NEW YORK, N.Y. — The 2025 New York International Auto Show is focused on the “international” portion of its name, albeit unintentionally.

President Trump’s 25% tariffs on the auto sector are the talk of the show, and for good reason, as all manufacturers at the show are having to grapple with their effects.

Korean automaker Hyundai (005380.KS) is in the middle of this trade war, despite the fact that the US and South Korea have strong trade relations. 

The automaker is pledging to protect its customers, for now, from tariff-induced costs.

“When it comes to the customers, which again is tough and even for us just for planning purposes, what we wanted to make sure is that we have a plan, so we launched our Hyundai Assurance Program, which is confirming and assuring to customers that [prices] are not going to go up, at least this next couple of months,” Claudia Marquez, Hyundai Motor America's COO, said to Yahoo Finance.

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Hyundai is able to stomach some of these costs because the automaker produces around 40% of its vehicles in the US, meaning those vehicles have no tariffs.

Localization of production has been part of the Hyundai game plan for some time now, and now more than ever, it’s part of the company’s tariff toolkit.

Read more: What Trump's tariffs mean for the economy and your wallet

“We have a strong representation in the US. We have a factory in Alabama, and just recently, two weeks ago, we opened our new Metaplant in Savannah, Georgia, where we produce our EVs Ioniq 5 and Ioniq 9,” she said.

The problem with building massive plants is that it takes time and costs billions of dollars. The US will elect a new administration in 2028, and auto tariffs could be gone by then.

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It’s perhaps why the all-new 2026 Hyundai Palisade, revealed at the NY Auto Show, will still be built in South Korea.

The three-row SUV offers new styling with a new hybrid powertrain providing over 30 miles of electric range and 620 total range (gas and electric). Those additions could be enough for the company to hike prices if needed and still maintain demand. Such is the power of a well-equipped, moderately priced large SUV in America — one that Hyundai can still build relatively cheaply in South Korea.

Hyundai is coming off its second-best March in terms of sales, with 72% of the volume in hybrid-powered vehicles.

Pras Subramanian is a reporter for Yahoo Finance. You can follow him on X and on Instagram.

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