• Investing
  • Stock
  • Economy
  • Editor’s Pick
Portfolio Performance Today
Stock

US-Japan trade deal boosts European automaker stocks; Porsche, BMW gain

by July 23, 2025
by July 23, 2025

Shares in several major European carmakers rose in early trading on Wednesday, catching a tailwind from a steep rally among their Asian rivals.

This wave of optimism was sparked by the news that Japan has struck a significant trade deal with the United States, a development that is now fueling hopes for a similar, much-needed agreement between Europe and Washington.

A ripple effect across the globe: auto stocks rally on tariff relief

The positive momentum for European auto stocks followed a surge in the shares of Japanese and South Korean automakers overnight.

This rally was a direct reaction to the news that the new US-Japan trade deal would cut the US tariff on Japanese vehicle imports to 15%, a significant reduction from a previously proposed 25%.

In response, shares of Porsche, BMW, Mercedes Benz, and Volkswagen rose between 1.9% and 3.7% in early Frankfurt trade. On the Tradegate platform, shares in Stellantis and Renault also saw gains, rising between 1.3% and 1.9%.

Analysts at Citi noted a particularly important detail of the US-Japan pact: the tariff for a major auto exporting country was reduced without a cap on the number of shipments.

This, they suggested, “could have implications for negotiations with the European Union and South Korea,” hinting that a precedent may have been set for a more favorable outcome for other auto-exporting nations.

The gross impact of the tariffs on Japanese automakers is now projected to be about ¥1.9 trillion with the rate at 15%, a significant downward revision from the previous estimate of around ¥3.5 trillion at a 25% tariff rate, according to a note from Goldman Sachs Japan Co. analyst Kota Yuzawa.

‘Open their country’: a familiar US demand resurfaces

President Donald Trump’s latest trade deal also included a familiar, though somewhat forgotten, demand for Japan to “open their country” to cars imported from the US.

This potentially breathes new life into a contentious issue that was a major point of friction between the two nations in the 1980s and 1990s.

For decades, U.S. automakers like Ford Motor Co. and General Motors Co. have sought to gain a significant foothold in the Japanese market, but their sales numbers there remain minuscule.

The trade imbalance is stark: in 2024, Japan exported nearly 1.4 million cars to the U.S., but imported just about 16,000 US-built automobiles.

The long-standing arguments explaining the unpopularity of American cars in Japan are well-known: they have historically been seen as too fuel-inefficient, too large for Japan’s narrow roads, and not designed with domestic tastes in mind.

While US automakers have introduced models to address some of these criticisms, local car buyers have consistently shown a strong preference for German-made imports above others, a trend that is not likely to change soon.

“Past efforts have yielded limited success,” commented Bloomberg Intelligence senior auto analyst Tatsuo Yoshida.

However, as consumer preferences shifted toward minivans like the Japan-specific Odyssey and SUVs such as the first-generation CR-V, US-built imports gradually lost traction.

Japan’s concessions: streamlining certification and tapping dealerships

As part of the new trade pact announced on Wednesday, Japan has agreed to forgo additional safety tests for vehicles imported from the US, according to Ryosei Akazawa, the country’s top trade negotiator.

“This means Japan will streamline certification of US-made cars,” Akazawa said on Wednesday, while adding, “Ensuring public safety will of course be a prerequisite.”

This move aims to address one of the key hurdles that has historically made it costly and difficult to sell US cars in Japan.

In the 1990s, bilateral tensions had fueled a push to increase imports from the US, which even led some Japanese carmakers to “reverse import” cars that were manufactured or assembled in their North American plants back to Japan.

While those efforts helped to offset some of the trade imbalance, they never gained significant traction, with the differing vehicle safety regulations between the two nations proving to be a particularly costly obstacle.

To further support the import of US cars, the Japanese government is reportedly planning to tap the extensive dealership networks of its local automakers to sell American vehicles, Kyodo reported, citing an unidentified person.

The report also said that officials plan to urge Japanese automakers to export cars made in their US plants back to Japan.

The post US-Japan trade deal boosts European automaker stocks; Porsche, BMW gain appeared first on Invezz

0 comment
0
FacebookTwitterPinterestEmail

previous post
Europe markets open: stocks rise; autos jump 3.5% on trade optimism; Nokia down
next post
Rolls-Royce share price drops: July 31 will be crucial

Related Posts

Tilray stock pops 15%: should you sell TLRY...

July 23, 2025

Musk may not be done with US politics:...

July 23, 2025

Nikkei 225 Index is surging: here are the...

July 23, 2025

Asian markets open: Nikkei surges over 3% on...

July 23, 2025

Glencore share price outlook as it shuts key...

July 23, 2025

The $550B handshake: Inside Trump’s mega Japan deal...

July 23, 2025

Rolls-Royce share price drops: July 31 will be...

July 23, 2025

Europe markets open: stocks rise; autos jump 3.5%...

July 23, 2025

Tesco share price is soaring: can it hit...

July 23, 2025

Is D-Wave stock the best way to play...

July 22, 2025

Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.

By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

Recent Posts

  • Ontario’s Proposed Special Economic Zones Underscore Regulatory Harm Everywhere Else

    July 23, 2025
  • Bye, Monopoly: Entrepreneurs Bring Markets Back to Education

    July 23, 2025
  • Should We Stop Adding Fluoride to Drinking Water?

    July 23, 2025
  • Bye, Monopoly: Entrepreneurs Bring Markets Back to Education

    July 23, 2025
  • Ontario’s Proposed Special Economic Zones Underscore Regulatory Harm Everywhere Else

    July 23, 2025
  • Should We Stop Adding Fluoride to Drinking Water?

    July 23, 2025

Editors’ Picks

  • 1

    Meta executives eligible for 200% salary bonus under new pay structure

    February 21, 2025
  • 2

    Walmart earnings preview: What to expect before Thursday’s opening bell

    February 20, 2025
  • 3

    New FBI leader Kash Patel tapped to run ATF as acting director

    February 23, 2025
  • 4

    Anthropic’s newly released Claude 3.7 Sonnet can ‘think’ as long as the user wants before giving an answer

    February 25, 2025
  • 5

    Nvidia’s investment in SoundHound wasn’t all that significant after all

    March 1, 2025
  • 6

    Elon Musk says federal employees must fill out productivity reports or resign

    February 23, 2025
  • 7

    Cramer reveals a sub-sector of technology that can withstand Trump tariffs

    March 1, 2025

Categories

  • Economy (1,926)
  • Editor's Pick (186)
  • Investing (185)
  • Stock (1,278)
  • About us
  • Contact us
  • Privacy Policy
  • Terms & Conditions

Copyright © 2025 Portfolioperformancetoday.com All Rights Reserved.

Portfolio Performance Today
  • Investing
  • Stock
  • Economy
  • Editor’s Pick
Portfolio Performance Today
  • Investing
  • Stock
  • Economy
  • Editor’s Pick
Copyright © 2025 Portfolioperformancetoday.com All Rights Reserved.

Read alsox

Here’s why Hong Kong’s Hang Seng Index...

June 9, 2025

Indian markets close: Sensex plunges 589 pts,...

April 26, 2025

Asian markets close: Sensex plunges 645 pts,...

May 22, 2025