Hyundai Motor Group’s luxury brand Genesis faces a major challenge in the U.S. market as the Donald Trump administration plans to impose a 10–20% universal tariff on all imports. The brand, which exports most of its U.S. vehicles from South Korea, may struggle to remain competitive unless it shifts production to the U.S. However, this move would require approval from domestic labor unions.
According to the auto industry on Feb. 2, Genesis sold 75,003 vehicles in the U.S. last year, marking an 8.4% increase from the previous year. Out of the brand’s total global sales of 229,532 vehicles in 2023, the U.S. market accounted for 32.7%, its highest share to date.
Hyundai launched Genesis as a standalone luxury brand in 2015 to overcome its image as a mass-market automaker and compete with premium brands like Toyota’s Lexus.
Since 2020, Genesis has seen remarkable growth. Its global sales surged from 77,135 units in 2019 to 132,450 in 2020. The brand expanded its lineup by introducing high-demand SUVs and launched the GV60, a compact electric SUV, in 2021.
Genesis has also gained traction in the highly competitive U.S. luxury car market. In 2020, the luxury brand sold just 16,384 vehicles in the U.S., but sales more than tripled to 49,621 the following year. Sales have continued to rise annually, though they still lag behind Lexus, which sold over 320,000 units in 2023. However, industry analysts say Genesis has been steadily establishing itself in the U.S. market.
This year, Genesis faces a significant challenge. Howard Lutnick, Trump’s nominee for U.S. Secretary of Commerce, said during a Senate confirmation hearing on Jan. 29 that the administration intends to impose high tariffs on exports to the U.S. “Our great allies have taken advantage of our good nature,” Lutnick said, specifically referring to South Korean appliances and Japanese steel exports. “It’s time for them to bring that production back home.”
Currently, nearly all Genesis vehicles sold in the U.S. are produced in South Korea. The only model manufactured locally is the GV70 electric SUV, which accounted for less than 4% of U.S. sales last year, with just 2,976 units sold. With Trump’s proposed cuts to EV incentives, Electrified GV70 sales could decline even further.
Industry experts believe Hyundai will struggle to avoid steep tariffs unless Genesis shifts production to the U.S. Its main competitor, Lexus, has been manufacturing key models in the U.S. since 2015, giving it a competitive edge if Genesis faces high import duties.
For Hyundai to begin U.S. production of Genesis vehicles, it must first obtain approval from its domestic labor union. A collective agreement signed in 1999 stipulates that any relocation of production to overseas factories or manufacturing of an existing model abroad must be reviewed and approved by the joint labor-management committee.
