The 25% Tariff on Imported Trucks: CRS Evidence vs. Korea’s Misleading Narrative

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References

• Primary Source: Congressional Research Service (CRS), Presidential 2025 Tariff Actions: Timeline and Status, R48549 (Sept 16, 2025)R48549.10

• Secondary Sources: Reuters, AP, Yahoo Finance (Oct 2025 coverage of Trump’s 25% tariff on imported medium and heavy-duty trucks).

• Tertiary Context: Korean press (조선, 중앙, 매경, etc.).

Executive Summary

On October 6, 2025, President Donald Trump announced a 25% tariff on imported medium and heavy-duty trucks, effective November 1, 2025. U.S. media reported this as a significant escalation in his protectionist agenda, citing national security and unfair competition as justification.

However, the CRS official report (Sept 2025) shows that truck tariffs were still under Section 232 investigation—pending determination at that dateR48549.10. This demonstrates a clear sequence: (1) investigations launched, (2) proclamation announced, (3) media coverage on timing.

In Korea, mainstream outlets distorted this process. They claimed not only that truck tariffs already applied but also conflated this with the steel/aluminum measures, presenting closures in Pohang as a direct result of U.S. tariffs. This is factually false. The closures stem from overcapacity, debt, and energy costs, not tariffs still under review or pending implementation.

Five Laws of Epistemic Integrity

1. Truthfulness of Information

• CRS: trucks = under investigation until September; tariffs formally announced October for November startR48549.10.

• U.S. media: consistent with proclamation, cautious in scope.

• Korean media: reported tariffs as “already in force,” linking to factory closures. False.

2. Source Referencing

• CRS + Federal Register are official.

• Reuters/AP explicitly mention effective Nov 1.

• Korean press lacked such referencing, relying on political framing.

3. Reliability & Accuracy

• CRS timeline matches legal processes.

• International media aligns with announcement → implementation gap.

• Korea’s coverage erases this gap, creating misleading immediacy.

4. Contextual Judgment

• Truck tariffs are relevant but not causal for steel shutdowns in Pohang.

• Narrative misused externally driven tariffs to mask domestic industrial mismanagement.

5. Inference Traceability

• CRS → pending in Sept → proclamation Oct → tariff effective Nov.

• Media (Reuters/AP) → faithful to this sequence.

• Korea → collapsed timeline, manufactured causal link.

BBIU Structured Opinion

The 25% tariff on trucks shows how policy reality diverges from media narratives. U.S. sources tracked the legal path; CRS documented pending status; media confirmed proclamation. By contrast, Korea’s domestic press erased temporal distinctions, translating “pending” into “applied.”

This distortion is not accidental—it is a political device to externalize blame for factory closures. Korean steel producers face structural problems (overcapacity, energy costs, debt), but the media frames Trump’s tariffs as the sole villain. This tactic obscures accountability and amplifies public anxiety.

For investors and policymakers, this highlights a critical analytical lesson: always cross-check local narratives with CRS and Federal Register sources.

Annex 1 — Heavy Truck Manufacturing and the U.S. Tariff Shock

Introduction

The October 2025 proclamation by President Donald Trump to impose a 25% tariff on all imported medium and heavy-duty trucks (class 7–8, including the iconic 18-wheelers) is not an isolated policy. It is the crystallization of a doctrine: if you want access to the American market, you must produce in America. This annex examines the structural implications of the tariff by mapping the largest truck manufacturers for the U.S. market, the distribution between domestic and imported supply, and the political contradictions emerging around drivers, logistics, and labor migration.

1. The Market Landscape of U.S. Heavy Trucks

The U.S. trucking industry is one of the most critical arteries of the national economy. More than 70% of domestic freight is moved by trucks, and in the heavy-duty segment (class 8 trucks, or 18-wheelers), the sector consumes over 25% of all diesel fuel in the country.

• Domestic leaders:

  • Daimler Trucks North America (Freightliner, Western Star) – Freightliner alone controls the largest market share of U.S. class 8 trucks, often exceeding 35%.

