacturers had been informed in advance.

Luttig did not disclose specific tax rates or an implementation timeline during the interview. Analysts pointed out that this "production location-linked tariff" approach echoes the Trump administration's prior policy logic for industries such as automobiles, steel, and aluminum—that is, using access to the US market as leverage to force multinational companies to shift production capacity back to the US.

Korean Companies Already Have US Operations, but Short-term Export Pressure Hard to Avoid

Korea is a key link in the global semiconductor supply chain. Samsung Electronics is currently building a large-scale wafer fabrication plant in Taylor, Texas, while SK Hynix has set up advanced packaging facilities in the US. However, it is still uncertain whether these investments will quickly meet the exemption threshold after policy implementation.

Semiconductors are one of Korea's core export categories to the US. If the US imposes tariffs on chips not produced domestically, Korean companies will face significant pressure on export costs and pricing strategies. In the longer term, this policy may also reshape the geographic distribution of global semiconductor production capacity and increase operating costs for Korean wafer fabs.

Seoul Seeks Diplomatic Mediation, Aiming for Exemptions or Transitional Arrangements

Korea's Ministry of Trade, Industry, and Energy has already held multiple rounds of working-level consultations with the US regarding tariffs. Presidential office officials stressed that the top priority is "to prevent the situation from developing in a way that is unfavorable to Korean companies," hinting that Seoul may seek exemptions or a transitional period through diplomatic channels.

The presidential office’s statement comes at a particularly sensitive time for Korea-US economic and trade relations. Analysts believe that if this policy is eventually implemented, it may accelerate Samsung Electronics’ and SK Hynix’s decisions to expand investment in the US in the short term, but the scope for negotiation between the Korean government, industry, and the US will largely depend on the final details and pace of implementation determined by Washington.