Toyota and Honda brace for profit drops as US tariffs, strong yen weigh
For Honda, the US accounted for around two-fifths of total sales in the first half of the year. Its global sales fell 5% over the period, dragged down by double-digit declines in China, Asia and Europe.
Toyota's global sales rose 6% over the period supported by strong demand for petrol-electric hybrids which typically carry higher margins than conventional petrol cars. Its Camry and Sienna hybrids remain strong sellers in the US.
The company has also performed better in China in recent months, posting a 7% year-on-year increase in vehicle sales over the first half of the year.
Honda said in May it was scaling back its investment in electric vehicles given slowing demand and would focus on hybrids with revamped models. It had earlier delayed plans to build an EV production base in Canada due to slowing demand for electric cars.
Investors will be looking for updates from the two companies on their pricing strategy and any revisions to full-year forecasts.
The Japanese carmakers have been taking measures such as transfer pricing to help alleviate the burden from the import tariffs, CLSA's Richter said.
Shares of Toyota are down 16% so far this year, while those of Honda are flat.
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