  • PACCAR (Peterbilt, Kenworth) – two of the most iconic U.S. brands, focused on long-haul and premium fleet operators.

  • Navistar (International Trucks, owned by Traton/Volkswagen) – a U.S. company with deep historical presence, but owned by a European conglomerate.

  • Volvo Trucks North America & Mack Trucks – part of Volvo Group (Sweden), with significant U.S. production facilities.

• International suppliers / importers:

  • Isuzu Commercial Truck of America – Japanese brand, importing medium-duty trucks.

  • Mitsubishi Fuso – historically imported light and medium trucks into the U.S. before scaling down.

  • Mercedes-Benz Trucks (Daimler parent company) – certain models imported, although Daimler already produces locally through Freightliner.

  • Hyundai & Kia (Korea) – not yet major players in U.S. heavy-duty, but increasingly developing electric and hydrogen trucks, which could target the U.S. market.

Key point: while U.S. domestic production is strong, imports account for roughly 40% of consumption in the class 8 segment, mostly from Mexico and Canada but also from Europe and Asia. This is the portion Trump is directly attacking with the tariff.

2. Structural Objective: Forcing Relocation of Global Production

The tariff is not about punishing a single country. It is a universal lever designed to make all manufacturers – European, Japanese, Korean, or Mexican – face the same decision:

Either you build trucks inside the United States, or you pay 25% to enter the market.

This mechanism functions as a long-term escape valve: it gives companies the signal that the American market will no longer tolerate dependence on imports, while leaving a short window of time to relocate production lines.

• Daimler / Mercedes-Benz Trucks: must reinforce Freightliner’s local capacity and avoid reliance on imported specialized models.

• Volvo/Mack: already produce domestically, but must increase U.S. content to secure exemption.

• Hyundai / Kia / Isuzu: if they want a foothold, they will need to build plants on U.S. soil.

The logic is simple: every truck driving on American roads will eventually carry the label “Made in USA.”

3. Impact on Inflation

The immediate effect is inflationary pressure.

• New trucks become more expensive due to tariffs.

• Transportation companies must pay higher capital costs, pushing freight rates upward.

• These costs cascade through the economy: groceries, consumer goods, construction materials – all become more expensive.

Analysts estimate an additional 0.2–0.4% increase in the Consumer Price Index (CPI) in the short term, specifically from logistics costs.

4. Employment Contradictions

While Trump emphasizes job creation in truck manufacturing, the system faces a contradictory shortage: truck drivers.

• The U.S. trucking workforce is already short by 60,000–80,000 drivers, with projections of a 100,000 deficit by 2030.

• Average age is above 50, with high turnover and harsh working conditions.

• Wages are rising (>$70,000 per year on average, potentially exceeding $100,000 on key routes), but not enough to attract sufficient new entrants.

Trump’s migration crackdown further limits the available labor pool:

• ICE raids and strict enforcement discourage companies from hiring undocumented workers (long a hidden component of the trucking workforce).

• English-only pressures mean foreign drivers must clear language and certification hurdles, slowing labor inflow.

Result: more trucks produced, fewer drivers available → idle capacity, higher costs, further inflation.

5. International Migration and the Slow Relief

High U.S. salaries will inevitably attract foreign drivers from Latin America, Eastern Europe, and Asia. But the process is slow and bureaucratic:

• Visa categories (H-2B, H-1B) are not adapted to long-haul trucking.

• Federal requirements (CDL licensing, safety exams) take time.

• English proficiency filters out much of the potential labor pool.

Thus, migration could eventually fill the gap, but not in the timeframe Trump’s tariffs will create demand.

6. Paradoxical Environmental and Consumer Effects

Paradoxically, the policy could yield positive second-order effects:

• If imported trucks are too expensive, U.S. logistics companies will purchase newer, domestically produced trucks.

• This accelerates fleet renewal, lowering maintenance costs and increasing fuel efficiency.

• Newer trucks emit less, creating an indirect environmental benefit even though Trump’s policy is not designed as green regulation.

