Toyota Motor Corp. and Honda Motor Co. earnings will paint a mixed picture as a stronger yen and US auto tariffs eat into profit, despite resilient unit sales.
Toyota likely saw a dip in first-quarter operating profit, according to estimates. While the company posted record global sales in the first half driven by a surge in pre-tariff purchases, the automaker is likely weighed down by factors including supply chain costs.
Honda’s profits likely fell for the same reasons, according to Bloomberg. In June, Japanese automakers slashed US-export prices by 19 percent, the biggest drop since records going back to 2016, sacrificing margins to remain competitive through the tariff turmoil.
Japanese Defense sector will also be in focus, as rising government spending will support sales and margin growth at Mitsubishi Heavy Industries Limited and Kawasaki Heavy Industries Limited.
Tariff-related pressures are expected to weigh on Kawasaki Heavy power-sports segment, while its defense unit is projected to drive margin expansion, said an analyst.
Profit margins at Mitsubishi Heavy’s aircraft, defense and space business could exceed targets, supported by a gradual recovery in Boeing 787 production.
