Trump Pledges to Open South Korean and Japanese Auto Markets... NYT Says "Effectiveness Is Limited"

Experts: "Driven by Trump's Political Necessity"

Donald Trump, President of the United States, has pledged to open the automotive markets of South Korea and Japan by signing trade agreements, but the New York Times (NYT) reported on August 5 (local time) that the effectiveness of these measures is limited. Automotive industry experts have pointed out that promises to eliminate trade barriers are unlikely to significantly boost sales of American vehicles.

In an interview with CNBC on the same day, President Trump highlighted the results of recent trade deals, stating, "South Korea used to be a closed country, but now, suddenly, we can sell cars, trucks, and sport utility vehicles (SUVs) in South Korea. We are truly opening up South Korea," he said.

Donald Trump, President of the United States. Photo by UPI Yonhap News

Even before the trade agreement, South Korea had been importing American-made vehicles. However, the United States had argued that South Korea's automotive safety and environmental standards constituted non-tariff barriers. According to the Ministry of Trade, Industry and Energy, under the new agreement, South Korea has decided to recognize American-made vehicles that meet U.S. safety standards as also meeting Korean standards.

The U.S.-Japan trade agreement contains similar provisions. The Trump administration announced that Japan would allow imports of American-made vehicles without inspections based on its own safety standards. American cars are not particularly popular in the South Korean and Japanese markets. Last year, the share of American companies such as General Motors in the Japanese market was less than 1%. Ford withdrew from the Japanese market in 2016 due to low profitability.

Industry experts are questioning whether the trade agreements will have any impact on sales. Taking Japan as an example, roads are narrow and congested, so most consumers prefer small, fuel-efficient vehicles. This contrasts with the lineups of American companies, which are dominated by trucks and SUVs.

Tsuyoshi Kimura, a professor at Chuo University in Japan who worked at General Motors from the late 1990s to the early 2000s, said that trade barriers have never been an issue for American car companies operating in Japan. "Considering the basic needs of the market, American vehicles are not suitable. Even if Japan opens its automotive market, the likelihood of American cars selling well is low," he said.

The United States and Japan previously clashed over the sales of American vehicles in the Japanese market during the 1980s and 1990s. Ultimately, in 1995, Japan agreed to several measures, such as expanding access to dealerships for foreign cars, but there was no change in the sales of American vehicles in Japan. At the time, Glenn S. Fukushima, former president of the American Chamber of Commerce in Japan, was also known to drive a Nissan instead of a Cadillac, as the American car was too large to navigate the winding roads near his home in Tokyo.

Despite the limited effectiveness, President Trump's focus on removing automotive trade barriers is driven by political necessity. Alan Wolff, Senior Fellow at the Peterson Institute for International Economics, noted that this is similar to President Trump's emphasis on U.S. dairy exports during the first term's United States-Mexico-Canada Agreement (USMCA). "Signing agreements that open up specific export sectors holds political significance for President Trump. It is important to President Trump, and therefore it is important to the United States," he explained.

This content was produced with the assistance of AI translation services.