In turn, lower maintenance and higher efficiency eventually support consumer purchasing power once the transition stabilizes.

7. Symbolism: The 18-Wheeler as Industrial Sovereignty

The American 18-wheeler is more than a machine – it is a cultural symbol of freedom and commerce. By forcing these vehicles to be produced in the U.S., Trump transforms them into a living emblem of industrial sovereignty:

• Every truck on the highway becomes proof of “Made in USA.”

• Every consumer good moved inside the U.S. carries, symbolically, the narrative of repatriated industry.

This symbolism reinforces his political base, particularly in the Midwest and industrial states, where trucking is not just a business but a way of life.

Annex 2 — Korea’s Misleading Narrative: From Truck Tariffs to the $350B Deal

Introduction

In 2025, South Korea’s domestic media and government messaging built a narrative that systematically misled the public about the scale, timing, and nature of U.S. tariff measures and investment demands. What began as coverage of a single policy — tariffs on imported trucks — quickly expanded into a larger distortion: steel and aluminum tariffs presented as “already applied,” a $350 billion investment deal reframed as “still under negotiation,” and the Special Purpose Company (SPC) leak portrayed as confiscation. This annex reconstructs the sequence, showing how the Korean narrative diverged from U.S. official statements and international reporting, and how this divergence eroded both domestic trust and international credibility.

Tariffs and the First Distortion

Early in 2025, outlets such as Newsis and Hankyoreh ran headlines declaring that Trump had imposed a 25% tariff on all steel and aluminum imports, without exception. Their stories tied this alleged decision directly to closures at Pohang steel plants, presenting the U.S. president as the immediate cause of Korea’s industrial decline. Yet the official U.S. proclamation established a global tariff framework subject to country-specific negotiations, with actual application to Korea still pending. In reality, Pohang’s struggles stemmed from domestic overcapacity and rising energy costs, not a tariff already enforced.

The same distortion appeared in the October announcement of a 25% tariff on imported trucks. Local press framed the measure as a direct blow to Korea. But Korea’s exports of heavy trucks to the U.S. are negligible. The tariff primarily targets Mexican, Canadian, and European imports. By exaggerating its impact, the Korean media crafted a victim narrative, positioning Korea as under siege even when the measure was structurally irrelevant.

The SPC Leak and the Narrative of Confiscation

On September 12, 2025, Channel A broadcast an “exclusive” report that the U.S. demanded South Korea create a Special Purpose Company (SPC) under U.S. jurisdiction and deposit $350 billion in cash reserves into it, with all profits sequestered in America. No U.S. or international source corroborated this. Reuters, Bloomberg, and the Financial Times consistently described the $350B as an “investment package” or “non-binding MOU,” never as a cash escrow.

Legally, an SPC is plausible: it centralizes control, isolates capital, and aligns with U.S. jurisdictional leverage. But financially, it is implausible: Korea’s reserves stand near $410B, and stripping out $350B would destabilize the won and trigger capital flight.

The leak’s purpose was domestic. It emerged after the Georgia raid, where nearly 450 workers, some of them Korean, were detained at a Hyundai–LG construction site. That raid generated nationalist anger against Washington. By portraying the U.S. as demanding a near-total confiscation of reserves, Channel A gave President Lee a shield: rejecting the deal became a patriotic act, not political weakness. What internationally was reported as “capital allocation” became domestically reframed as “capital confiscation.”

The Heroic Resistance Narrative

Two days later, on September 14, JoongAng Ilbo reported that Trade Minister Kim Jung-kwan had returned from Washington “empty-handed” after refusing U.S. demands. The framing was deliberate: Korea’s resistance was heroic, not fruitless. President Lee reinforced this image, declaring that “irrational agreements will never be signed.” Economists were quoted to support the stance, such as Dean Baker from CEPR, who argued it was absurd to hand over $350B in reserves to protect only $12.5B in exports.

