Toyota cites tariffs as it forecasts 35% net profit drop
Tokyo: Japanese auto giant Toyota forecast on Thursday a 35 percent year-on-year drop in net profit for the current financial year, citing Donald Trump's vehicle tariffs among other factors.
Carmakers have been among the hardest hit by the US president's multi-pronged approach to trade. On top of a 25 percent tariff already placed on finished imported cars, the Trump administration on Saturday imposed a similar duty on auto parts, including engines and transmissions.
For the 2025-26 financial year that began in April, Toyota now forecasts net profit of 3.1 trillion yen ($21.6 billion).
"The estimated impact of US tariffs in April and May 2025 have been tentatively factored in," the world's top-selling automaker said in a statement.
The company logged a net profit of nearly 4.8 trillion yen in the 12 months to March 31, down 3.6 percent year-on-year but beating its earlier forecast of 4.5 trillion yen issued in February.
As of this month, Toyota estimated the tariffs would impact its 2025-26 operating profit by 180 billion yen.
Asked about the longer-term impact, Toyota President and CEO Koji Sato said the situation was "difficult to predict right now."
"US tariffs are currently being negotiated between governments, and details are still fluid," he added.
Toyota exports 500,000 vehicles annually to the United States from Japan, Sato noted.
"In the short term, we are adjusting shipments... while in the mid- to long-term, we will pursue the local development of products that suit local customers," he said, while maintaining the goal of producing three million vehicles annually in Japan.__ AFP
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