Business
Trump’s Car Tariffs Worry Toyota and Japan’s Automakers
Before the election, Toyota Motor and other Japanese automakers thought a second Trump administration could be good for them.
President Trump had campaigned on dismantling policies aimed at swiftly accelerating the U.S. auto industry’s shift away from fossil fuels and to electric vehicles — directives that Toyota and other leading manufacturers of gasoline and hybrid gasoline-electric cars had also long opposed.
Toyota donated $1 million to Mr. Trump’s inauguration in January, and attendees at the company’s dealership meeting in Dallas that month said it was brimming with Trump cheer.
But as Mr. Trump’s agenda has taken shape, much of that optimism has turned to alarm.
In February, the administration signed an executive order imposing 25 percent tariffs on goods from Mexico and Canada, where Toyota and other Japanese companies assemble many of the cars they sell in the United States.
The administration has said that on April 2 it will announce “reciprocal tariffs” on countries that run large trade surpluses with the United States — a move widely expected to affect Japan and its cars.
Japan is one of the world’s largest automobile exporters, and the United States is the biggest market for companies like Toyota, Honda, Nissan, Mazda and Subaru. So, as the tariff deadline approaches, Japan is now preparing for a blow that could be devastating not only to the profits of the nation’s automakers but to its overall economy.
With Japan’s economy already stifled by inflation, some economists estimate that if Mr. Trump’s automotive tariffs take effect as threatened, they could wipe out 40 percent of potential economic growth this year.
Mr. Trump has long had a combative relationship with Japanese car companies. In the 1980s, when he floated the possibility of a presidential run, Mr. Trump railed against auto giants from Japan, once telling Oprah Winfrey that they come to the United States and “knock the hell out of” local manufacturers.
Shortly after Mr. Trump was first elected in 2016, Toyota came forward with plans to invest $10 billion in the United States. Japan’s former prime minister Shinzo Abe — who was considered a skilled Trump whisperer — leveraged the president’s love of adulation and secured a promise not to impose additional duties on Japanese cars.
Japan’s success in fending off tariffs the first time around was part of the reason many leaders in the automotive industry were sanguine — and even hopeful — about another Trump term. The other reason, especially for Toyota, involved electric vehicles, which Mr. Trump had mostly ridiculed before recently declaring himself a fan of Tesla, the company run by his close adviser Elon Musk.
In the early 2020s, when many of its competitors rushed into electric vehicles, Toyota held firm to the hybrid gas-electric cars it had pioneered decades earlier. The company argued that the world was not fully ready for electric vehicles. They were expensive for consumers and the infrastructure needed to charge their batteries remained incomplete.
Automakers were also mostly selling electric vehicles at a loss. The prospect of Mr. Trump’s rolling back initiatives intended to rapidly spur the transition to electric cars was seen as a way for Toyota to buy time, given that it had only one mass-market electric vehicle available in the United States.
Toyota lobbied against stricter Biden-era tailpipe pollution limits and supported politicians in the United States who were against what it viewed as “mandates” to sell more electric vehicles. Much of this lobbying came via Toyota’s network of car dealerships, some of which, after being prompted by Toyota, conveyed their concerns about a swift transition to electric vehicles to elected officials, according to correspondence viewed by The New York Times.
A spokesman for Toyota said providing customers with affordable vehicles and a variety of options was the best way to reduce emissions as soon as possible, which is the company’s goal. “A consumer-driven market will bring more stability and healthy competition to the auto industry,” he said.
At the January dealership meeting in Texas, leaders of Toyota’s North America business said that they believed the company had held firm during the presidency of Joseph R. Biden Jr., and that they were now hopeful they had more “like-minded politicians” in positions of power, according to two people who attended the event who were not authorized to talk publicly.
The next month, Mr. Trump outlined plans for tariffs that could hit exports of cars from Canada, Mexico and likely Japan.
The Trump administration’s plans for tariffs have shifted often. But the prospect of new taxes on foreign-made cars is already weighing on Japanese auto companies and some of their dealerships in the United States.
In Maine, Adam Lee is the chairman of Lee Auto Malls, one of the state’s largest auto dealership groups. Lee Auto Malls sells brands including Toyota, and last month it had its worst February in terms of net profit since 2009.
