Honda Motor and Toyota Motor, two major Japanese automakers, reported substantial declines in their first-quarter net profits due to the impact of U.S. tariffs on imported vehicles imposed under President Donald Trump. Honda's first-quarter operating profit fell by 50%, affected by the tariffs and a stronger yen, though the company raised its full-year profit forecast. Toyota experienced a 37% drop in first-quarter net profit to ¥841.3 billion ($5.7 billion), exceeding analyst expectations despite the decline. The company attributed the decrease to the 25% U.S. tariff on automobiles, higher material costs, and currency fluctuations. Consequently, Toyota cut its full-year operating profit forecast by 16%, anticipating a nearly $9.5 billion hit from the tariffs. The revised annual net profit forecast stands at approximately ¥2.66 trillion ($18.06 billion), reflecting a 14% reduction from previous estimates. Toyota also projected a decline in operating margin to 6.6% for the fiscal year ending March 2026, down from an earlier forecast of 7.8% and well below the 10% margin recorded in fiscal 2025. These tariff-related challenges have contributed to a broader 12% decline in net profits among Japanese companies, compounded by the strong yen.