U.S. automakers criticize Japan trade deal, raising concerns that it puts them at a disadvantage. They argue Trump’s tariff agreement favors Japanese exporters while hurting American manufacturers.
President Trump announced the deal Tuesday, lowering tariffs on Japanese vehicles from 25% to 15%. He framed the agreement as a win for U.S. jobs and trade fairness.
However, the American Automotive Policy Council voiced alarm. “This deal charges lower tariffs on Japanese autos with no U.S. content,” said President Matt Blunt. He warned that American companies face 50% tariffs on steel and aluminum, plus 25% on parts.
Blunt explained that only products covered under the U.S.-Mexico-Canada Agreement (USMCA) escape some tariffs. For most U.S. automakers, this creates a significant cost burden.
U.S. automakers criticize Japan trade deal because it could give Japan a cost advantage in the U.S. market. Auto experts warn the policy shift may backfire politically, especially in swing states like Michigan and Wisconsin.
Trump said the deal includes a $550 billion investment from Japan into U.S. projects, directed by the president himself. He claimed the deal would “create hundreds of thousands of jobs.”
The White House also stated that Japan will lift regulations blocking American cars. U.S. vehicles could now be shipped directly to Japan, ready for sale.
Still, Blunt remained skeptical. Foreign automakers hold just 6% of the Japanese market. “I’d be surprised if we see meaningful U.S. market penetration in Japan,” he said.
When asked if Trump might change other sectoral tariffs, Press Secretary Karoline Leavitt said the Commerce Department is reviewing those matters.
Analysts see Japan’s willingness to accept a flat 15% tariff as a move toward stability. Countries may prefer fixed tariffs over unpredictable swings. That, however, gives Japan and Britain an edge over others.
“This deal gives Japan a near-term cost advantage,” said Karl Brauer of iSeeCars. “It could lead other countries to seek similar agreements.”
U.S. automakers criticize Japan trade deal while foreign automakers welcome it. Autos Drive America praised the agreement and urged similar pacts with the EU, Canada, and South Korea.
AutoForecast Solutions Vice President Sam Fiorani said U.S. brands have reason to be frustrated. Yet, many Japanese automakers already build popular models in North America.
“Brands like Honda and Toyota produce most high-volume models here,” Fiorani said. “Only niche imports still come from Japan.”
He expects future tariff talks with Canada and Mexico, likely capping duties at 15%. For now, domestic carmakers must navigate a complex and uneven playing field.
