TOKYO – Japan has pledged to take “all necessary measures” after receiving an official letter from former President Donald Trump’s campaign threatening 25% across-the-board tariffs on Japanese automobiles and electronics if he wins November’s election. The warning specifically targets Japan’s $150 billion auto export industry to the United States.
Prime Minister Fumio Kishida expressed “deep regret” over the ultimatum during an emergency cabinet meeting, stating: “Japan will stand firm in protecting our economic interests.
Such unilateral measures would damage both economies and disrupt global supply chains.” The letter, confirmed by Japan’s Foreign Ministry, argued that Japanese carmakers “unfairly dominate” the U.S. market.
Immediate Fallout:
- Stock Plunge: Toyota (-7.2%), Honda (-6.8%), and Nissan (-8.1%) shares tumbled on Tokyo Exchange
- Retaliation Plans: Japan considering WTO challenge and adjustments to $200 billion U.S. treasury holdings
- Industry Alarm: Auto sector warns 380,000 U.S. dealership jobs at risk from price hikes
“These tariffs would destroy our business model,” Honda CEO Toshihiro Mibe stated. “A 25% duty on a $25,000 Civic would force $6,250 price increases onto American workers.”
Japan’s Counter-Strategy:
- Diplomatic Offensive: Urgent talks with Biden administration to reaffirm existing trade agreements
- Supply Chain Shift: Accelerating EV battery production in Ohio-based plants to bypass “import” classification
- Retaliatory Tariffs: Drafting levies on U.S. agricultural exports (beef, corn, LNG)
- ASEAN Alignment: Coordinating with Thailand and Vietnam on regional component sourcing
The threat comes despite Japan’s $55 billion in U.S. manufacturing investments since 2020. Trump’s policy director Peter Navarro defended the proposal: “Japan’s 70% market share in key auto segments is unsustainable.”
With 78% of Japan’s $210 billion U.S. exports at risk, analysts warn the move could trigger Asia’s largest trade realignment since the 1980s. The Kishida administration will present formal counterproposals to both U.S. political campaigns by July 25.
