Sourcing comparison · Passenger Vehicles
Tariff & fee savings only, assuming equal product cost — your actual landed cost also depends on price and freight, which vary by supplier.
| Annual import value | Estimated duty & fee savings / year |
|---|---|
| $50,000 | $6,594 |
| $250,000 | $32,969 |
| $1,000,000 | $131,875 |
Savings scale linearly with volume. Enter your exact figure to model it precisely.
Calculate your exact volume →If your passenger vehicles currently ships from Canada, the duty bill is worth a second look. The effective rate falls from 27.5% on Canada shipments to 15% on Japan shipments — close to $13,187 per $100,000 of imports each year. Where a competitor's margin erodes on the same tariff, a buyer who re-sources keeps the difference. Read on for the full stack comparison, the policy reasons behind the gap, and a scaling table for your own volume.
On the Canada side, 5 of the 73 passenger vehicles lines owe an extra 50% under Section 338 (5 under HTSUS 9903.03.14). The Canada figure on this page leaves it out, so for those lines the gap to Japan is wider than shown.
Both stacks share the same customs valuation, so the comparison is apples to apples. From Canada, the entry is assessed a 2.5% Most-Favoured-Nation base duty and a 25% Section 232 measure on its passenger vehicles, an effective 27.5% once the $49.74 in processing fees are added. Sourced from Japan, the goods face a 2.5% Most-Favoured-Nation base duty and a 12.5% Section 232 measure on its passenger vehicles, an effective 15% once the $49.74 in processing fees are added. This category carries 25% of Section 232 from Canada and 12.5% from Japan; the gap between those two figures is part of what the saving measures. The Merchandise Processing Fee and Harbor Maintenance Fee are charged on customs value, not origin, so they sit at $49.74 on either stack and never contribute to the gap. The arithmetic difference between the stacks is $1,318.75 per $10,000 entry, all of it in the duty layers since the processing fees are origin-blind. That same per-dollar gap is about $3,297 on a $25,000 order and $13,187 on $100,000 of annual volume. Scaled to a single $25,000 PO, the gap is near $3,297, repeated on every reorder.
The category, HTS 8703, takes in Sedans, SUVs, Minivans, Electric vehicles, Luxury cars, Pickup trucks, and Crossovers among other passenger vehicles. Passenger Vehicles is a high-turnover category where landed-cost discipline separates the importers who hold margin from those who don't. A USMCA claim does not remove the Section 232 duty on passenger vehicles: a Canada or Mexico claimant pays it on full customs value, on top of the USMCA rate (U.S. note 33(a)). Commerce can approve an individual vehicle to pay it only on its non-U.S. content (note 33(d), heading 9903.94.03), but approval is per vehicle and this site does not model it. Partner agreements set a ceiling instead for some origins: Japan, the EU member states and South Korea pay a total of 15 percent including the column 1 rate, and the United Kingdom pays 7.5 percent on top of the column 1 rate within its annual quota (U.S. note 33(i), (k) to (s)). Based in North America, Canada is best known to US importers for crude oil petroleum, passenger vehicles, and lumber wood products. A USMCA claim on Canada-origin passenger vehicles outside the Section 338 annex replaces MFN with the USMCA rate, but the 25% Section 232 duty survives it and is charged on the full customs value. Based in Asia-Pacific, Japan is best known to US importers for passenger vehicles, auto parts components, and industrial machinery. For Japan, a negotiated bilateral rate applies on passenger vehicles entries alongside the base and Section 232/301 layers, now that Section 122 has lapsed to 0%. Different regions — North America versus Asia-Pacific — mean shipping economics deserve a look beside the tariff math. Japan is surfaced as a credible alternative, not just the cheapest line — it is among the origins a US buyer of passenger vehicles could realistically qualify. US tariff policy in 2026 is unusually fluid, with effective rates on many categories changing several times a year — a reason to treat any origin comparison as a live calculation rather than a fixed sheet.
For $100,000 a year of passenger vehicles, the move from Canada to Japan is worth about $13,187, scaling to $6,594 at $50,000, $32,969 at $250,000, and $131,875 at $1,000,000. The comparison is generated by running the same inputs through the tariff engine for each origin, which keeps everything but the duty layers equal. These figures reflect tariff and fee savings only, assuming equal product cost — your actual landed cost also depends on price and freight, which vary by supplier. Treat the annual saving as the ceiling on switching cost: as long as moving to Japan costs less than that, the change is accretive. Request parallel quotes from your Canada incumbent and a vetted Japan source, then compare landed cost with the duty gap held constant. Lock the comparison to a quote date; a surcharge added or lifted can change the ranking between negotiation and purchase order. Run your own volume — and a post-Section-122 view — through the interactive Tariff Savings Finder.
At $100,000 of annual import value, switching from Canada to Japan saves an estimated $13,187 in duties and fees, because the effective tariff rate falls from 27.5% to 15%. The saving scales linearly with volume. These figures reflect tariff and fee savings only, assuming equal product cost — your actual landed cost also depends on price and freight, which vary by supplier.
Japan-origin passenger vehicles is assessed a 2.5% Most-Favoured-Nation base duty and a 12.5% Section 232 measure, for an effective 15% duty rate before the Merchandise Processing Fee ($36.55) and Harbor Maintenance Fee ($13.19).
Canada carries an effective 27.5% rate versus 15% for Japan. The gap comes from differences in the base, Section 232 and bilateral rates that apply to each origin.
Tariff rates from Tax Foundation, USITC, and Penn Wharton Budget Model; retaliatory and industry data from the ITA Foreign Retaliations Database and U.S. Census Bureau (NAICS). Last verified .