As Mr. Trump has unveiled his tariff agenda over the past two months, “faith in the economy has seemed to be the lowest it has been in a long time,” Mr. Lee said. “People don’t buy cars when the world is in chaos,” he added.
Analysts expect Japan and South Korea, because of their large presence in the United States and tendency to import many of the cars they sell there, to be the automaking countries most exposed to Mr. Trump’s proposed tariffs.
Toyota made about one million of the 2.3 million cars it sold in the United States last year outside the country. Executives at Nissan and Honda have warned that Mr. Trump’s tariff plans would carve deeply into their earnings.
For Japan, whose top export is cars, a 25 percent tariff on automobile exports to the United States could reduce the country’s gross domestic product by around 0.2 percent this year, according to estimates from Japan’s Nomura Research Institute.
Given that Japan’s economy has a potential growth rate of only around 0.5 percent this year, a 0.2 percent hit to G.D.P. would represent a “considerable blow,” according to the research institute.
For now, some Japanese car companies are trying to accelerate shipments to the United States before April 2. They are also beginning preparations to ramp up production to the extent they can at the 24 manufacturing plants they operate inside the United States.
Over the past seven decades, Toyota has invested more than $50 billion in the United States, and it will continue to deepen those investments, a spokesman for the company said. Including in the United States, where it directly employs more than 49,000 people, Toyota’s philosophy has always been to “build where it sells and buy where it builds,” he said. Toyota is also fully compliant with the United States-Mexico-Canada trade agreement, he added.
Groups representing the automakers in Washington have also been working their contacts on Capitol Hill. They are hoping lawmakers can help make the case for how much Japanese auto manufacturers invest in the United States and how tariffs could hurt American consumers by raising prices.
So far, Japanese officials have failed to gain promises of exemptions from tariffs.
Three people involved in the lobbying efforts, who spoke on the condition of anonymity to discuss private conversations, say they are repeatedly asked: Are there any new investments they can commit to or ones in the pipeline they can repackage as inspired by the new president?
At the moment, the people said, they do not have new large projects to show.
Most Japanese automakers do not have excess production capacity in the United States, according to Michael Robinet, a vice president at the automotive intelligence provider S&P Global Mobility. That means that if they want to manufacture more vehicles, they would have to build new factories.
But factories would take years to build and demand significant investments from companies currently facing a “highly unstable trade environment,” Mr. Robinet said. “Automakers are not going to make decisions that have lots of zeros behind them unless they know that they have a solid business case,” he said. “And right now they don’t.”
Business
Former Google chief accused of spying on employees through account ‘backdoor’
When Columbia University law and MBA student Michelle Ritter met former Google chief executive Eric Schmidt in 2020, she said she wanted to pitch a potential investment in a sports tech startup she had been developing.
That dinner blossomed into far more, a romance and business partnership in which she says the 70-year-old billionaire invested in excess of $100 million into a jointly owned tech incubator — before it all fell apart.
Now, Ritter is accusing Schmidt of stealing business out from under her, sexually assaulting her twice during their relationship, and tapping his Google background to hack into her email and online computer files, according to a lawsuit filed Wednesday in Los Angeles County Superior Court.
“During their relationship, Schmidt confided that when he worked at Google, he built an insider “backdoor” to Google servers with a team of Google engineers in order to spy on Google employees. Accordingly, the backdoor enabled him to access anyone’s Google account and private information,” the lawsuit says.
Google is also named as a defendant in the lawsuit and is alleged to “knowingly acquiescing in, failing to remedy, and materially assisting the unauthorized access” into Ritter’s accounts despite being provided notice. Schmidt and the company are accused of violating the California Comprehensive Computer Data Access and Fraud Act, and a section of the state penal code that prohibits wiretapping.
Patricia Glaser, an attorney representing Schmidt, called the lawsuit “yet another desperate and destructive effort to publish false and defamatory statements to escape accountability from an existing arbitration over a business dispute.”
Glaser added: “The claims made here are directly contradicted by her own words … and are just a final Hail Mary to save her from the consequences of her own actions. We are confident that we will prevail on both the specific legal issue enforcing the arbitration and disproving these fabricated pathetic allegations.”
Google did not immediately respond to a request for comment.
