Japanese trade deal a negative for Ford and GM, says BofA

After President Trump announced that the U.S. and Japan reached a trade deal that media reports indicate will lower tariffs, including on vehicles imported to the U.S. from Japan to 15% from the current 25% rate, BofA notes that despite the two trading partners having found an agreement, the rate appears set at 15, while before the initial tariff announcements the rate was at 2.5%. The firm views the deal as a negative for domestic OEMs Ford (F) and General Motors (GM) and it implies that Japanese competitors, such as Toyota (TM), Honda (HMC), and Nissan (NSANY), now face lower cost of entry into the U.S. market while Ford and GM still face a 25% tariff rate on vehicles produced and imported from Korea, Canada and Mexico.