Toyota Cuts Full-Year Profit Forecasts on Trump Tariffs

Tokyo, Aug. 7 (Jiji Press)--Toyota Motor Corp. on Thursday lowered its consolidated profit forecasts for fiscal 2025, reflecting high tariffs imposed by the administration of U.S. President Donald Trump.

For the year to next March, the leading Japanese automaker projects a net profit of 2.66 trillion yen, down from the previously forecast 3.1 trillion yen. Its annual net profit is now expected to shrink for the second straight year.

Toyota cut its operating profit forecast to 3.2 trillion yen from 3.8 trillion yen as Trump's tariffs are estimated to have a negative impact of 1.4 trillion yen, although the company expects to improve the operating balance by 899.5 billion yen through higher automobile sales and cost reductions. The yen's rise and higher material prices are also seen weighing on the group's earnings.

Meanwhile, Toyota kept its consolidated operating revenue estimate unchanged at 48.5 trillion yen, with the group's global vehicle sales projection maintained at 11.2 million units, including sales at subsidiaries Daihatsu Motor Co. and Hino Motors Ltd., on the back of robust sales in the North American market.

"Sales in North America continue to have strong momentum," Hiroyuki Ueda, chief officer of Toyota's External & Public Affairs Group, said while noting that there was a rush in demand ahead of the introduction of the U.S. tariffs.

Takanori Azuma, chief officer of the automaker's Accounting Group, indicated that Toyota, in light of the impact of the U.S. tariffs, will consider revising prices in the United States if there is an appropriate timing.

Toyota plans to increase production in the United States in the medium to long term.

Azuma said that Toyota aims to continue producing at least three million vehicles in Japan a year by taking measures to rev up demand.

The firm kept its assumed exchange rates unchanged at 145 yen to the dollar and 160 yen to the euro.

For the April-June first quarter of fiscal 2025, Toyota reported the same day a group net profit of 841.3 billion yen, down 36.9 pct from a year before, posting the first decline in three years. Operating revenue grew 3.5 pct to 12,253.3 billion yen.

Operating profit fell 10.9 pct to 1,166.1 billion yen partly because of the impact of the U.S. tariffs, which is estimated to have totaled 450 billion yen, as well as the stronger yen. The Toyota group's business in North America fell into the red despite a rise in sales.
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