Toyota and Honda Face Risk of 50% Trump Tariffs After US Threatens to Raise Duties on Canadian Cars

GeopoliticsMacro Impact 4
โดย InfoQuest·USCA·Read original
Summary · why it matters

Toyota and Honda, two of Japan's major automakers, may face increased costs if President Donald Trump proceeds with raising tariffs on cars imported from Canada to 50% from the current 25%. The measure could take effect on January 1st if the two nations fail to reach an agreement. Both companies have large production bases in Canada, together producing more than 75% of all cars manufactured in the country. Analysts at Barclays note that cars made in Canada, including the Toyota RAV4 and Honda CR-V, account for nearly 25% of Honda's US sales and 17% of Toyota's sales over the past year, the highest proportion among major automakers. This makes both companies the most affected by the plan to double tariffs. The cost of US tariffs resulted in Toyota incurring expenses of about 1.4 trillion yen, or 8.8 billion dollars, in the last fiscal year. The company is accelerating its expansion of production in the US and plans to invest up to 10 billion dollars over five years. Honda, meanwhile, is facing pressure from its loss-making automobile business, as Japanese automakers confront intense competition from affordable Chinese electric vehicles in key markets including Southeast Asia, Europe, and Latin America. However, the US remains the primary market for both Toyota and Honda, and it is a market where BYD has not yet been permitted to enter.

Impact on stocks 4

Electrification & Mobility▼ · 2 stocks
Toyota Motor Corp.
7203
▼ NegativeTariffrelevance

Proposed 50% US tariff on Canadian-made cars threatens Toyota, whose Canada-built vehicles are about 17% of US sales and which already bore ~$8.8B in prior US tariff costs.

Honda Motor Co., Ltd.
7267
▼ NegativeTariffrelevance

Proposed doubling of US tariffs on Canadian-made cars to 50% would hit Honda hardest, with Canada-built models like the CR-V accounting for nearly 25% of its US sales.

Financials▲ · 1 stocks
Others▲ · 1 stocks

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