SEOUL (Reuters) -South Korea’s Samsung SDI (KS:006400) on Friday said U.S. tariffs will increase the cost of producing its electric vehicle (EV) batteries in the United States, as many materials and components required for it are imported.
"While the production of EV batteries takes place in the United States, there is no direct tariff impact. However, many materials and components are imported from outside the U.S., which is expected to increase cost burdens," Executive Vice President Kim Yoon-tae said in the company’s first-quarter earnings conference call.
EVs produced by automaker customers in Mexico and Canada could also be subject to tariffs, potentially leading to higher vehicle prices and lower demand, Kim added.
Kim did not elaborate on whether the company would absorb the costs or pass it on to consumers.
Kim said that tariffs will serve as a burden on the company’s performance, adding that Samsung SDI will continue to closely monitor developments related to tariff policy and work with customers to mitigate the impact.
The South Korean battery maker, whose customers include BMW (ETR:BMWG), Rivian (NASDAQ:RIVN), General Motors (NYSE:GM) and Stellantis (NYSE:STLA) among others, have production sites in the U.S., South Korea, Hungary and China.