• Japan's chief negotiator Ryosei Akazawa plans another US visit after inconclusive third round of talks
  • Tokyo maintains hardline stance demanding full removal of auto and steel tariffs
  • US offers only limited concessions as trade tensions threaten key Japanese export sectors

Stalled Negotiations Prompt Another Round

Japan's top tariff negotiator Ryosei Akazawa will return to Washington later this month following this week's unsuccessful third round of talks, according to people familiar with the matter. The latest negotiations ended without progress on Japan's key demand - the complete elimination of US tariffs on automobiles, auto parts, steel and aluminum imposed by the Trump administration.

"We cannot accept partial measures when the fundamental issue remains unresolved," said a Japanese trade official who requested anonymity due to the sensitivity of ongoing discussions. The US has so far only offered to consider reducing a 14% country-specific tariff or extending a temporary suspension, proposals Japan views as inadequate.

Economic Stakes Heighten Urgency

The impasse comes as Japanese automakers report strong US sales, with industry analysts attributing the surge to consumers rushing purchases before potential price hikes. Toyota Motor Corp. and Honda Motor Co. both posted double-digit percentage gains in May, suggesting buyers may be anticipating higher costs if tariffs remain.

Steel exporters face more immediate pressure, with the 25% duty already cutting into profit margins. "Every month these tariffs stay in place forces more difficult decisions about production and supply chains," said an executive at a major Japanese steelmaker who asked not to be named.

Political Calculus

Prime Minister Shigeru Ishiba's government has publicly called the US position "extremely regrettable," but behind closed doors officials acknowledge the challenging negotiation environment. The US maintains its tariffs are necessary to protect domestic industries and reduce trade deficits.

With both sides entrenched, the upcoming late-June talks appear unlikely to yield immediate breakthroughs. However, the continued high-level engagement suggests neither party wants the dispute to escalate further, according to trade policy experts monitoring the situation.

Market watchers will be looking for any signs of flexibility when Akazawa returns to Washington, particularly regarding the additional 10% "reciprocal" levy the US has threatened to impose. Japanese officials have indicated this remains a red line in negotiations.