The complaint is the latest filing in a legal dispute that stretches back to at least December 2024, when Ritter sought a domestic violence restraining order against Schmidt. She later withdrew it after reaching a financial settlement with Schmidt with whom she had started the high-tech New York incubator with offices in Los Angeles, according to court records.
In her new lawsuit, Ritter alleges that Schmidt has not honored the settlement due to false accusations she was behind a media leak. She is seeking to have the settlement, which requires arbitration of disputes, thrown out.
Schmidt’s attorneys have called her legal filings a “blatant abuse of the judicial system” and a “transparent hit piece intended to smear and defame” Schmidt, according to court records. He is seeking to have the dispute settled in arbitration.
Several records in the case are under seal and many filings are heavily redacted. The lawsuit seeks at least $100 million in damages, with the next hearing set for Dec. 4. She is being represented by the law firm of prominent Los Angeles attorney Skip Miller.
Schmidt served as Google chief executive from 2001 to 2011 and later as the chairman of the Silicon Valley company and its parent, Alphabet Inc., until 2017. He retains shares in parent Alphabet worth about $14 billion giving him a net worth of about $34 billion, according to Forbes. He owns multiple homes in greater Los Angeles.
In the application for the December 2024 restraining order, Ritter alleged she lived in an “absolute digital surveillance system” and that Schmidt had directed affiliates to steal her corporate website, take control of her digital business records and have personal investigators follow her parents, according to a court filing.
The restraining order request also asked the judge to order Schmidt to not assault her “sexually or otherwise.”
The lawsuit filed on Wednesday provides more details about their business ventures and alleges a personal relationship that developed to the point that Schmidt made promises to marry her and have children, despite their 39-year age gap.
The lawsuit states their Steel Perlot venture was a success, with Schmidt investing more than $100 million into the accelerator and its startups in AI, crypto and other industries — prompting Schmidt to wrest control of the venture and its businesses from her.
Media reports suggest otherwise. Forbes has written the venture ran out of money in 2003 and needed millions from Schmidt to meet payroll and other expenses.
The lawsuit alleges that Schmidt became abusive as the relationship progressed and he “forcibly raped” her while on a yacht off the coast of Mexico in November 2021 and had sex with her without her consent during the Burning Man festival in Nevada in August 2023.
Schmidt, who has been married more than 40 years, has been linked romantically in the media with a series of much younger women.
The bitter dispute with Ritter echoes another business disagreement he had with public relations executive Marcy Simon, with whom he had a two-decade relationship that ended in 2014. It also involved a troubled joint business venture, according to a New York Times report. The report did not involve sexual assault claims.
Schmidt has achieved a certain gravitas in Silicon Valley, serving as tech advisor to the Obama administration and the military, testifying about artificial intelligence on Capitol Hill and giving away more than $1 billion in charity.
He’s also a part owner of the Washington Commanders football team and has amassed a real estate portfolio estimated to be worth several hundred million dollars.
Schmidt is reported to have spent $110 million this year on the 56,000-square-foot mansion in Holmby Hills built by the late producer Aaron Spelling. In 2021, he acquired a 15,000-square-foot Bel Air estate previously owned by the Hilton family, where court records indicate Ritter lived at the time she filed the restraining order.
Schmidt earlier this year took a controlling interest in Relativity Space, a Long Beach startup founded in 2015 with the intent to bring 3-D manufacturing to rocketry.
However, it has since shifted its focus and Schmidt indicated in a social media post that his interest may have to do with launching AI data centers into space due to their huge power needs.
Business
Warner Music Group and AI startup Udio reach agreement in fight over copyrighted music
Warner Music Group on Wednesday said it reached an agreement with artificial intelligence startup Udio, ending a legal battle over concerns that copyrighted music was being used to train AI models.
Under an agreement, Udio will release a platform next year using AI models trained on licensed and authorized music, the New York-based companies said. The music could include content from WMG’s publishing businesses, providing new revenue for artists and songwriters who choose to opt in, the companies added.
Udio declined to say which artists would be involved in its new platform, and WMG did not return a request for comment. WMG’s artist roster includes Ed Sheeran, Fleetwood Mac and Madonna.
The startup’s current platform allows users to write text prompts and create songs using AI. The new version, which is expected to launch next year, will let users create remixes, covers and new songs with the voices of artists and the compositions of songwriters who choose participate and those artists and writers will be credited and paid, the companies said.
