Mazda Motor Corp. posted a ¥46.1 billion ($319 million) operating loss in its fiscal first quarter as new US import tariffs battered the Japanese automaker’s trade-dependent business model.
The Hiroshima-based company swung from a ¥50.4 billion profit in the same period last year, with tariffs alone expected to slash ¥145.2 billion ($987 million) from full-year operating profit. Net sales fell 8.8% to ¥1.1 trillion, while the company reported a ¥42.1 billion net loss.
Mazda imports roughly 55% of its US sales from Japan, including the CX-5 crossover and CX-70 and CX-90 SUVs, making it more vulnerable to trade disruptions than rivals Toyota and Honda. The company also faces tariffs on vehicles produced at its Mexico plant.
Chief Financial Officer Jeffrey Guyton acknowledged the “quite significant” impact, estimating exports from Japan face a 15% tariff while those from Mexico encounter 25% duties. Without countermeasures, the company warned of a potential ¥233.5 billion profit hit.
Mazda’s response includes boosting production at its Alabama plant, adjusting shipping routes, and targeting cost reductions of ¥80 billion through variable and fixed cost cuts. The company plans to offset more than 60% of the tariff impact while maintaining global sales volumes near last year’s levels.
Global vehicle sales declined 2.8% to 301,000 units in the quarter, with European sales falling 21% due to model transitions. Despite the challenges, Mazda maintained its full-year operating income forecast of ¥50 billion, down 73% from the previous year.
The company’s stock has been under pressure as investors weigh the sustainability of its import-heavy strategy against evolving US trade policies.
