Trump's Tariff Threat Hits Japanese Automakers and Korean Battery Stocks

Japanese automakers and South Korean battery makers faced market losses following U.S. President Donald Trump’s comments on imposing tariffs on Canada and Mexico and reversing the previous administration’s electric vehicle policies. The proposed 25% tariffs, potentially effective February 1, signal shifts in U.S. trade policies that could pressure manufacturing industries in Japan and South Korea.

Nissan Motor shares dropped 0.3% to 420.9 yen after initial gains. Nissan’s two Mexican plants produce Sentra, Versa, and Kicks models, exporting 300,000 vehicles annually to the U.S., as noted by CEO Makoto Uchida in November. Honda Motor shares also fell 0.3% to 1,479 yen after rising to 1,526 yen earlier. Honda’s COO Shinji Aoyama previously warned that permanent tariffs could force production shifts, with 80% of its Mexican output destined for the U.S.

South Korean battery makers also suffered declines. LG Energy Solution dropped 5%, while Samsung SDI and SK Innovation fell over 4% each.

Japanese Finance Minister Katsunobu Kato stated the government would evaluate and respond appropriately to these policy changes.

The threat of tariffs compounds existing challenges for automakers adapting to electric vehicle demand and rising competition from Chinese manufacturers. These developments underscore the ripple effects of U.S. policy changes on global manufacturing and trade alliances.