“This collaboration aligns with our broader efforts to responsibly unlock AI’s potential — fueling new creative and commercial possibilities while continuing to deliver innovative experiences for fans,” said Robert Kyncl, WMG CEO, in a statement.
WMG, Universal Music Group (UMG), Sony Music Entertainment and other music businesses sued Udio last year. In the lawsuit, Udio was accused of using hits like the Temptations’ “My Girl” to create a similar melody called “Sunshine Melody.” UMG owns the copyright to “My Girl.”
Udio said millions of people have used Udio since it launched in 2024, but did not break out specifically how many downloads or website users it has.
UMG settled with Udio last month. Udio declined to disclose the terms of the UMG settlement. The tech company also did not offer financial details about its platform collaboration with WMG, or which artists would be involved.
“Collaborating with WMG marks a significant milestone in our mission to redefine how AI and the music industry evolve together,” said Andrew Sanchez, co-founder and CEO of Udio, in a statement. “This partnership is a crucial step towards realizing a future in which technology amplifies creativity and unlocks new opportunities for artists and songwriters.”
The advancement of artificial intelligence in the arts has caused a range of emotions in the entertainment industry — from fear of job replacement to excitement over new ways to test bold ideas in music videos and music experimentation on slimmer budgets.
After the UMG-Udio deal was announced, Jordan Bromley, a board member at the nonprofit Music Artists Coalition and Manatt Entertainment Leader, said he was “cautiously optimistic but insistent on details.”
Music Artists Coalition executive director Ron Gubitz said the announcements on the agreements “lack critical details songwriters and performers deserve.”
“The question still remains whether these deals will deliver the most important things artists deserve: consent, clarity, and compensation,” Gubitz said in a statement.
Business
Commentary: Why are beef prices so high? Blame tariffs, drought and a disgusting parasite
It has become routine practice to turn to Trump administration spokespersons to learn how Democrats and illegal immigrants are the source of all our problems. The high price of beef? Check.
Here, for example, is Treasury Secretary Scott Bessent explaining for Fox News on Sunday why beef prices have been soaring:
“This is the perfect storm,” he said, “something we inherited.” (That’s the blaming the Democrats part.)
The beef segment remains our only soft spot.
— Tyson Foods CEO Donnie King
“Also,” he continued, “because of the mass immigration, a disease we’d been rid off in North America made its way up through South America as these migrants, they brought some of their cattle with them. So part of the problem is we’ve had to shut the border to Mexican beef.”
As is sometimes the case with Bessent, there’s a tiny nugget of truth in his words, surrounded by a bodyguard of misrepresentation.
The truth nugget is that the U.S. Department of Agriculture shut the border to Mexican cattle in March, in order to block the spread to the U.S. of the New World screwworm, a gruesome parasite that has been found in Central and South American herds.
But Bessent’s image of immigrants smuggling their infected beeves across the border is transparent fantasy. The USDA’s announcement of the blockade didn’t tie the screwworm peril to immigration, illegal or otherwise, but to commercial imports. The agency also stated that the infestation hadn’t yet penetrated farther north than Oaxaca and Veracruz, 700 miles from the U.S. border.
The Treasury Secretary’s spiel can properly be seen as standard Trumpian deflection.
That’s because at least some of the run-up in beef prices at the supermarket can be blamed on Trump policies, including his tariff on beef imported from Brazil, which has been a major exporter to the U.S. Trump himself implicitly acknowledged this Friday, when he announced that he was scrapping tariffs on beef and other foodstuffs to bring prices down.
Trump’s budget-cutting also has contributed to the crisis. Agriculture Secretary Brooke Rollins in June announced a “five-pronged plan” to combat the parasite south of the border. What she didn’t mention was that in March, the Trump administration cut off funding for anti-screwworm efforts operated by the U.N. Food and Agriculture Organization as part of its decimation of the U.S. Agency for international Development.
That said, much more is driving beef inflation than tariffs and the screwworm. And an examination of all the root causes indicates that things are likely to get worse at the meat counter before they get better. A recovery in beef prices, according to agricultural experts, may take years.
The root of the beef price problem: The size of the U.S. cattle herd peaked in 1975 and is now lower than it has been since 1951.
