Honda is reeling from Trump's tariffs, as latest report shows major blow to Japanese automaker

"Honda reported Tuesday a 42% drop in profit for the nine months through December, compared to a year earlier, as U.S. President Donald Trump's tariffs hurt the Japanese automaker's earnings.Tokyo-based Honda Motor Co.'s profit over the three quarters totaled 465.4 billion yen ($3 billion), down from 805.2 billion yen.That marked the second straight year that profit declined during the period at Honda, the maker of the Accord sedan, Civic compact and Odyssey minivan."

"The slowdown in electric vehicles in the U.S. market was one negative factor, according to Honda, while the relatively healthy performance in its motorcycle division worked as a plus.Honda lowered its global EV sales ratio projection for 2030 to 20% from its previous target of 30%. It also said it canceled the development of some EV models, because the EV market was changing."

"Last year, Trump lowered the tariffs on automobiles and auto parts to 15% from an earlier 25% that he had initially announced. Japan promised to invest $550 billion in U.S. projects.Tariffs are a major blow to Japan's export-reliant economy, including the automakers. Last week, Japan's top automaker Toyota Motor Corp. reported a decline in recent profit, and announced that its chief financial officer, Kenta Kon, will become its new chief executive and president."

Honda's profit for the nine months through December fell 42% to 465.4 billion yen from 805.2 billion yen a year earlier. Sales for the period dipped 2.2% to 15.98 trillion yen. Honda maintained its full fiscal-year profit forecast at 300 billion yen. U.S. electric vehicle demand slowed and weighed on results, while motorcycle sales remained relatively healthy. Honda lowered its global EV sales ratio projection for 2030 to 20% from 30% and canceled development of some EV models. Tariff changes and shifting U.S. EV policies affected automakers, and Toyota also reported profit declines and leadership changes. Prime Minister Sanae Takaichi won a recent landslide parliamentary victory.

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