Middle East Tensions Weigh on Earnings Outlook, Causing Toyota Shares to Plunge
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Glonghui, April 21 — Amid market concerns triggered by the impact of the Iran conflict on automotive supply chains and a clouded earnings outlook, Toyota's share price fell by as much as 2%, marking its largest drop in three weeks. Kyodo News reported on Monday that, affected by the ongoing conflict, Toyota will reduce production of pickups and other models destined for the Middle East market within the Asian region. In a research note, Nomura Securities analysts pointed out that the automotive supply chain is longer and covers more regions than other industries, making automakers especially vulnerable to supply chain disruptions. They stated: "Due to continued uncertainty such as component shortages, the sector is likely to face ongoing pressure. We maintain a cautious view on the overall automotive sector." They added that, in this financial reporting season, vehicle and component manufacturers may issue more conservative performance guidance.
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