Free trade deal to cut prices of US-made cars in Korea

The prices of imported cars in Korea are falling ahead of the effectuation of the Korea-U.S. free trade agreement on March 15.

GM Korea, the importer of Cadillacs, announced Friday that it will cut the prices of all models 1 million to 4 million won (887 to 3,548 U.S. dollars). The effectuation of the accord will halve tariffs on imported cars from 8 percent to 4 percent, likely resulting in a price cut of 2-3 percent.

GM Korea said, “We have reflected the fall in tariffs stemming from the effectuation of the Korea-U.S. free trade agreement in the prices of our cars, and the price cut will be effective from Friday.”

The price of the CTI 3.0 Luxury, the company`s bestselling model, will be cut 1 million won to sell for 46.8 million won (41,510 dollars). Chrysler and Ford had reduced prices 2-3 percent from December last year.

Other imported car brands whose plants are based in the U.S. will likely follow suit. BMW has reportedly set the prices of the X Series made in the U.S. when the accord takes effect. Mercedes-Benz will also do the same for the prices of the M-Class imported from the U.S.

alwaysj@donga.com