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TOKYO: Mazda Motor announced on Tuesday that it expects a 145.2 billion yen ($987.02 million) impact on its operating profit this fiscal year due to U.S. import tariffs.

The Japanese automaker is implementing measures to mitigate the financial strain, including altering shipping routes, ramping up production at its Alabama plant, and adjusting output volumes.

Chief Financial Officer Jeffrey Guyton stated that the effect of higher U.S. duties remains “quite significant,“ with exports from Japan facing a 15% tariff and those from Mexico subject to 25%.

Without countermeasures, the company could face a 233.5-billion-yen operating profit loss for the year ending March 2026.

Mazda has been focusing on boosting sales of its CX-50 crossover SUV, manufactured at its Guanajuato plant in Mexico, which exports vehicles to the U.S.

The automaker reported selling approximately 210,000 vehicles in the U.S. during the first half of the year, a 4% increase from the previous year.

Despite the challenges, Mazda has projected a full-year operating profit of ¥50 billion for the fiscal year ending March 2026, a sharp decline from the previous year.

The company had earlier withheld financial guidance due to uncertainties surrounding U.S. tariffs.