Toyota has reduced its annual forecast by alerting an impact of ¥ 1.4 trillion ($ 9.5 billion) on its end result due to US tariffs that shook the global automotive industry.
The world’s largest car manufacturer now foresees an ¥ 3.2 trillion operating profit for the fiscal year ending in March 2026, he said on Thursday. This represents a drop in relation to the initial forecast of ¥ 3.8 trillion and was also below analyst expectations.
The automaker reported an ¥ 1.17 trillion operating profit in the first quarter, a 11% drop from the previous year, although it exceeded the analysts’ predictions, which expected ¥ 890 billion. While price increases in some regions helped this indicator, the impact of tariffs was ¥ 450 billion in the period.
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The perspective, which coincides with the beginning of President Donald Trump’s new tariffs, represents the automaker’s most complete report on the likely impact, as well as the previous estimate of an impact of ¥ 180 billion in April and May alone.
Toyota’s estimate surpasses recent predictions from large global companies, while the automotive industry deals with rapid change policies that are raising costs. Ford said last week that it provides a net impact of $ 2 billion tariffs, about $ 500 million more than the company previously expected. Meanwhile, Stellantis predicts that tariffs will reduce profits by about € 1.5 billion, and General Motors said its exhibition is between $ 4 billion and $ 5 billion.
Still, Toyota tends to adopt a conservative approach to its predictions and “recent trends suggest high potential, with Japan, North America and China leading the movement,” said Tatsuo Yoshida, senior car analyst at Bloomberg Intelligence. “Toyota seems to be working on initiatives to mitigate the weight of tariffs – such as reviewing its US vehicle supply chain.”
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Its forecast is also more pessimistic than that of its Japanese peers. Subaru estimates the impact of tariffs by ¥ 210 billion, Nissan predicts ¥ 300 billion and Honda anticipates ¥ 450 billion. Toyota’s shares fell up to 2.4% in Tokyo, before closing 1.5%.
Japanese automakers are now facing a 15% rate on vehicles sent to the US after the two countries close a trade deal last month that also includes Japan’s plans to create an American investment plan of $ 550 billion.
Although the rate is less than the additional 25% anticipated by the industry, there is still uncertainties about the details of the implementation – the tariff discounts for the EU, Japan and South Korea have not yet been formalized and, until that happens, the cars will face the highest charge.
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In July, in response to the deal, Toyota said he expects an improvement in US and Japan relationships, and ordered new tariff reductions.
Despite the turbulence, Toyota registered global sales records in the first half of 2025, thanks to the strong demand for its hybrids to gasoline in the main markets. It sold 5.5 million units between January and June, an increase of 7.4% over the previous year, mainly due to robust sales in the US, Japan and China.
The automaker expects sales of the group of 11.2 million this year. Toyota also plans to build a new vehicle factory in Aichi, Japan, with operations scheduled to start in the early 2030s, aiming to maintain domestic production in 3 million vehicles.
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