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Denso estimates $720 million in extra costs by US auto tariffs

In this file photo, brand new cars sit in a lot near the Port of Richmond in California. (Getty/Kyodo)

NAGOYA (Kyodo) -- Denso Corp. said Tuesday U.S. tariffs on imported cars and auto parts, if invoked, could result in some 70 to 80 billion yen ($630 million to $720 million) in additional costs each year.

"It is a very worrying factor," Executive Director Yasushi Matsui of the Japanese auto parts supplier, a group company of Toyota Motor Corp., told a press conference. "We hope that fair trade rules will be maintained."

In May, U.S. President Donald Trump launched an investigation into whether auto imports have posed a threat to national security. The United States could reportedly slap additional tariffs of as much as 25 percent on automobile imports, up from the current 2.5 percent.

Matsui said U.S. import tariff hikes on steel and aluminum, already implemented earlier this year, are expected to raise annual costs by some 2 billion yen.

He added Denso could incur some 2 to 3 million yen in additional costs from the Trump administration's new tariffs targeting Chinese high-tech components and other goods because of the Asian country's alleged violation of intellectual property rights.

China and the United States are the world's first and second-largest auto markets, respectively.

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