A new trade deal between the U.S. and Japan heads off what could have been 25% tariffs on all Japanese-made goods, including automobiles. But the agreement nonetheless raises tariffs from the previous 2.5% to 15% which could translate into substantial price hikes on scores of vehicles imported from that Asian automotive powerhouse.

The settlement, described by Pres. Donald Trump as “perhaps the largest Trade Deal ever made,” on his site Truth Social, sets no limits on auto imports, unlike a “voluntary” trade agreement from the 1980s. But it also creates a $550 billion fund to expand Japanese investments in the U.S. And that could see automotive manufacturers like Toyota, Honda and Nissan expand their network of American parts and assembly plants.

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