While President Donald Trump was touting his new trade deal with the U.K. and sending representatives to Switzerland to begin talks with China, Japan’s largest automaker, Toyota, revealed that the tariffs he imposed will cost it at least $1.25 billion in April and May.
The Wall Street Journal reported that through the end of March, Toyota made 3.2 million vehicles in Japan and exported about 542,000 to the United States.
Unbiased. Straight Facts.TM
Toyota has been the world’s top-selling automaker for five straight years, according to Reuters.
How much is Toyota paying when it comes to tariffs?
The Trump administration set a 25% tariff last month on foreign-made cars coming into the country. Despite that, Toyota Chief Financial Officer Yoichi Miyazaki said the company will not raise prices in the United States.
Toyota was the world’s largest carmaker in 2024, selling 10.8 million vehicles. In order to sell cars in the U.S., Toyota and other Japanese automakers make cars in Japan, as well as Mexico, and export them to the United States. They also produced some vehicles at American plants and might face higher labor costs if they decide to expand in the U.S.
What is Toyota saying about the future?
Toyota said profits for the first three months of 2025 dropped by 33% compared to 2024.
Toyota Chief Executive Officer Koji Sato said that tariffs are fluid and make predicting the future difficult, according to the Wall Street Journal.
Sato said Toyota will continue to develop and manufacture cars based on where its customers are located.
He talked about the importance of Toyota maintaining its position in Japan as well.
“It’s critical to protect domestic production,” Sato said.
The Journal noted that Toyota’s stock price is down 15% this year due to concerns about the new U.S. tariffs. Higher costs of materials are also expected to negatively affect profits.
“Whether these tariffs are permanent or not, and what will happen is not something we can decide,” Sato said.
Some economists and analysts believe the tariffs on vehicles will lead to rising prices in this country for car buyers. In addition, a reduction in consumer confidence and sentiment could also affect the auto industry going forward.
