JAKARTA - The global automotive industry is facing a number of tough challenges, one of which is facing tariffs from the President of the United States (US) Donald Trump.

The 25 percent import rate imposed by Donald Trump not only had an impact on intact vehicles, but also on foreign parts supplyers.

Kyowa Industrial is one of the parts suppliers who is faced with concerns about their ability to withstand tariff pressures in the Japanese auto industry.

"What are we going to do with this rate? It will get worse," Kyowa Industrial President Hiroko Suzuki was quoted as saying by Reuters on Saturday, May 24.

Kyowa does not export car components to the US, but the company is concerned that automakers will force suppliers to cut prices to off tariffs. So far, that hasn't happened yet.

On the other hand, manufacturers like Subaru said the company may have to start looking for partners that expand outside the US.

Meanwhile, other auto giants have mostly offered support to suppliers since Trump's tariff announcement. For example, Toyota, Nissan, and Ford have sent letters to US branches of several Japanese suppliers asking for cooperation in dealing with tariffs.

Nissan told suppliers they must stick to the agreed price.

In the deal, suppliers have no obligation to bear tariff fees but will shoulder part of the blow for up to four weeks to help secure its supply chain.

The manufacturer added that later it could seek to recover any payment of support to suppliers.

The automakers have not sent follow-up letters, according to two suppliers. Nissan told Reuters they were working with suppliers to reduce tariff impacts and reduce costs, including through localization.

Ford also ensures that it will work closely with suppliers to assess their risks and the possibility of reconfiguring the process and resources.

Toyota also said it would try to protect its suppliers, dealers and employees while maintaining customer confidence when facing tariff-induced uncertainty.

Some of its suppliers, such as Denso, have not provided an estimated revenue for the coming year, citing uncertainty.

To deal with this situation, Japan's main trading negotiator, Ryosei Akazawa also headed to Washington on Friday for a third round of talks.

Previously, Japanese prime minister Shigeru Ishiba called the import rate set by Donald Trump a national crisis for this sunrise country.


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