Japan's US exports slide 14% as Trump tariffs hit auto sector

Japan’s exports to the United States tumbled nearly 14 percent in August, dragged down by a steep decline in auto shipments as US President Donald Trump’s tariffs continued to disrupt trade flows.

Finance ministry data released Wednesday showed overall exports to the US fell 13.8 percent year-on-year, the sharpest drop in more than four years, according to Bloomberg. Auto exports plunged 28.4 percent, while shipments of auto parts slipped 7.1 percent.

The auto sector — which makes up about one-third of Japan’s exports to its largest trading partner — has been under pressure from a 27.5 percent levy imposed earlier this year as part of Trump’s sweeping tariff regime.

The tariffs have battered Japan’s industrial base, even as a new trade deal came into effect Tuesday, reducing the US tariff on Japanese autos to 15 percent, in line with other goods. While the lower duty is seen as a relief, analysts warn the elevated costs will continue to weigh heavily on manufacturers including Toyota and Honda.

Japan’s powerful business lobbies are urging Tokyo to push ahead with further negotiations to ease the tariff burden, as Trump presses on with a global protectionist agenda aimed at narrowing the US trade deficit.

Despite the pain, the latest data also showed Japan’s trade surplus with Washington halved in August to 324 billion yen ($2.21 billion), a development Trump has long sought, frequently criticising Tokyo for its export advantage.

The automobile industry is particularly vulnerable, employing around 8 percent of Japan’s workforce and serving as a pillar of the economy. Continued pressure from US tariffs risks undermining growth in a sector critical to both trade and jobs.