Japan wary of possible low-tariff auto quota in US trade talks
Japanese government officials are alarmed by an agreement between Washington and London to set a low-tariff quota for British vehicle exports to the United States.
Japan is evaluating the agreement as it has been asking the United States to remove its 25 % auto levies as part of tariff relief talks between Tokyo and Washington.
The United States agreed to lower its levies on imports of British vehicles to 10 % from the current 27.5 % for up to 100,000 units per year, roughly equivalent to Britain's total auto exports to the United States last year.
"It's not appropriate to apply the case of Britain, which exports a smaller amount of vehicles, to Japan," a senior official at the Japanese industry ministry said. "We don't want to rush to make Britain a model," a senior official at a Japanese government economic agency said.
The United States is an important market for the Japanese automobile industry, accounting for about 20 % of its total car exports in terms of volume and about 30 % in terms of value.
On Thursday, Toyota Motor Corp. said that its operating profit is estimated to decrease by 180 billion yen in April and May alone due to the US tariffs.
"Japanese companies are losing money day by day," said Japanese economic revitalisation minister Ryosei Akazawa, the country's chief negotiator in the tariffs talks with the United States.
Some Japanese government officials are calling for compromises. "It's one idea to create a low-tariff import quota rather than leaving high tariffs unchanged," said a senior official at another Japanese government economic agency.
But a Japanese government official said, "It'll be difficult to secure a quota acceptable to Japan" even if the two sides agree to discuss an auto import quota.
[Copyright The Jiji Press, Ltd.]
Photo by Reuters
