By Daniel Leussink
TOKYO, May 21 (Reuters) – Japanese vehicle exports to the Middle East were nearly wiped out in April, government data showed on Thursday, as the U.S.-Israeli war on Iran disrupted shipping to a key region for global automakers like Toyota and Nissan.
The collapse suggests shipments of passenger cars, trucks and buses to the region, which is also a major destination for Japanese used cars, have largely ground to a halt following the effective closure of the Strait of Hormuz.
Motor vehicle exports to the Middle East plunged more than 90% in both value and volume terms from a year earlier, Ministry of Finance data released on Thursday showed, highlighting the auto sector’s exposure to shipping disruptions from the Iran war.
The region accounted for about 14% of Japan’s global motor vehicle exports in 2025, government figures showed.
Japan’s auto industry is feeling the hit from the war through transportation disruptions, said Toshihiro Mibe, a vice chairman of the country’s auto lobby, on Thursday.
“The biggest impact we’re seeing is from the closure of the Strait of Hormuz, which has led some manufacturers to reduce production of vehicles bound for the Middle East,” Mibe said.
The Japan Automobile Manufacturers Association expects the impact to be primarily limited to shipping, he said, adding that it would continue monitoring the situation and the government has said it secured ample supplies of chemical products other than naphtha and lubricants.
The war could push automakers to rejigger their supply chains over the longer term, as they seek to reduce risks related to the conflict and the strait’s closure, analysts said.
“This is not something that will end in the short term,” said Sanshiro Fukao, an executive fellow at the Itochu Research Institute, the think tank that is part of trading house Itochu, about supply and transportation disruptions caused by the war.
“In the broader trend, as companies take Middle East risk into account, the flow of goods could change,” he said.
A SHIFT TO INDIA
The war may accelerate a move by automakers to build their presence in India over the next three to five years and step up production and exports from there, Fukao said, as they seek to reduce shipping-related risks and costs.
Toyota said this month it would build a new factory with an annual output capacity of 100,000 vehicles in India.
The automaker said it will export cars made at the plant, which is slated to begin production in the first half of 2029, to other countries.
Analysts said the Middle East is particularly important for Japanese automakers because it is a profitable market with strong demand for high-margin models like Toyota’s Land Cruiser sport-utility vehicle.
“In terms of absolute sales, Toyota is the most exposed, as it is the most successful automaker in the region,” said Julie Boote, an auto analyst at Pelham Smithers Associates.
“However, since Toyota is regionally well diversified, with the Middle East accounting for about 6% of its total sales, it can absorb this hit better than others.”
While automakers may be able to divert some vehicles originally destined for the Middle East to other markets, they are unlikely to fully offset the lost volumes.
Toyota, Nissan and other automakers are set to release their April production and sales data next week.
(Reporting by Daniel Leussink; Editing by Thomas Derpinghaus)
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