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Trump wants a trade deal, but South Korea doesn't want US cars

SEOUL - US auto imports from the likes of General Motors and Ford must become more chic, affordable or fuel-efficient to reap the rewards of President Donald Trump's attempts to renegotiate a trade deal with key ally South Korea, officials and industry experts in Seoul say. Meeting South Korean President Moon Jae-in last week in Washington, Trump said the United States would do more to address trade imbalances with South Korea and create "a fair shake" to sell more cars there, the world's 11th largest auto market. "What we really want to say to the United States is: Make good cars, make cars that Korean consumers like." While imports from automakers including Ford, Chrysler and GM more than doubled last year largely thanks to free trade deal which took effect in 2012, sales account for just 1 percent of a market dominated by more affordable models from local giants Hyundai and affiliate Kia. Imports make up just 15 percent of the overall Korean auto market, and are mainly more luxurious models from German automakers BMW and Daimler AG's Mercedes-Benz, which also benefit from a trade deal with the European Union. "Addressing non-tariff barriers would not fundamentally raise the competitiveness of US cars," a senior Korean government official told Reuters, declining to be identified because of the sensitivity of the subject. "What we really want to say to the United States is: Make good cars, make cars that Korean consumers like." TASTE BARRIER In Korea, US imports are seen as lagging German brands in brand image, sophistication and fuel economy, industry experts say. US imports do have a competitive advantage in electric cars: Tesla Motors' electric vehicles are seen as both environmentally friendly and trendy, while GM has launched a long-range Bolt EV. US Commerce Secretary Wilbur Ross had cited a quota in the current trade deal as an obstacle to boosting imports. The quota allows US automakers to bring in each year 25,000 vehicles that meet US, not necessarily Korean, safety standards. Should GM, for example, decide to bring in more than its quota of one model - the Impala sedans - it would cost up to $75 million to modify the cars to meet Korean safety standards, the company told its local labor union. Asked about non-tariff barriers, a spokesman at GM's Korean unit said removing them could expand the range of models the company can bring in from the United States. No US company, however, has yet to make full use of the quota, industry data shows.

Hyundai returns to flashier design with 2018 Sonata

Compared to the stylistic achievement of the 2009 Hyundai Sonata, many observers viewed the redesigned 2015 Sonata as a step backward. To right the ship, Hyundai tasked its North American Design Center with restoring some razzle-dazzle to the brand's midsize contender for 2018. The creative team made changes throughout, the biggest development being the "cascading grille" at the front, cribbed from the Elantra. The Sonata Sport 2.0T grille gets a silver mesh treatment and vertical LED DRLs tucked in the triangular bumper vents at the corners. The other models wear chrome bars inside the grille, with vertical and horizontal LED DRLs at the corners. Slimmer headlights stretch around the front edges, with the hood sporting deeper chiseled surfaces to emphasize the injection of style. In back, instead of the hint of a spoiler on the current sedan, the 2018 Sonata's deck lid ends in a pronounced flick above a sharp taper into the rear valance. The license-plate holder moves down to the reshaped bumper so that the larger, flatter trunk face can fit much larger badging. The trunk release button hides inside the Flying H emblem, and wedge-shaped taillights glow with the same alien-script pattern familiar from the Elantra. Down below, non-Sport models get a single, trapezoidal exhaust tip, but the Sport 2.0T gets two such exhaust tips, paired with new Michelin tires and a flat-bottomed steering wheel. Engines don't change, but buyers who choose the 2.0-liter four-cylinder get an eight-speed automatic transmission that adds a cog at the low end and another at the high end. The rest of the lineup sticks with the present six-speed auto. Handling upgrades include 12-percent thicker torsion bars in the steering system and new steering calibration for better on-center feel and responsiveness, plus 21-percent thicker trailing arms and new bushings in the suspension for faster response and more compliance. Inside, a reworked center console holds steady with a seven-inch touchscreen. Interior designers gave the new HVAC and audio controls a silkier finish and contrasting "piano key" buttons. A second-row USB port serves back-seaters, and the options list will include a Qi wireless charging pad for those in front. The 2018 Sonata introduces a navigation bird's-eye view, free traffic data, standard blind-spot detection and rear cross-traffic alert, and a new lane departure warning system as some of the convenience and safety highlights.

Trump encouraged by talk of 'a level playing field' on trade with South Korea

South Korea is a longstanding American ally, but President Donald Trump has spoken harshly about U.S. trade imbalances and threatened to tear up the bilateral trade pact. "We will do more to remove barriers to reciprocal trade and market access," Trump said, adding that the two leaders had talked about the thorny trade areas of steel and autos. Trump said he was encouraged by South Korea's President Moon Jae-in's assurances that he would seek a level playing field for American workers and businesses, particularly automakers. A joint statement said the two sides had agreed to work together to reduce over supply of basic materials such as steel and non-tariff barriers. It also said Trump had accepted an invitation from Moon to visit South Korea this year. Bonnie Glaser, senior adviser for Asia at the Center for Strategic and International Studies think tank, said it was unwise for Trump to air the trade issue so publicly. "Public complaints by Trump about unfair trade and inadequate defense spending provide opportunities for China and North Korea to drive a wedge between the allies," she said. The U.S. goods trade deficit with South Korea has more than doubled since the U.S.-Korea free trade pact known as KORUS took effect in 2012. The agreement was forecast to boost U.S. exports by $10 billion a year, but in 2016 they were $3 billion lower than in 2011. At the start of Friday's talks, U.S. Commerce Secretary Wilbur Ross said the largest component of the deficit was automotive trade and many non-tariff barriers to U.S. auto exports to South Korea remained. "I think the way to address it is to deal product by product with what we can do to change the export side and what we can do to reduce the bad imports side," he said. Ross said later on Friday that some progress had been made in the talks. The current pact was agreed to despite protests by supporters of Moon, who was then in opposition. But analysts have suggested that given the need to preserve a unified front in the face of a hostile North Korea, there could be compromise on both sides to resolve issues. (By David Brunnstrom and Lisa Lambert. Additional reporting by Fatima Bhojani, Roberta Rampton, Tim Ahmann, David Chance, David Lawder and Eric Beech; Editing by Bill Trott and Andrew Hay) Related Video: Image Credit: Kim Hong-Ji / Reuters Government/Legal Genesis Hyundai Kia trade