I can’t say I saw this one coming, but recent reports suggest Toyota is willing to allow U.S. automakers to utilize its JDM dealer network to sell their vehicles. Don’t worry, I’m as confused as you are because this is definitely taking the “keep your enemies closer” proverb to another level. Make it make sense, you ask? Due to tariffs, Toyota is apparently considering every option to appease the U.S.
In 2024, the U.S. goods trade deficit with Japan was $68.5 billion, which was actually a 4.3 percent decrease from the previous year. However, with new U.S. tariffs imposed in April, global trade has been, to put it lightly, shook. Most nations received a 10 percent increase, but countries with which the U.S. has large trade deficits received higher increases. The Mainichi, a long-running English-language Japanese daily, reports:
“…nearly every nation in the world has been hit with a baseline duty of 10 percent, with Japan facing an additional country-specific tariff of 14 percent for a total rate of 24 percent.
Japan, meanwhile, has been affected by Trump’s extra 25 percent tariff on automobiles, along with other sector-specific levies imposed on national security grounds.”
That extra tax on autos and parts is the tasteless icing on the stale cake — no Japanese OEM wants that. Automotive retail news outlet CBT News said that Japanese automakers are expecting fiscal year losses in the billions, directly due to the tariffs.
“Japan’s auto industry is facing mounting pressure from a 25 percent U.S. tariff on vehicles and parts, a sector that accounts for 10 percent of the nation’s GDP and supports approximately 5.6 million jobs. Major automakers, including Toyota, Honda, Mazda, and Subaru, are bracing for a collective $19 billion loss this fiscal year due to the tariffs.”
So, time for trade negotiations and deal-making.
According to The Mainichi, in a corporate video released by Toyota, Chairman Akio Toyoda shared with Prime Minister Shigeru Ishiba that the company wasn’t opposed to letting the likes of Ford, GM, and Stellantis sell their wares in a local Toyota dealership. Another option on the table was reverse importing U.S.-built Japanese cars. The conversation occurred in May, during which Toyota’s Chief Technology Officer, Hiroki Nakajima, was also in attendance.
Per Bloomberg Nakajima said that U.S. car brands have 163 sales locations in Japan, but Toyota alone has more than 4,000 sites.
“‘When US manufacturers bring cars to Japan, for example, using Toyota’s sales network to deliver them is an option,’ Nakajima said.”
This, of course, is to be taken with a Himalayan-sized grain of salt. Added Nakajima, “…They didn’t say they would, only that it should be seen as an option.”
And it’s a crazy option to essentially let a competitor encroach not just on your home turf, but in your actual home. This could set a precedent. Stateside, dealer groups franchising competing marques isn’t uncommon, but they never sell them under the same roof. Maybe the same street or block.Â
How and where would Toyota dealers display their American rivals? Or would Toyota only allow U.S. brand models it has no direct market competitor, like a Ford Maverick? Toyota currently offers a compact pickup, but not a hybrid variant. What if Chevrolet sells more than Toyota that month? Will there be profit sharing? Will Toyota charge rent??
There are so many questions with no answers. Right now, the only certainty is that further trade negotiations between Japan and the U.S. will continue.
I think the key word in all of this is that American companies may get the chance to TRY to sell cars in Toyota dealerships, but based on years of failing to gain any kind of foothold in Japan I’m pretty sure JDM manufacturers don’t have much to worry about. Different tastes in different markets with not much overlap. I’m almost certain that even Our Lord and Savior DJT (barf) can’t convince Japanese consumers to buy F-150’s.