(USDA)
Before going further, let’s look at the raw numbers. It won’t be news to most shoppers that beef prices have been on a long-term ascent. The average price of uncooked beef steaks reached a record $12.26 per pound in September, up 15.2% from just before Trump took office.
That’s the tail of a long trend, however: The price was $3.64 in January 1998, according to the Bureau of Labor Statistics, meaning that it has more than trebled during a period in which the overall consumer price index merely doubled.
In recent months, major food processing companies have felt more than a slight pinch. Donnie King, chief executive of Tyson Foods, which owns such lunch meat and sausage brands as Hillshire Farms, BallPark, Jimmy Dean and Aidells, told investors at its fourth-quarter earnings roundup Nov. 10 that “the beef segment remains our only soft spot.”
The company reported an adjusted operating loss of $426 million on beef in fiscal 2025 and projected a loss of up to $600 million in the category for the 2025-26 fiscal year, in part because cattle costs had increased by $1.84 billion, a far larger cost increase than it experienced for any other input. It said that its earnings have been protected by gains in chicken, which has attracted shoppers shunning beef. Overall, for the fiscal year that ended Sept. 27, Tyson reported a profit of $507 million on revenue of $54.4 billion.
That brings us to the real factors driving beef prices higher. To a great extent, they’re secular. One is a long-term decline in the size of the U.S. cattle herd, which has fallen to about 87.2 million head of cattle and calves, its lowest level since 1951. Among the factors in that slide was a drought that struck the cattle-raising prairie states starting in 2020 and lasting through 2022. The all-time peak in the U.S. herd came in 1975, when it reached 132 million head.
Hay prices shot up by about 45% in 2022. With feed costs consuming the value of livestock, ranchers sold off their herds or stepped up the slaughter of their cows and heifers — producing a short-term glut of beef at store shelves but mortgaging their future supply.
Raising an animal from calf to marketable beef takes at least three years. Tyson executives told investors that they had seen signs that ranchers were finally rebuilding their herds, but that means a continued shortage of beef in the years just ahead.
Into this uncertain environment, Trump threw another complication: tariffs. These included a 50% levy on imports from Brazil, which Trump imposed in July not as a protectionist step, but because he was discontented with the prosecution of former Brazilian President Jair Bolsonaro for an alleged coup plot. (Bolsonaro was convicted and sentenced in September to more than 27 years in prison.)
That was a problem because, although foreign beef doesn’t account for a large share of overall beef consumption, it’s important for some categories, notably “lean beef trim,” which gets mixed in with fattier U.S. ground beef to yield the hamburger meat favored by American consumers. Brazil’s production of lean trim helped its beef exports reach more than 25% of all U.S. beef imports.
The long-term rise in beef prices has provoked market participants into a spate of finger-pointing, not all of which is groundless. In 2019, consumer advocates accused Tyson, Cargill and other meat-packers in a lawsuit of conspiring to fix beef prices. Tyson and Cargill settled the accusations against them last month without acknowledging guilt, Tyson paying $55 million and Cargill, $33.5 million. Two foreign-owned companies, JBS USA and National Beef Packing, are still in court.
Others have pointed to putative profiteering by cattle ranchers, whose profits per animal have spiraled higher, even as many have pared the size of their herds.
One might also point to American consumers, who haven’t moderated their beef buying enough to subject the commodity to the rigors of supply-and-demand economics.
The administration’s approach to the rise in beef prices has been chaotic and incoherent. Last month, Trump said he would alleviate the price spike by importing more beef from Argentina.
The proposal garnered instantaneous backlash from American cattle producers. They said the plan “only creates chaos at a critical time of the year for American cattle producers, while doing nothing to lower grocery store prices,” in the words of Colin Woodall, CEO of the National Cattlemen’s Beef Assn. The group noted that Argentina accounts for a bare 2% of U.S. beef imports, meaning that even a significant expansion of the trade flow would do little to moderate prices.
In sum, there’s little Trump can do to influence beef prices, except to make the situation worse, as happened because of his tariffs. Now that he has reversed course and lifted his thumb off the Brazil trade, prices might improve, if modestly. But all those other factors such as drought, the long-term decline in domestic herds and disease, will still be with us, for some time.
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