FILE PHOTO: Honda vehicles are lined up at a vehicle storage yard at an industrial port, on the day U.S. President Donald Trump struck a trade deal with Japan that lowers tariffs on auto imports, in Yokohama, near Tokyo, Japan, July 23, 2025. REUTERS/Kim Kyung-Hoon/File Photo

By Tamiyuki Kihara

TOKYO (Reuters) -Japan and the United States are in the final stages of talks to implement lower tariffs on Japanese automobile imports within 10-14 days after the issuance of a U.S. presidential executive order, a Japanese government source told Reuters on Thursday.

That means that a reduced U.S. tariff rate on Japanese cars, from the current 27.5% to 15%, is set to take effect by the end of this month, said the source, who declined to be identified as the matter is confidential.

The exact date to be specified in the executive order is still under discussion, the source said, adding that the final decision would rest with U.S. President Donald Trump.

The U.S. embassy in Tokyo did not immediately respond to a request for comment. The Japanese government declined to comment.

The United States in July agreed to lower tariffs on imports of Japanese automobiles but the timing remains unclear as Trump has yet to sign an executive order.

Japan's top trade negotiator Ryosei Akazawa flew to Washington on Thursday to press the United States over issuing the executive order.

The executive order is also expected to include provisions that the 15% levy agreed in July would not be stacked on Japanese imports that are subject to higher tariffs, while items previously subject to less than 15% tariffs would be adjusted to 15%, the source said.

The two governments are working to include in the executive order some context on the tariff deal, including Japan's plans to expand U.S. rice imports and purchases of U.S.-made aircraft, according to the source.

A joint statement outlining the July agreement and a memorandum clarifying rules for Japan's planned $550 billion U.S.-bound investment package are also expected to be issued alongside the executive order.

The investment package, which will come in the form of equity, loans and guarantees from Japan's government-owned banks, was agreed as part of the July trade deal.

"The talks are now in their final phase," the source said. "Once Minister Akazawa arrives in Washington, the aim is to have the executive order issued swiftly. We will then move on to formulating plans to execute investment projects," he said.

(Reporting by Tamiyuki Kihara; Writing by Makiko YamazakiEditing by Gareth Jones)