By Michelle Ndaga
Japan’s exports to the United States fell sharply again in August 2025, declining by 13.8% year-on-year, marking the fifth consecutive month of contraction. The steep drop is being linked largely to elevated U.S. tariffs on Japanese automobiles and auto parts.
According to data from Japan’s Finance Ministry, automobile exports declined by about 28.4%, while auto parts suffered their own losses, contributing significantly to the overall fall in U.S.-bound shipments.
Even though the U.S. recently reduced the auto and parts tariffs from 27.5% to 15%, they remain well above pre-tariff levels and continue to weigh heavily on trade.
Despite the sharp drop in U.S. exports, Japan’s overall export performance was relatively stable for August, slipping only about 0.1% year-on-year.
Gains in shipments to regions such as Europe and the Middle East helped offset some of the losses. On the import side, Japan saw a 5.2% decline in total imports compared to the same period last year.
Earlier in the year, May and June had shown similar trends: exports to the U.S. fell by around 11.1% in May (with auto exports down ~24-25%) and by 11.4% in June. The auto sector has emerged as the most vulnerable, being a cornerstone of Japan’s export economy.
Economists warn that these continued drops are raising the risks of a technical recession in Japan, as exports are a major component of GDP and have been under pressure for several months.
