U.S. Tariff on Cars Should Be Reduced Before Schedule, Suggests Akazawa
The U.S. and Japan have agreed to reduce tariffs on vehicles and auto parts imported from Japan, as well as other Japanese imports, marking a significant development in their ongoing tariff discussions. The new tariff rate, set at 15%, is a reciprocal aspect of the trade deal signed last month.
Under the agreement, Japanese automobile exports to the U.S. are subject to a reduced tariff rate of 15%, down from the previously threatened 25% tariff rate. This tariff reduction is part of the broader trade deal between the U.S. and Japan, which also includes Japan committing $550 billion in investments in the U.S.
The executive order and trade deal were announced in late July 2025. However, as of mid-August 2025, the U.S. administration is reportedly slow-walking the implementation of promised tariff cuts on autos from Japan (and the EU and South Korea), suggesting some delay or gradual enforcement is occurring. According to tariff tracking data from August 15, 2025, the reciprocal tariff rate for Japan is listed as 15%, effective July 31, 2025.
Japanese Economic Revitalization Minister Ryosei Akazawa, as the chief negotiator for tariff talks with the U.S., asked the U.S. side to issue an executive order at an early date to cut the tariff as agreed under the deal. Akazawa urged this swift action during a meeting with U.S. Commerce Secretary Howard Lutnick in Washington on August 6.
The statement from the Japanese government emphasizes the importance of the Japan-U.S. agreement, confirming the importance of working to benefit both countries under the deal. The U.S. agreed to lower its levy on vehicles and auto parts imported from Japan to 15% from 27.5%, a significant concession.
Broader market access improvements include approval of U.S. automotive standards in Japan and removal of long-standing market barriers. These improvements are intended to benefit both countries and strengthen the economic relationship between the U.S. and Japan.
[1] https://www.bloomberg.com/news/articles/2025-07-23/u-s-japan-agree-to-slash-tariffs-on-cars-in-trade-deal [2] https://www.nytimes.com/2025/07/23/business/japan-us-trade-deal.html [3] https://www.cnbc.com/2025/07/23/us-japan-trade-deal-agreement-includes-cars-and-agriculture.html [4] https://www.reuters.com/article/us-usa-japan-trade-idUSKCN25O14Q [5] https://ustr.gov/sites/default/files/files/Press/Releases/2025/07/23/Fact-Sheet-U.S.-Japan-Trade-Agreement-July-2025.pdf
- The reduction in tariffs on vehicles and auto parts imported from Japan, along with other investments, signifies a shift towards benefiting both countries in the art and finance sectors, as Japan has committed $550 billion in investments in the U.S.
- The photography industry, aware of the new tariff deal, awaits any potential changes to import duties from Japan, as the U.S. agreed to lower its levy on vehicles and auto parts, including those used in photographic equipment, to 15% from 27.5%.
- With the reciprocal tariff rate for Japan listed as 15%, effective from July 31, 2025, the transportation industry, particularly the automotive sector, braces for potential growth opportunities and increased prosperity in the sector, benefiting from broader market access improvements.
