Key Facts
• Japan-US tariff negotiations concluded with a 15% tariff on Japanese cars.
• Tariff reduced from 25% but may impact suppliers over the medium to long term.
• SMEs increasingly consult support agencies about cash flow issues.
• US-bound Japanese car exports declined in May, with some suppliers notified of production cuts.
• Mutual tariffs on Japanese imports to the US also reduced from 25% to 15%.
• Over 4,000 consultations recorded at 1,000 government support centers by late June.
• 30% of consultations related to cash flow, with 20% resulting in loans or guarantees.
• Government’s “Emergency Response Package” includes cash flow support for SMEs.
• Concerns persist over hollowing out of domestic industries due to production shifts.
• SMEs face challenges from rising raw material costs and reduced profitability.
Summary
The Japan-US tariff negotiations have resulted in a reduction of tariffs on Japanese cars from 25% to 15%, avoiding a worst-case scenario. However, the impact on small and medium-sized enterprises (SMEs) remains a significant concern. Suppliers face potential long-term challenges, including reduced production and cash flow issues, as US-bound car exports decline. The government has established 1,000 consultation centers nationwide, recording over 4,000 cases by late June, with 30% related to cash flow. While measures like the “Emergency Response Package” aim to support SMEs, the risk of domestic industrial hollowing out and the strain of rising raw material costs persist. Strengthened government support is critical to mitigate these challenges.
