"The trade deal struck with the U.S. is certainly a relief in that it offers some certainty that U.S. tariffs on Japan-made cars won't rise to punitive levels," said Stefan Angrick, head of Japan and Frontier market economics at Moody's Analytics.

That's down from the 25% levies he proposed earlier this month. Japan's prime minister says duties on autos from his nation will be cut to 15% from 25%.

U.S. President Donald Trump struck a trade deal with Japan that lowers tariffs on auto imports and spares Tokyo from punishing new levies on other goods in exchange for a $550 billion package of U.S.-bound investment and loans.

President Trump announces a trade deal framework with Japan, imposing a 15% tariff on Japanese imports while eliminating tariffs on U.S. exports to Japan.

U.S. automakers worry that President Donald Trump’s agreement to tariff Japanese vehicles at 15% would put them at a competitive disadvantage, saying they will face steeper import taxes on steel, aluminum and parts than their competitors,

Over the past few decades, Japan-based automaker Toyota has spent billions of dollars to expand its manufacturing and assembly plants in the United States. Those plants now employ over 64,000 people across North America and have churned out millions of vehicles.

Japanese automakers received a temporary reprieve this week when U.S. President Donald Trump announced a cut to import tariffs on Japan-made vehicles, reducing the rate from 25% to 15%. But industry experts warn the move offers little comfort as Japanese brands face intensifying competition from China and structural economic hurdles at home.

Trump’s so-called reciprocal tariffs are scheduled to go into effect on August 1 after a 90-day delay—just as American families begin back-to-school shopping—and could hike up the cost of consumer goods imported from other countries.