Japanese Firms in U.S. Watching Impact of Trump's Election Win

New York, Nov. 10 (Jiji Press)--Japanese companies operating in the United States are closely monitoring the impact of former U.S. President Donald Trump's victory in last week's presidential election.

Their focus is on the fate of massive financial support for the purchase of electric vehicles and the development of decarbonization-related facilities, as well as the handling of tariffs on cars imported from Mexico and other countries.

The administration of President Joe Biden enacted the Inflation Reduction Act, which allocated a record 391 billion dollars to combat climate change. Actual necessary expenditures for related projects are forecast to be significantly larger, and Trump is highly likely to review government spending to finance an extension of the so-called Trump tax cuts, set to expire next year.

The first IRA project expected to be on the chopping block is a tax credit of up to 7,500 dollars for those who purchase EVs. Japanese automakers are planning to start full-scale EV production in the United States, and they would be dealt a blow if the tax credit is eliminated, sources said.

Meanwhile, Japan's Toyota Motor Corp. and Honda Motor Co. are seen able to adapt to the expected change in demand, thanks to robust sales of their hybrid vehicles.

[Copyright The Jiji Press, Ltd.]