But the framing ignored the sequence of events in Washington. On July 31, President Trump had already announced Korea’s $350B commitment as fact in the White House, presenting it to the U.S. public as a done deal. In Trump’s framework, the spoken word is the binding contract; paperwork is secondary. For Korea, the spoken word was still negotiable. The divergence was cultural and structural, but JoongAng’s narrative converted this into a drama of resistance, feeding a sense of sovereignty where none existed.

The Lutnick Ultimatum

On September 11, just before JoongAng’s report, U.S. Commerce Secretary Howard Lutnick stated on CNBC that unless Seoul signed an agreement “identical to Japan’s,” punitive tariffs would remain or return. The message was unmistakable: Korea’s 25% automotive tariff would not be lifted until Seoul matched Tokyo’s $550B MoU. Reuters confirmed that while Japanese autos now entered the U.S. market at 15% tariff rates, Korean cars still faced 25%. The Bank of Korea warned that maintaining tariffs could cut GDP by nearly half a percent annually.

Lutnick’s remarks shattered any illusion that Korea had space to negotiate its own framework. The U.S. position was binary: capitulate to Japan’s template, or remain under tariff siege. Yet Korean domestic reporting continued to emphasize “ongoing negotiations,” preserving the myth that Lee’s government still held leverage.

Official Admissions in Seoul

Contradictions grew visible when Korean officials themselves contradicted the press. National Security Adviser Wi Sung-lac admitted on September 27 that Korea could not possibly pay $350B in cash up front, as Trump suggested, without destabilizing the financial system. Government spokesmen stressed that the deal would have to be structured through phased loans, guarantees, and projects, not a lump sum. Some even acknowledged that parliamentary ratification might be required for legal force. By late September, Seoul itself quietly confirmed that the U.S. terms were not negotiable in principle.

At the same time, Seoul began to link the Georgia immigration raid to the negotiation stalemate, implying that American enforcement actions had poisoned the environment for investment. The implication was that the delay was America’s fault, not Korea’s. Yet Washington’s stance remained consistent: Korea had pledged, and now must deliver.

The Collapse of the Narrative

From July to October, Korea’s public narrative moved through distinct stages. In July, the government insisted the figure was only “200 + 100 under review.” By mid-September, media emphasized “heroic resistance” and painted U.S. demands as irrational or humiliating. But by October, local outlets were reporting as fact the $350B plus $100B LNG deal, exactly as Trump had framed it months earlier. The government’s denials and redefinitions collapsed under the weight of U.S. consistency.

Domestically, the strategy had short-term value. It shielded Lee Jae-myung from charges of surrender, bought time, and soothed nationalist anxieties. But the cost was steep. Once the contradiction became obvious, the government appeared dishonest at home and unreliable abroad. Internationally, Korea gained a reputation in Washington as “an ally with money but without credibility.” Domestically, opposition parties accused the Blue House of deception, eroding public trust further.

References

• Newsis (Feb 2025): coverage of “25% global tariff on all steel and aluminum.”

• Hankyoreh (Mar 2025): article declaring tariffs “apply to every country.”

• DT Korea (Mar 2025): clarification that Korea’s application was pending review.

• Channel A (Sept 12, 2025): exclusive report on $350B SPC cash demand.

• JoongAng Ilbo – Kang Tae-hwa (Sept 14, 2025): report on Kim Jung-kwan’s return and Lee’s “irrational” refusal.

• CEPR – Dean Baker: comments on the asymmetry of $350B vs. $12.5B exports.

• CNBC – Interview with Secretary Howard Lutnick (Sept 11, 2025).

• Reuters (Sept 2025): confirmation of tariff discrepancies between Korea (25%) and Japan (15%).

• Bank of Korea (Sept 2025): projections of GDP impact (−0.45% in 2025, −0.60% in 2026).

• Al Jazeera (Sept 19, 2025): coverage linking Georgia raid to negotiation climate.

• Anadolu Agency (Sept 15 & 27, 2025): admissions by Wi Sung-lac on cash impracticality and need for structured deal.

• Bloomberg, FT (July–Sept 2025): framing of $350B as investment package/MoU, not SPC cash deposit.