(May 28): Toyota Motor Corp’s global sales posted their third straight month of year-on-year declines, as disruptions due to the Middle East conflict ripple across its business, with exports to the region down by more than 90%.
Global sales in April, including those of subsidiary Daihatsu Motor Co, fell 3.7% from a year earlier to 902,015 units, the company said on Thursday. Production, however, rose 3.4% to 933,685 units.
Toyota has weathered the conflict better than other carmakers, keeping factories running despite disrupted routes through the Strait of Hormuz. A longer squeeze fuelling shortages would test that resilience, exposing how deeply global automakers rely on Gulf-linked supplies for parts, materials and energy.
While demand remains strong, with customers waiting months for some models in major markets, Toyota’s sales also fell compared to last year when they were bolstered by a buying rush ahead of tariffs and the rollout of a new RAV4 sport utility vehicle model.
Sales in China, where market conditions remain challenging for Japanese carmakers, shrank 25%.
Exports to the Middle East slumped 92% year on year to 2,418 vehicles. At Toyota’s earnings announcement earlier this month, accounting chief Takanori Azuma said the manufacturer exports roughly 500,000 to 600,000 vehicles annually to the Middle East, and that it was assuming slightly less than half of that volume would be affected.
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At the time, Toyota forecast a surprise drop in profit for the fiscal year through March 2027 as it braces for higher raw material costs due to disruptions caused by the war in Iran. The outlook for ¥3 trillion in operating income fell short of analyst estimates, as well as the ¥3.8 trillion posted in the prior 12-month period.
Toyota’s suppliers had warned that they are beginning to see shortages due to the Iran conflict. The carmaker said it would be difficult to offset the resulting ¥670 billion hit to its bottom line from the regional turmoil.
On Monday, the Nikkei reported that Toyota plans to increase production cuts overseas to around 83,000 units due to logistical problems caused by regional tensions.
Uploaded by Evelyn Chan
