President Donald Trump has emerged as the greatest management risk for U.S. businesses.
The business community is reeling from the recent mass detention of Koreans in Georgia, following U.S. tariff policies that have shown little regard for allied nations.
The joint battery plant of Hyundai Motor Company and LG Energy Solution, originally slated to begin operations next year, now faces inevitable delays. This setback will ripple through the supply chain, affecting production schedules for automakers relying on these batteries. In light of these developments, companies that had planned U.S. investments following tariff negotiations are now rethinking their strategies.
Major Firms Likely to Postpone U.S. Investment Plans… Resolving Visa Issues is the Top Priority
An industry insider told News1 on Tuesday that major companies will have no choice but to push back their U.S. investment timelines. Further stating that who would want to work in America after seeing employees in chains? That these visa issues primarily affect subcontractors, but the accompanying images are damaging across the board.
There is a silver lining in the swift resolution of this crisis. The roughly 300 detained Korean workers are expected to return home by the afternoon of Thursday. Korean Air is dispatching a charter flight from Incheon International Airport to Hartsfield-Jackson Atlanta International Airport on the morning of Wednesday. Meanwhile, Foreign Minister Cho Hyun is in Washington, negotiating measures to minimize re-entry penalties and establish a dedicated work visa program.
While the immediate crisis may be subsiding as our citizens return, companies with significant U.S. investment plans are now facing tough decisions on whether to proceed or pivot.
Korean firms have earmarked 150 billion USD for U.S. investments, but this incident is likely to cause delays. A prime example is the Make American Shipbuilding Great Again (MASGA) project, which depends on Korean shipbuilding experts relocating to the U.S. to train local workers. Without a resolution to the visa issues, this critical transfer of expertise faces significant hurdles.
A palpable reluctance to travel to the U.S. has spread among major companies, with many postponing all but the most essential trips. In response, industry leaders are urging the government to address the root causes of these visa issues that have led to the current detention crisis. To avoid such clampdowns, companies must navigate the complex process of securing professional (H-1B) or intra-company transfer (L1/E2) visas, which can take at least three months to process. Compounding the challenge, large-scale immigrant crackdowns and deportation operations are expanding beyond Georgia to major cities like Boston and Chicago, making it nearly impossible for companies to operate in the U.S. without a comprehensive visa solution.
Despite these challenges, companies find it difficult to completely abandon their planned investments, given the allure of the vast U.S. market. As one business source noted that it’s hard to imagine firms fully retracting their U.S. investments at this point.
Tariffs hit allies and foes alike, while subsidy promises hang in the balance.
This isn’t the first time President Trump’s actions have sent shockwaves through the business community. Since taking office, he has waged a global tariff war that has spared not even close allies like South Korea.
Although coordinated efforts by our government and the private sector have helped avert worst-case scenarios, many in the business world are left saying that this isn’t the America we thought it knew. One executive didn’t mince words that economically speaking, the U.S. is behaving no differently than North Korea. Further noting that any notion of America as a defender of international order has been completely shattered.
The semiconductor subsidy issue is another point of contention, with growing doubts about whether the previous Joe Biden administration’s promises will be honored. The U.S. government had pledged subsidies to companies investing in domestic semiconductor facilities, prompting Samsung Electronics to commit over 37 billion USD and SK Hynix to plan 3.87 billion USD in investments. However, the promised subsidies—4.75 billion USD for Samsung Electronics and 458 million USD for SK Hynix—are now in question. Even more alarming are rumors that the U.S. might demand equity stakes in exchange for these subsidies, a prospect that has sent shockwaves through the business community.
Public opinion in South Korea regarding the recent detention of its citizens in the U.S. has turned decidedly frosty. A Realmeter poll of 508 adults found that 59.2% were deeply disappointed with the Trump administration’s excessive scrutiny of foreign investors, nearly double the 30.7% who expressed understanding for the administration’s actions.