Azernews.Az

By Alimat Aliyeva

The US imposition of additional 25 percent duties on products imported from Canada and Mexico starting March 4 will also affect Japanese automakers, Azernews reports.

The tariffs will apply to cars manufactured by Japanese companies in Canada and Mexico. The Japan Foreign Trade Organization (JETRO) predicts that the decision to impose tariffs will significantly impact the production and sales of these companies, as well as small and medium-sized enterprises in the supply chain. This is particularly concerning since a large portion of the cars produced at Nissan, Toyota, Mazda, and Honda plants in Mexico and Canada are exported to the United States. Japanese media reports that companies are now seeking solutions, with some considering exporting auto parts to the US and completing the final assembly process there.

According to JETRO, Nissan exported 40 percent of the 615,000 vehicles it produced in Mexico to the United States in 2023, while Toyota exported 90 percent of its 250,000 vehicles. Mazda and Honda sold 50 and 80 percent of their products in the US, respectively.

The US tariff policy also poses a threat to the future plans of Japanese companies. For instance, Asahi Kasei, in partnership with Honda, planned to open a plant in Canada to produce lithium batteries for electric vehicles. This plan may now be jeopardized by the new tariffs.

President Donald Trump’s tariff plan threatens to disrupt $40 billion worth of auto exports from Japan to the United States. Automobiles account for about 25 percent of Japan's exports to the US. In response, Japanese companies have urged their government to put pressure on the Trump administration. Katayama Masanori, Chairman of the Japan Automobile Manufacturers Association, met with Japan's Minister of Economy, Trade, and Industry, Muto Yoji, to discuss the issue. Katayama warned that the 25 percent duties would not only harm the Japanese economy but could also have negative consequences for the United States.

This move is part of a broader trend where tariffs and trade policies are becoming increasingly influential in shaping the global automotive industry. Japanese automakers, known for their global production networks, are particularly vulnerable due to their reliance on exports from North America. This situation highlights the growing complexity of international trade and the potential ripple effects that tariff policies can have on manufacturers, workers, and consumers alike.