US-Japan LNG Deals Could Ease Tariffs as Foxconn Enters EV Manufacturing
Trump's administration hints at tariff reductions linked to LNG deals, with Mitsubishi eyeing Alaska's pipeline project. Meanwhile, auto tariffs threaten Nissan-dependent communities
*Editor’s note: This article was originally published on 4/9/2025 on Linkedin.
Welcome! I'm Hiroyasu Ichikawa, ichi, and this is issue 148 of the "Japan Climate Curation" newsletter📬, which has been curating hand-picked Japan-related climate news content every week since spring 2022, with over 440 subscribers [ more than 2,770 on Linedin]. You can subscribe by clicking on the Linkedin page or the form below.
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*Disclaimer: Generative AI tools such as Claude Sonet 3.5 has been used for summary and translation assistance 🙂
【Digest of this week's topics】
This week's developments show Japan's economic landscape shifting amid international pressures. Trump's administration hints at tariff reductions linked to LNG deals, with Mitsubishi eyeing Alaska's pipeline project. Meanwhile, auto tariffs threaten Nissan-dependent communities like Kanda. Foxconn enters Japan's EV market, and partnerships are expected soon. Environmental issues remain prominent as PM2.5 pollution costs Japan billions annually, and executives could face liability for climate inaction. Notably, most Japanese banks have withdrawn from the Net-Zero Banking Alliance, reflecting changing priorities in response to U.S. policies.
[🇯🇵📰👀Japan Climate News Headlines]
【1】LNG deals with Japan, South Korea could reduce tariffs, U.S. officials hint [04/09 Nikkei Asia]
The Trump administration has indicated that ongoing LNG deals with Japan, South Korea, and Taiwan could lead to tariff reductions. The $44 billion Alaska natural gas pipeline project envisions Asian countries providing financing and purchasing commitments, with exports targeted to begin by 2030. President Trump mentioned positive negotiations with a South Korean delegation and claimed China also seeks a deal. The arrangement is expected to create American jobs and reduce the trade deficit.
【2】Trump's Tariffs Imperil the Fortunes of a Nissan Factory Town [04/07 The New York Times]
Kanda, a small town in Kyushu, has grown alongside Nissan's factory, which produces hundreds of thousands of cars annually, half of which are bound for the US. As Nissan considers shifting Rogue production to America, Trump's 25% auto import tariffs threaten the town's future. Any major production shift could lead to job cuts in Kanda, a few Japanese cities with a growing population and no reliance on government subsidies. With Nissan restructuring globally, prolonged tariffs could force structural changes, potentially halving Japan's economic growth.
【3】Japan's Mitsubishi may consider investing in Alaska LNG project, CEO says [04/03 Reuters]
Mitsubishi Corp CEO Katsuya Nakanishi stated the company is considering investing in the $44 billion Alaska LNG project promoted by President Trump, but will carefully evaluate the 1,300km pipeline requirement, liquefaction facilities, and future demand in Southeast Asia. Simultaneously, Mitsubishi unveiled a new three-year strategy with plans to invest 4 trillion yen ($27 billion) and targets a net profit of 1.2 trillion yen by FY2027/28. The company announced a share buyback plan of up to 1 trillion yen through March 2026. Warren Buffett's Berkshire Hathaway holds a 9.67% stake in the company.
【4】Hon Hai Makes Case to Build EVs for Japan's Automobile Industry [04/09 Bloomberg]
Hon Hai Precision Industry (Foxconn), known for manufacturing iPhones, is entering the EV contract manufacturing business for Japanese automakers, applying its Apple/Sony business model to the automotive industry. Jun Seki, former Nissan/Nidec executive, is leading this strategy to increase Foxconn's presence in Japan.
Having reportedly secured a deal with Mitsubishi Motors, Seki states, "several Japanese partnerships will be announced within a year." Foxconn offers manufacturing outsourcing as a solution for high costs and risks in EV transition while expanding production bases in the US, Taiwan, and Thailand.
【5】PM2.5 air pollution costs Japan $110bn a year, study finds [04/05 Nikkei Asia]
A University of Tokyo study reveals that PM2.5 air pollution costs Japan approximately $110 billion annually, with 86% of the burden falling on people aged 60 and older. The research examined regional GDP data from 2001-2019, considering healthcare costs, lost income, and reduced quality of life. Western Japan faces a greater impact, especially in rural areas with insufficient medical resources.
【6】Can the Net-Zero Banking Alliance retain its sole Japanese member? [04/07 Financial Times]
Over the past month, five Japanese banks have withdrawn from the Net-Zero Banking Alliance (NZBA), with Mizuho Financial Group being the latest to leave. Only Sumitomo Mitsui Trust Group remains.
The exodus is primarily driven by prioritizing US business expansion under the Trump administration, encouraging investment in Alaskan LNG projects, and addressing energy security concerns following Russia's invasion of Ukraine. Experts predict the last Japanese member will likely exit as well. Meanwhile, NZBA is considering relaxing membership rules by removing the requirement for banks to align their assets with the Paris Agreement's 1.5°C target.
【7】MIT turns to Japan in quest to reinvent concrete [04/09 NHK World]
Concrete is everywhere in urban life, but could it be tweaked to serve other functions? A US and Japanese team thinks so and aims to develop concrete that conducts heat and stores energy.
【8】How Japan Built a 3D-Printed Train Station in 6 Hours [04/08 The New York Times]
West Japan Railway introduced the world's first 3D-printed station at Hatsushima in Arida, Wakayama Prefecture. Components were printed in a Kumamoto factory and assembled on-site in 6 hours between train services. This method reduced construction time from 2+ months to 6 hours at half the cost, offering a solution for maintaining railway infrastructure in rural areas with declining populations. The 100-square-foot station will open in July.
【9】Japanese execs could face lawsuits for climate inaction: report [04/03 The Japan Times]
According to a UK-based Commonwealth Climate and Law Initiative report, Japanese corporate directors could be held personally liable for failing to address climate risks. The study warns that ignoring climate-related financial threats could expose executives to lawsuits, regulatory scrutiny, and financial losses. By 2050, Japan could face ¥952 trillion in economic damage.
【10】Investment in Japanese Startup Stable in 2024 as Fund Formations Entered New Phase [04/01 Speeda]
Japanese startup investment remained stable at JPY 779.3 billion in 2024 (+3% YoY), with larger deals over JPY 5 billion increasing in H2. Notable foreign investors like Khosla Ventures and New Enterprise Associates showed growing interest, while the total value of newly formed funds decreased significantly YoY. However, the CVC ratio increased, and M&A activity was robust. Timee and Astroscale Holdings achieved IPOs exceeding the JPY 100 billion market cap despite a lackluster IPO environment. The government plans to leverage the Osaka Expo 2025 to attract more foreign investment and promote its Startup Development Five-Year Plan.
📬That's all for this week! Thank you for reading(or skimming) 🙇. I hope you will have a wonderful week ahead!
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