[Trump's Blade] K-Industry at a Crossroads…Secondary Batteries and Steel 'Uncertain' vs. Shipbuilding and Power 'Bright'

President Donald Trump has begun his second term. As a result, the tariff hikes and protectionist policies that the Trump 2.0 administration had previously warned about are expected to impact the entire domestic industry. While some sectors are expressing concerns and tension due to the uncertainty surrounding Trump's return to power, there are also voices expecting potential benefits. According to industry sources on the 21st, with U.S. President Donald Trump officially inaugurated as the 47th president on the 20th (local time), domestic companies highly dependent on exports to the U.S. are facing heightened concerns. During his inauguration speech, President Trump had indicated trade policy reforms through the imposition of tariffs. Given this situation, there is widespread belief that domestic industries heavily reliant on the U.S. market will find it difficult to avoid the impact. ◆ Growing Tension in Secondary Battery and Steel Industries Amid Uncertainty in U.S. Exports The industry most focused on the Trump risk is the secondary battery sector. In his inaugural speech, President Trump stated, "We will end the Green New Deal and revoke the mandate for electric vehicles to revive the automotive industry and honor a sacred pledge to the great American auto workers." The Green New Deal refers to the Biden administration's policy for environmentally sustainable economic growth. Nevertheless, the industry believes that President Trump's statement about "ending the Green New Deal" does not necessarily imply the repeal of the U.S. IRA (Inflation Reduction Act). Repealing or modifying the IRA would not be possible through an executive order alone, and would require a process involving agreement and voting in both the House and Senate. Considering the differences in the number of seats in the House, analysts believe that such a move is unlikely to be realistic. Therefore, it is argued that assuming the repeal of the IRA based solely on the phrase "ending the Green New Deal" is an overstatement. However, a gradual reduction in electric vehicle subsidies is considered inevitable. There is increasing concern that this could negatively impact the profitability of domestic battery companies such as LG Energy Solution, Samsung SDI, and SK On, which have been increasing investments, including establishing local factories in the U.S. The Korea Institute for Industrial Economics and Trade predicts that battery exports could decline by 6.1% to 25.2% following the start of the Trump 2.0 administration. The steel industry is also closely monitoring the potential introduction of universal tariffs and carbon taxes. President Trump has made it clear that he intends to impose up to a 60% tariff on Chinese products, signaling his firm stance on containing China. The problem is that South Korean steel products, due to the carbon-intensive nature of the industry, will likely be affected by carbon taxes as well. Steel companies are expressing concerns about additional cost burdens and the potential weakening of export competitiveness. Currently, the U.S. applies a quota system to South Korean steel products. Under the Trump 1.0 administration, the quota system limited the amount of steel imported from South Korea, allowing domestic companies to benefit from duty-free access for 2.63 million tons of steel. However, if carbon taxes are applied to the limited export volume, the cost of the finished products would rise, making it difficult to maintain price competitiveness in the U.S. market. ◆ Shipbuilding and Power Industries Find 'Growth Drivers' in Trump's Re-election On the other hand, there are industries that are welcoming President Trump's re-election. Notably, the shipbuilding industry is expected to benefit from a double boost, with increased demand for eco-friendly ships and President Trump's cooperation requests further enhancing the outlook. In his inaugural speech, President Trump emphasized, "We will declare a national energy emergency and expand oil and natural gas drilling extensively." Additionally, in a phone call with President Yoon Suk-yeol in November 2024, he mentioned, "The U.S. shipbuilding industry needs South Korea's help and cooperation." Last month, President Trump also stated, "I am well aware of South Korea's world-class capabilities in building warships and vessels," adding, "I believe close cooperation with South Korea is necessary not only in ship exports but also in the areas of maintenance, repair, and servicing." Especially as President Trump places emphasis on traditional energy and fossil fuel-based industries, the demand for liquefied natural gas (LNG) and LPG carriers is expected to increase. Domestic shipbuilding companies such as HD Hyundai Shipbuilding & Marine Engineering, Hanwha Ocean, and Samsung Heavy Industries possess the technical capabilities to build around 80% of the world's LNG carriers, and are expected to strengthen their market position in the LNG carrier construction sector. Power equipment companies are also among the industries expecting to benefit from Trump's re-election. This is because President Trump's return to power has accelerated the replacement of power demand in the North American region. President Trump stated, "I will invoke emergency powers to secure the electricity needed for industrial development." Additionally, the day before his inauguration, President Trump stated, "I will use emergency powers to allow wealthy companies and individuals to build large factories and AI factories," and added, "We need twice as much energy, and perhaps even more." As the need for expanding the power grid grows, driven by the strengthening of the AI industry's foundation, U.S. power demand is rapidly increasing. In fact, the U.S. import value of power equipment rose significantly, from $164.34 million in January 2024 to $333.18 million in November of the same year. South Korea ranks as the second-largest importer, accounting for 12% of the total import value, and the overall trend is on the rise. Additionally, the increasing need for power equipment in the process of integrating renewable energy sources into the power grid is a positive factor for the industry. Furthermore, as the U.S. replaces its aging power infrastructure, there is rising demand for transformers, which is expected to benefit the power equipment sector. An industry insider stated, "The concerns over the tariff wars due to President Trump's re-election and the U.S.-China conflict are intertwined, meaning that the entire domestic industry will inevitably be significantly impacted." They continued, "In particular, in response to the changing global economic environment, domestic companies are adopting various strategies such as supply chain restructuring and expanding new businesses, but it is expected that, in the short term, it will be difficult to avoid overall confusion in the industry." ChatGPT를 사용하여 번역한 기사입니다.