Toyota saw sales decline in March as demand dipped for its best-selling RAV4 ahead of the refresh of the SUV, while the conflict in Iran threatens to cut off key supplies and force manufacturers to dial back production.
Global sales in March — including those of subsidiaries Daihatsu and Hino — fell 5.8% from a year earlier to 983,126 units, the company said Monday.
So far, the company has been able to keep churning out cars, with worldwide production climbing 3.9% to 1.02 million units.
The numbers show how the world’s biggest carmaker has been able to remain on track despite turmoil in the Middle East, which has raised the price of aluminium and other raw materials and the underlying costs for automobile parts.
Production may be due for further declines, with Japanese carmakers depending on the region for roughly 70% of their aluminium.
Despite the higher output figures last month, Toyota and Nissan have already warned of cuts. Production of Toyota-brand vehicles in Japan fell 3.3% in March.
Suppliers have been bracing for a prolonged shortage that’s likely to persist for months even if the Strait of Hormuz is reopened and shipments return to normal.
Refineries will take time to get back online, and shipping companies will need to unclog a bottleneck of hundreds of ships stuck in the Persian Gulf.
The ongoing conflict has affected Japan’s monthly vehicle output by about 20,000 units, major supplier Denso said in March.
The figures also show that Toyota is making progress in boosting sales of all-electric vehicles, with volumes more than doubling in March to 35,524 units.
Hybrid gasoline-electric vehicles also continued to perform well, with sales climbing 3.7% to 442,544 units in March.
Even so, Toyota’s resilience stands out in an auto industry squeezed by tariffs, rising competition and uncertainty about the global EV transition.
As rivals warn of billions in added costs and seek to raise prices or shift production, Toyota has kept its title as the world’s top carmaker in 2025 by selling 11.3 million units, after widening its lead over Volkswagen.
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