Japan's Nikkei 225 index opened 3.2% higher on 23/7, while the Topix index rose 3.1%. The positive start followed US President Donald Trump's announcement of a trade agreement with Japan on 22/7.
Shares of Japanese automakers soared after NHK reported that US import tariffs on Japanese cars would be lowered from 25% to 15%. Honda's stock surged over 10%, Mitsubishi Motors climbed 13%, and Nissan increased by nearly 9%. Mazda Motor and Toyota led the gains, with increases of 17% and 13.6%, respectively.
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Japanese cars at the Port of Richmond (California, USA). Photo: Reuters |
Japanese cars at the Port of Richmond (California, USA). Photo: Reuters
President Trump had previously imposed a 25% tariff on all imported cars, effective 2/4. The automotive industry is a cornerstone of Japan's economy, contributing 28.3% of its exports to the US in 2024, according to customs data.
Recent figures reveal the impact of these tariffs on Japanese car exports to the US. In June, car exports dropped almost 27% compared to the same period last year, following a 24.7% decrease the previous month.
Ed Rogers, CEO of Rogers Investment Advisors, called the tariff reduction "very good news" for Japanese automakers. However, the industry still faces challenges, including competition from Chinese and South Korean rivals.
"Nevertheless, this provides much-needed short-term assurance that US tariffs remain manageable," he commented.
On 22/7, President Trump announced on Truth Social that he had reached "the biggest deal in history" with Japan. The new reciprocal tariffs would be set at 15%, although tariffs on aluminum and steel would remain at 50%.
Japan will invest $550 billion in the US, with Trump claiming that Washington will receive "90% of the profits" from these investments. He stated that Japan "will fully open its markets to US cars, trucks, rice, certain agricultural products, and many other goods." Trump expressed enthusiasm for the deal's potential to create "hundreds of thousands of jobs" in the US.
Ha Thu (via Reuters, CNBC)
