Risk of a Loss of Domestic Economic Momentum

「The economic environment in the automotive industry surrounding our Group remained firm in terms of production volumes in Japan and overseas, although performance varied by market, while sales volumes were trending downward, partly due to the impact of US tariff measures.」

「The economic environment in the automotive industry surrounding our Group remained firm in terms of both production and sales volumes in Japan and overseas, although performance varied by market.」

「In Japan, automobile sales declined due to the suspension of shipments of certain vehicle models resulting from certification irregularities. Overseas, automobile sales generally increased, although performance varied by market. Meanwhile, persistently high raw-material prices, rising energy costs and logistics disruptions resulting from instability in the Middle East remain risk factors. In addition, the imposition of additional tariffs by the Trump administration has increased uncertainty in the North American business environment, raising the cost burden on automotive customers and suppliers and forcing a review of sales and supply-chain strategies.」

「In Japan, automobile production was affected by the suspension of shipments of certain vehicle models due to certification irregularities, but the impact of production cuts caused by semiconductor shortages also eased, and automobile production volumes increased from the previous fiscal year. Overseas, automobile sales generally increased, although performance varied by market. Meanwhile, in addition to high raw-material prices, persistently elevated energy prices resulting from the prolonged Russia-Ukraine conflict and sharp foreign-exchange fluctuations, heightened tensions in the Middle East could disrupt supply chains, and the outlook therefore remains uncertain.」

「In Japan, the alignment of public-health measures and economic activity progressed further, including the reclassification of COVID-19 as a Class 5 disease, and the economy entered a gradual recovery trend against a backdrop of growing inbound demand. However, in addition to inflation, including yen depreciation driven by the widening interest-rate differential between Japan and the United States and surging energy prices, uncertainties increased, including the impact on prices from heightened tensions in the Middle East, and the outlook remains uncertain.」

「Uncertainty increased due to inflationary pressures including further yen depreciation caused by the widening interest-rate differential between Japan and the US and rising energy prices, as well as the impact on prices of heightened tensions in the Middle East, and the outlook remained uncertain.」

「Regarding the economic environment surrounding the Group in Japan during the second quarter cumulative period, progress in balancing COVID-19 containment with economic activity advanced further, including the reclassification of COVID-19 to Category V under Japan's legal framework, and the economy entered a gradual recovery trend centred on personal consumption. However, uncertainty increased due to factors including further yen depreciation caused by the widening interest-rate differential between Japan and the US, rising energy prices and other inflationary pressures, as well as the impact on prices of heightened tensions in the Middle East, and the outlook remained uncertain.」

「Regarding the domestic economic environment surrounding the Group during the first quarter cumulative period, progress in balancing COVID-19 containment with economic activity advanced further, including the reclassification of COVID-19 to Category V under Japan's legal framework, and the economy entered a gradual recovery trend centred on personal consumption.」

「Regarding the economic environment surrounding the Group during the third quarter cumulative period, progress was made in Japan in balancing COVID-19 containment with economic activity, and economic normalisation advanced further. However, supply-chain stagnation due to semiconductor shortages and other factors, along with price increases for various consumer goods caused by higher raw material prices and yen depreciation, continued, increasing concern about the economic outlook.」

「In Japan, progress was made in balancing COVID-19 containment with economic activity, and economic normalisation advanced further. However, supply-chain stagnation due to semiconductor shortages and other factors, along with price increases for various consumer goods caused by higher raw material prices and yen depreciation, continued, increasing concern about the economic outlook.」

「During the consolidated fiscal year, the impact of the spread of COVID-19 that had continued from the previous year began to subside, but the impact of production cuts by automakers due to supply-chain problems, including semiconductor shortages and disruptions to maritime transportation networks, became pronounced from the second half.」

「During the third quarter cumulative period, the impact of the spread of COVID-19 continued into the first half, and although the state of emergency was lifted in October as vaccinations progressed, the outlook remained uncertain as infections, including new variants, spread again.」

「During the second quarter cumulative period, Japan's economic environment was affected by voluntary restraints on economic activity under the state of emergency and priority preventive measures to prevent the spread of COVID-19, which affected corporate activity. However, the economy overall continued on a gradual recovery trend, partly due to the effects of expanded vaccinations and other factors.」

「The overall supply chain also became unstable due to disruptions in global logistics networks and shortages of automotive semiconductors and raw materials, affecting the Group's business results and performance.」

「During the third quarter cumulative period, Japan's economy fell sharply as the spread of COVID-19 restricted personal consumption and corporate activity. Some economic activity gradually began to recover and signs of a rebound emerged, but the recovery paused as infections including new variants spread again, and a state of emergency was declared again in some prefectures in January, leaving the outlook uncertain.」

「During the second quarter cumulative period, the Japanese economy deteriorated rapidly as personal consumption and corporate activity were severely restricted by requests to refrain from going out and suspend operations due to the spread of COVID-19, as well as the declaration of a state of emergency in April and its expansion to additional regions. Although the state of emergency was lifted, the outlook remained uncertain amid the continuing risk of infection.」

「During the first quarter cumulative period, the Japanese economy deteriorated rapidly as personal consumption and corporate activity were severely restricted by requests to refrain from going out and suspend operations due to the spread of COVID-19, as well as the declaration of a state of emergency in April and its expansion to additional regions. Although the state of emergency was lifted, certain restrictions on economic activity and voluntary restraint continued amid the remaining risk of infection, and the outlook remained uncertain.」

「The outlook for the domestic economy is becoming more uncertain, as corporate earnings have shown signs of weakening and inbound consumption has paused, while there has also been a reactionary decline in demand following the consumption tax rate increase.」

「Uncertainty about the outlook is increasing, with the risk of a downturn in the economy rising due to a pause in inbound consumption and sluggish growth in real income, among other factors.」