TOKYO – On Tuesday, Honda revealed a significant 42% decrease in profits for the nine-month period ending in December, attributing the decline to the impact of tariffs imposed by U.S. President Donald Trump, which have negatively affected the Japanese automaker’s financial performance.

Honda Motor Co., headquartered in Tokyo, reported that its profit for these three quarters amounted to 465.4 billion yen (approximately $3 billion), a sharp drop from the previous year’s 805.2 billion yen.

This marks the second consecutive year Honda, known for producing models like the Accord, Civic, and Odyssey, has experienced a profit decline during this timeframe.

Sales for the period slightly decreased by 2.2%, reaching 15.98 trillion yen (around $102.6 billion) compared to the prior year. Despite these setbacks, Honda maintained its full fiscal year profit forecast at 300 billion yen (about $1.9 billion).

Honda cited a downturn in the U.S. electric vehicle market as a contributing negative factor, although its motorcycle division demonstrated relatively strong performance, offering some financial relief.

In response to shifting market conditions, Honda has adjusted its global electric vehicle sales target for 2030, reducing it from an earlier estimate of 30% to 20%. The company also announced the cancellation of certain EV model developments.

The Trump administration, which has favored the oil and gas industry, has backpedaled on prior programs supporting the proliferation of EVs, dismantling programs that kicked in during the Biden administration, which had encouraged environmentally cleaner cars and trucks.

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.

Prime Minister Sanae Takaichi, who took office in October as Japan’s first female leader, scored a landslide parliamentary election victory for the governing party over the weekend. That’s expected to make it easier for her Liberal Democratic Party to push forward on its policies, including bolstering growth by boosting government spending, especially in technology and defense.

Honda stock jumped 2.1% in Tuesday’s trading. The Nikkei 225 benchmark finished 2.3% higher, renewing a record high for the second day straight, in a rally set off, in part, by Takaichi’s popularity.

___

Yuri Kageyama is on Threads: https://www.threads.com/@yurikageyama