Toyota expects a $9.5bn hit from United States President Donald Trump’s tariffs on cars imported to the US, the largest of any company to date, underscoring growing margin pressures.

The world’s top-selling carmaker announced the forecast impact alongside its updated annual guidance on Thursday.

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Toyota also cut its forecast for full-year operating profit by 16 percent, reflecting challenges for global manufacturers grappling with rising costs from US levies on cars, parts, steel and aluminium.

“It’s honestly very difficult for us to predict what will happen regarding the market environment,” Takanori Azuma, Toyota’s head of finance, told a briefing, vowing to keep making cars for US customers, regardless of tariff impact.

Azuma said the 1.4-trillion yen ($9.50bn) estimate also includes fallout that suppliers are facing, particularly those in the US importing parts from Japan, though he declined to say how much of the total was attributable to that.

Toyota’s North American business swung to an operating loss of 63.6 billion yen ($431.3m) in the first quarter, from a profit of 100.7 billion yen ($682.9m) a year earlier, as it took a hit of 450 billion yen ($3bn) from the tariffs.

Its broad production operations, which include US, Canadian, Mexican and Japanese plants, expose it to tariffs not only on direct exports but also on vehicles and parts shipped across borders within North America.

Last week, the automaker said it turned out some 1.1 million Toyota and Lexus brand vehicles in North America in the first six months of 2025, including more than 700,000 in the US.

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Forecasts tumble

Toyota cut its operating profit forecast for the financial year to the end of March 2026 to 3.2 trillion yen ($21.7bn) down from a previous outlook of 3.8 trillion yen ($25.7bn).

It had previously estimated a tariff hit of 180 billion yen ($1.2bn) for April and May, but that was solely for the impact from tariffs on Toyota’s vehicles. It had not issued a full-year projection until now.

Rivals have reported smaller tariff hits so far: Jeep maker Stellantis said tariffs were expected to add $1.7bn in expenses for the year. General Motors (GM) has projected one of $4bn to $5bn for the year, while Ford expects a $3bn gross hit to pretax adjusted profit.

On Wednesday, Ford reported that second-quarter results took an $800m hit from tariffs.

Trade deals

The first-quarter results highlight the pressure US import tariffs are putting on Japanese automakers, even as a trade pact between Tokyo and Washington offers potential relief.

Under the deal agreed last month, Japanese auto exports into the US would face a 15 percent tariff, down from levies totalling 27.5 percent previously. But a timeframe for the change has yet to be unveiled.

Last week, Toyota reported record global output and sales for the year’s first half, driven by strong demand in North America, Japan and China, including that for petrol-electric hybrid vehicles.

The carmaker also announced on Thursday a plan to build a new vehicle factory in Japan, where car sales have been falling due to a shrinking population and declining ownership.

Toyota said it planned to start operations early next decade at the new plant, but has yet to decide production models.

On Wall Street, Toyota’s stock is on the decline amid its downward revised forecast. As of 11:30am in New York City (15:30 GMT), it is down by 1.6 percent. Competitors’ stocks are mixed. Ford is down 0.5 percent, Stellantis is up 2.4 percent and GM is up by about 0.7 percent.