Japan considers "all options" in response to US 25% tariff on car imports

Japanese Prime Minister Shigeru Ishiba announced today that Japan is prepared to consider "all options on the table" in response to the U.S. decision to impose a 25% tariff on imported cars and light trucks, a move set to take effect next week.

On March 26, U.S. President Donald Trump unveiled the tariff, further escalating the global trade tensions that have intensified since his return to the White House earlier this year, Caliber.Az reports via foreign media.

"Japan is a country that is making the largest amount of investment to the United States, so we wonder if it makes sense for (Washington) to apply uniform tariffs to all countries. That is a point we've been making and will continue to do so," Ishiba told parliament.

In his statement, Ishiba emphasized Japan's commitment to protecting its national interest. "We need to consider what's best for Japan's national interest. We're putting all options on the table in considering the most effective response," he said, although he refrained from specifying the steps Japan might take in retaliation.

The tariff announcement has raised concerns that it could severely impact Japan's economy, particularly given the country's reliance on automobile exports to the United States. In early trading on March 27, shares in Japanese automakers saw a significant decline.

According to data from Japan's Ministry of Finance, automobiles accounted for 28.3% of Japan’s total exports to the United States in 2024, the largest proportion of any export category. The auto industry also plays a crucial role in Japan’s economy, contributing approximately 3% to the nation's GDP and driving recent wage increases as profits from foreign sales are shared with employees.

Takahide Kiuchi, an executive economist at Nomura Research Institute (NRI), warned that the increased tariffs could have a damaging impact on Japan's economy. "The Trump tariff has the potential to immediately push Japan's economy into deterioration," Kiuchi said, estimating that the move could reduce Japan's GDP by around 0.2%.

By Vugar Khalilov