President Trump might be clear about his tariff plans—but some countries hit with the levies are still waiting anxiously for clarity on some key aspects of the duties.
The details: With the August 1, tariff deadline imposed by Trump now passed—officials from the EU, Japan, and South Korea are still in limbo on some next steps, as their respective automakers try to navigate the new tariff landscape.
Japan is pushing the U.S. to implement the already agreed 15% cut to auto tariffs and clarify levies for other goods—amid conflicting interpretations of the trade deal.
South Korea is still trying to nail down with the Trump Administration the timing of the promised tariff cuts on the country's car exports to the U.S. from the current level of 25%.
German auto officials are pressing for the promised U.S.-EU trade agreement to be implemented now and are raising concerns about the negative effect the 27.5% sectorial levies will have on its auto industry.
What they’re saying: "In negotiating with the U.S., Minister (Ryosei) Akazawa (Japan’s top trade negotiator) at least ought to have nailed down exactly when U.S. automobile tariffs would be lowered to 15%,” said Former Japanese Trade Minister Ken Saito.
Why it matters: The lack of clarity on some aspects of the tariffs makes it challenging for automakers to make the necessary operational adjustments to manage the costs associated with the levies.
Between the lines: The uncertainty appears to play right into Trump’s negotiation style, which consultant Sebastian Moritz said is rooted in a game theory strategy.
The approach appears unstructured—but at its core, it sets up negotiations where the other side has very limited choices, explained Moritz.
Successful negotiators don’t play by their counterpart’s rules—but instead shape the rules of the game and, ultimately, the outcome, the consultant added.
People are far more motivated by the fear of losing something than by the opportunity to gain something of equal value, said Moritz.
In his words: “From a game theory perspective, power in negotiations comes down to two key factors. The first is the number of alternatives available to you. The second is your ability to commit to a specific course of action. These are the two levers of power in play,” said Sebastian Moritz, Managing Partner of TWS Partners.
Bottom line: The uncertainty surrounding tariff details can create operational challenges and financial risks for automakers, which require stability. With the ambiguity of Trump’s “The Art of the Deal” negotiation tactics, countries face additional pressure to make concessions or adjust quickly once clearer terms emerge.
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