Trump Cuts Tariff on Japanese Cars to 15%

U.S. President Donald Trump on Thursday signed an executive order reducing tariffs on Japanese car imports from 27.5% to 15%, a move expected to ease pressure on global auto giants such as Toyota, Honda, and Nissan.

The order formalises a landmark trade agreement first announced in July, under which nearly all Japanese exports to the U.S.including vehicles and pharmaceuticalswill now be subject to a uniform 15% levy.

In exchange, Tokyo has pledged to invest $550 billion (£410 billion) in U.S. projects and to further open its market to American products, including cars and rice. Japan also committed to purchasing $8 billion worth of U.S. goods annually, covering agricultural produce, fertilisers, and bioethanol. Notably, Japan will boost imports of U.S.-grown rice by 75%, signalling a significant shift in its traditionally protected agricultural sector.

Trump hailed the agreement as “massive” when it was first announced, describing it as a “win-win” for both nations.

Ryosei Akazawa, Japan’s chief trade negotiator, responded with a single word“Finally”as he shared the White House announcement.

Automobiles remain central to Japan’s export-driven economy, representing about 20% of total exports, with the U.S. as its biggest market. Last month, Toyota warned that Washington’s previous tariff regime could cost it $10 billion this year, underscoring the stakes of the deal.

The agreement, reached after months of tough negotiations following Trump’s sweeping global tariff hikes in April, highlights the strategic importance of U.S.-Japan trade ties amid ongoing turbulence in global markets.

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