Japanese automakers warn of US tariff impact

Japan’s top automakers warned on Wednesday that they may be forced to cut production if US President Donald Trump proceeds with his planned tariffs on vehicle imports. The auto industry is a major pillar of Japan’s economy, with about 10 percent of jobs connected to the sector. Japan’s Toyota, the world’s top-selling carmaker, and other manufacturers fear the impact of US trade protectionism.

Masanori Katayama, chair of the Japan Automobile Manufacturers Association (JAMA) and CEO of Isuzu Motors, expressed concerns at a Tokyo press conference. “We are concerned that the additional 25 percent tariff on automobiles, currently being considered by the Trump administration, if applied to exporters from Japan, Mexico, and Canada, would have a negative impact overall on the economies of the United States and Japan,” he said. If imposed, he warned, “considerable production adjustments” may occur.

Vehicles accounted for roughly a third of Japan’s 21.3 trillion yen ($142 billion) in US-bound exports in 2024. Japanese automakers export approximately 1.37 million vehicles to the United States annually—down from a peak of 3.43 million in 1986. These exports, Katayama noted, are essential for offering a full range of products to American consumers.

Despite lobbying efforts, Japanese ministers have so far failed to secure tariff exemptions for key exports such as steel and vehicles. Katayama also highlighted the growing economic uncertainty, which has made investment decisions more challenging.

Stressing the broader economic ties between the two countries, Katayama pointed out that Japanese automakers have created jobs in the US and function as members of corporate America. JAMA, which represents Japan’s 14 leading automakers and motorcycle producers, continues to advocate for policies that support stable trade relations.