With the tariff situation in the US seemingly calming down a bit, Toyota has finally offered some insight on how much it will hurt the company’s bottom line.
Toyota estimates tariffs in the US will cost it ¥1.4 trillion ($14.5 billion) in this financial year, which ends March 2026. That’s up ¥1.2 trillion ($12.5 billion) from the previous financial year.
The US and Japan recently signed a deal, which will see tariffs on most Japanese imports, including cars and automotive components, reduced to 15 per cent, but it’s unclear when that will come into force.
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Toyota also operates three plants in Ontario, Canada, which make the RAV4, as well as the Lexus RX and NX. The company also has two factories in Mexico which produce the Tacoma ute.
Thanks to an on-going trade war started by President Trump, cars imported from Canada and Mexico are subject to a 25 per cent tariff on components that don’t meet the criteria set out in the United States Mexico Canada Agreement (USMCA) free-trade pact signed during President Trump’s first term.
With Toyota now confident enough to guesstimate how much tariffs will cost, it has issued a prediction for its full year profit, which it believes will fall to ¥3.2 trillion ($33.2 billion). That’s down ¥1.6 trillion ($16.6 billion) from the financial year that finished March 2025.
Toyota expects sales for the financial year to stay flat at 11.2 million vehicles, with Japan accounting for 1.5 million of those.
In its results for the April to June 2025 quarter, the company made a profit of ¥1.2 trillion, down 11 per cent from the same time last year.
Due to the tariff situation, North America posted a ¥21.1 billion loss, down from a ¥85 billion profit during the same period last year.
Toyota’s North American operations aren’t alone in suffering from tariff uncertainty.
Ford posted a US$36 million (A$55.9 million) loss in the April to June quarter despite record revenue numbers, and predicted it could lose around US$3 billion (A$4.66 billion) in tariff costs for the full year of 2025.
GM lost US$1.1 billion (A$1.68 billion) in the April to June quarter, blaming it all on the tariff situation.
Stellantis, the parent of Jeep, Ram, Dodge, Chrysler, Peugeot, Citroen, Fiat and others, recorded a €2.3 billion (A$4.1 billion) loss for the first half of the year, although most of that comes from restructuring and cancelling development programs.
The French-Italian-American automaker expects tariffs to cost it up to €1.5 billion (A$2.7 billion) for the full year.
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