TOKYO – The tariffs on automobile imports announced by U.S. President Donald Trump on Friday did not specify such details as which countries would be targeted and what the rate of the tariffs would be. If Japan is subject to the automobile tariffs, it could deal a blow to the entire Japanese economy.

The performance of many Japanese automakers, including Toyota Motor Corp., hinges on sales in the United States, the world’s second largest automotive market.

Toyota sold about 10.15 million vehicles worldwide last year. About 2.33 million vehicles, or over 20%, were sold in the United States, including about 530,000 exported from Japan.

Mazda Motor Corp. sold about 420,000 vehicles in the United States in the same year, and more than half, or about 230,000 vehicles, were exported from Japan.

According to the Finance Ministry’s trade statistics, Japan exported a total of 1.37 million vehicles, worth over \6 trillion, to the United States in that year.

If the United States imposes a tariff on cars imported from Japan, one of the main ways Japanese carmakers could avoid them is by increasing production at plants in the United States. However, it would not be easy.

“It’s difficult to boost production capacity in the short term,” said a source close to Toyota. “Once tariffs are imposed, there will be no other choice but to raise car prices.”

Mitsubishi Motors Corp., which has no car manufacturing plant in the United States, will have limited options.

Honda Motor Co. said on Thursday that if the series of tariffs that the United States is considering imposing on Mexican and Canadian imports go into effect, the company will lose more than ¥700 billion.

A downturn in performance for carmakers would affect their business partners, such as auto parts manufacturers.

“We want the government to negotiate [with the United States] to minimize the potential burden as much as possible,” said a source close to a major automaker on Saturday.

The Japanese government asked the U.S. government on Wednesday to exclude Japan from 25% steel and aluminum tariffs. As for tariffs on car imports, the government is set to take steps while closely monitoring U.S. moves, as the measure would significantly impact Japanese automakers.

“We are yet to know exactly what the [tariff] rate will be and which countries will be subject to it, so we will consider how to respond accordingly after finding out more details,” said a Japanese government source.

A senior official of the Economy, Trade and Industry Ministry is wary of the move. “Among the Trump administration’s tariff policies, our biggest fear is that the auto industry may be targeted,” the official said. “It could significantly impact Japanese manufacturers’ production plans and other areas.”

Asia News Network/The Japan News