Trump tariffs deliver blow to Japanese automakers' outlooks

Some said that the Trump tariffs are expected to cost them several hundred billion yen in terms of operating balance for the year through March 2026.

Also hurt by the yen's strength and intensifying competition in vehicle markets, four of Japan's seven major automakers, most notably Toyota Motor Corp., predict net profit drops.

The other three, including Nissan Motor Co., opted not to announce their forecasts for the time being, citing uncertainties linked to the tariffs.

"We'll end up losing a considerable amount of profit if we don't act," Subaru Corp. President Atsushi Osaki said.

According to Osaki, the U.S. tariffs are expected to cost the company 2.5 billion dollars, or about 370 billion yen, for the current fiscal year.

Toyota has said that the tariffs will lower its operating profit by 180 billion yen in April and May alone.

Even Suzuki Motor Corp., which does not sell passenger vehicles in the U.S. market, said that the Trump tariffs are expected to cut its profit by 40 billion yen.

"U.S. tariffs are a global issue," Suzuki President Toshihiro Suzuki said. "We need to brace ourselves for a recession to some extent."

Automakers plan to minimise the tariff-related impact by cutting costs and boosting their plant operations in the United States.

Honda hopes to reduce the impact by about 200 billion yen from the initially estimated 650 billion yen. Over the medium term, it will consider revising auto prices and increasing capital investments in the United States.

Already reeling from stagnant sales in the U.S. and Chinese markets, Nissan expects an additional blow from the tariffs.

The struggling automaker only announced its sales forecast for fiscal 2025, saying that its other profit or loss predictions are "yet to be determined."

Aiming to change its high-cost structure, Nissan plans to shut seven plants in Japan and overseas and cut 20,000 jobs, or 15 pct of the group's workforce.

For the year that ended in March this year, Nissan posted a consolidated net loss of 670.8 billion yen, against the previous year's profit of 426.6 billion yen.

Toyota and four other automakers suffered profit drops.

Meanwhile, Suzuki was the only one to enjoy profit growth, thanks to strong auto sales in Japan and the Near and Middle East markets.

 [Copyright The Jiji Press, Ltd.]