Toyota makes seismic leadership change as tariffs eat into profits

If there's 1 happening American consumers love, it's Japanese cars.

According to World’s Top Exports count, astir 20% of the wealth U.S. consumers spent connected car imports successful 2024 went to Japanese car companies. The lone state with a higher percent was our next-door neighbor, Mexico.

Japanese automaker Toyota conscionable reported its third-fiscal 4th results. On the surface, it appears the institution counts the archetypal 3 quarters of its fiscal twelvemonth arsenic a win.

Still, the results whitethorn person outgo the company's CEO his job.

• GM: 2.83 cardinal vehicles (+5.1% twelvemonth implicit year); 17.3% market share

• Toyota: 2.52 cardinal vehicles (+8.4% YoY); 15.5% market share

• Ford: 2.18 cardinal vehicles (+5.6% YoY); 13.4% marketplace share

• Hyundai: 1.84 cardinal vehicles (+7.9% YoY); 11.3% marketplace share

• Honda: 1.42 cardinal vehicles (+0.6% YoY); 8.8% marketplace share
  Source: Cox Automotive

The Japanese automaker says it was capable to upwind the interaction of U.S. tariffs and thrust beardown request to accrued income volumes. But it was forced to trim sticker prices and summation selling efforts to marque that happen.

Toyota reported operating income of astir $21 cardinal done the archetypal 3 quarters of the year. It expects to extremity the fiscal twelvemonth with an operating nett of much than $24 billion. But that's $3 cardinal little than it reported done the archetypal 3 quarters of a twelvemonth ago, and its full-year projection is $6.4 cardinal beneath past year's.

Toyota says tariffs volition outgo the institution $9.23 cardinal successful fiscal 2025.

But it could person been worse.

In August, the Japanese authorities reported that its wide exports fell for the 4th consecutive month, including a 14% diminution successful automotive exports to the U.S.

However, the U.S. and Japan struck a woody successful precocious September that lowered Japan's tariff complaint to 15% from 25%. If that had not happened, Toyota's tariff measure could person been 10% higher.

On Friday, February 6, Toyota announced that existent CEO Koji Sato volition measurement down connected April 1, conscionable 3 years aft taking the job, to beryllium replaced by existent CFO Kenta Kon.

Sato volition modulation to the recently created relation of main manufacture serviceman and volition besides go vice president aft the demotion. Kon is simply a adjacent state of Toyota Chairman Akio Toyoda, according to Reuters, and helium is known for keeping costs low.

Related: Toyota's $26 cardinal woody could beryllium wounded by latest activistic move

• Mexico: 22.8%

• Japan: 18.6%

• South Korea: 17.3%

• Canada: 12.9%

• Germany: 11.7%

Kon served arsenic Toyoda's caput from 2009, the twelvemonth helium became CEO, until 2017, erstwhile helium was appointed caput of the accounting division.