Toyota, the world’s best-selling brand, was the first among Japanese manufacturers to commit to complying with the new trade directives imposed by Donald Trump, inventing a curious “goose chase” that involves exporting vehicles produced by the Japanese manufacturer in the United States and assembled locally to serve exclusively – at least so far – that market back to Japan, thus increasing the trade balance in favor of the US.
ALL OF TOYOTA’S AMERICAN PLANS
But apparently, Toyota’s American plans (in the US the Japanese manufacturer is already strongly present and employs about 48,000 people) will not stop there. Last November, the Japanese company announced a new investment plan of ten billion dollars in favor of US activities to be carried out by 2030.
TWO US PLANTS TO BE STRENGTHENED
The first part of this plan consists of one billion dollars arriving already this year to benefit two US factories. Specifically, 800 million dollars will be allocated to the Georgetown plant in Kentucky to increase the production capacity of the Camry sedan and the RAV4 crossover, while another 200 million will be invested in the Princeton plant in Indiana to expand production of the Grand Highlander SUV.
TRUMP’S RUDE BEHAVIOR
The multibillion-dollar plan announced last November was, moreover – as usual – irregularly anticipated in public by US President Trump during a press conference even before Toyota had the chance to announce it to its shareholders.
JAPAN MAKES A GOOD FACE TO A BAD GAME
The renewed friendship between the two countries whose shores are washed by the Pacific is guaranteed by the new Japanese premier Sanae Takaichi, described at home as an iron lady (she would call cabinet meetings at 3 a.m.) while abroad she is much more accommodating (she remained silent while Trump, next to her, mockingly recalled the Japanese attack on the US base at Pearl Harbor and allowed herself a plea that certainly stroked the American president’s ego: “Only you, Donald, can bring peace to the world”). In short, Japanese policy towards the American ally is clear.
Moreover, as CNBC reminds us, Akio Toyoda, Toyota’s president, has in recent months tried in every way to ingratiate himself with Trump (with whom he shares hostility towards electric cars), even going so far as to wear the characteristic red cap with the inscription “Make America Great Again” and a t-shirt featuring images of the tycoon and US Vice President JD Vance.
US TARIFFS ARE A HEAVY BURDEN ON TOYOTA’S ACCOUNTS
Despite the smiles and convenient bows, American investments are obviously “extorted” from the Japanese by the new American trade policies: Toyota has estimated that US tariffs will cost 1.4 trillion yen in the closing fiscal year (and the situation is no better for other Japanese brands), so to avoid losing a fundamental market for its SUVs and pickups, the Land of the Rising Sun brand finds itself forced to invest increasingly heavily in the United States.
