Shares of Hyundai Motor fell sharply after former U.S. President Donald Trump announced increased tariffs on some South Korean goods. The stock dropped as much as 5% during morning trading, extending losses after hitting record highs earlier in the month. Sister company Kia Corp also experienced a more than 3% decline. The move follows a delay in Seoul’s implementation of a recent trade agreement.

Trump stated the tariffs on South Korean imports of autos, lumber, and pharmaceuticals would increase to 25%. This decision reflects ongoing trade tensions and concerns over the pace of the trade agreement. The two companies are major exporters of South Korean vehicles to the U.S., making them particularly susceptible to import tariffs. Hyundai had previously invested in the U.S. to avoid such tariffs.

While South Korean stocks initially shrugged off early losses, Hyundai's vulnerability to profit-taking remains a concern. The gains earlier this month were spurred by optimism surrounding the company's prospects in robotics and autonomous driving. The market will be watching to see how the company responds to the increased tariffs and any potential impact on its U.S. investments.