Japanese automakers breathed a sigh of relief after U.S. President Donald Trump finalized a trade agreement last week. However, the relief is tempered by intensifying competition, especially from China,

T he U.S. and Japan have reached a trade agreement under which the longtime U.S. will face a 15% tariff—down from a previously threatened 25%—President Donald Trump announced on Tuesday, as Japan’s Prime Minister hailed the move as a “new golden era” in the relationship between the two countries.