Japan Folds Like a Lawn Chair And Writes Trump a $550 Billion Check... Toyota and Honda Go Vertical

It feels like yesterday that every world leader had the same opinion on Trump’s tariff obsession. “He’s bluffing.” “It’ll never work.” “He doesn’t understand international trade.” “We’ll never go with any of this, does this bloke really think we’ll fall for this bloody hell?” (England’s Prime Minister, probably). But here we are, and one by one, countries are folding. Turns out, Trump’s playbook of throwing out wild tariff threats, letting things get just bad enough, and then swooping in to “negotiate” a middle ground… might actually be working.

Maybe he wasn’t bluffing when he said he had “concepts of a plan” during that debate with word-salad Kamala. Because now (would you look at that) Japan, one of the biggest auto exporters on Earth, just signed a deal with Trump that makes all that earlier scoffing age about as well as milk in the sun.

This new agreement, announced Tuesday, had Trump calling it “perhaps the largest Deal ever made.” And while that’s classic Trump hyperbole (this is the same guy who once praised Jake and Logan Paul as great boxers), the numbers here are actually worth taking seriously. Under the deal, Japan will lower its auto tariffs to 15%, down from the 25% rate that had Tokyo blowing up The White House phone just a few weeks ago. That’s a big deal when you consider that cars, trucks, and buses made up over 28% of Japan’s exports to the U.S. in 2024.

(Source: Fox Business)

But it didn’t stop there. Trump says Japan will invest $550 billion into the United States and that the U.S. will receive 90% of the profits. (How that math works exactly? Unclear. But let’s just say he’s not pitching a 50/50 partnership.) Japan’s also agreeing to open its market to more American goods… everything from rice to trucks to what Trump simply called “other things.” Which sounds vague until you realize it probably doesn’t matter what the other things are… because Wall Street liked all of it.

Japanese Prime Minister Shigeru Ishiba called the agreement a “new golden era” in U.S.-Japan relations, while Japan’s top trade negotiator actually posted “#MissionAccomplished” on X. Which, yes, is a bit risky historically, but they’re riding high right now.

And speaking of riding high… Japanese auto stocks absolutely took off on the news. Toyota jumped over 14%. Honda surged 11%. Even Mazda (basically the stepbrother of Japan’s car family who usually gets left out of the group photo) spiked 17%. The broader Nikkei 225 popped more than 3.5% (its biggest move in weeks) after investors realized Trump’s tariffs weren’t going to hit nearly as hard as expected. Once again, it looks like Trump’s scorched-earth negotiating style is starting to land real results. Turns out all it needed was a little time to marinate.

So what changed? Just a few months ago, a 15% tariff would’ve triggered diplomatic meltdowns and panicked markets. Today? It’s being treated like a discount. Brian Jacobsen from Annex Wealth nailed it: “A year ago, that level of tariffs would be shocking. Today, we breathe a sigh of relief.” The takeaway? Starting absurdly high and then settling somewhere in the middle might actually be a legit strategy. So the next time someone tells you listing your used underwear for $80 on Facebook Marketplace is a bad move… just send them this article.

Not everyone’s thrilled, though. Matt Blunt from the American Automotive Policy Council (representing GM, Ford, and Stellantis) slammed the deal, saying it gives Japanese cars an edge over North American-built vehicles packed with U.S. content. In other words: Detroit feels shafted. Again. But try telling that to investors who just watched Mazda’s stock rise from the dead.

Zooming out, this feels less like a one-off and more like a warning shot. Trump says Europe is up next. And he’s already teasing a $500 billion U.S. infrastructure investment wave from names like SoftBank, Oracle, and OpenAI… tying these deals to strategic plays in AI and energy. Clearly, this isn’t only about trade deficits anymore. It’s about leverage (and he’s got it).

Whether you love him, hate him, or are still trying to figure out how he convinced Japan to write a half-trillion-dollar check, one thing’s clear: Trump’s tariff playbook might look like chaos… but the scoreboard’s lighting up. Japan made a deal. Stocks ripped. And leaders who were once mocking the strategy? They’re now looking for pens.

No, it’s not all happening overnight. But if this trend keeps up, some of Trump’s loudest critics might start reaching for their MAGA hats… if only to wear them quietly around the house.

At the time of publishing this article, Stocks.News holds positions in Ford and Meta as mentioned in the article.