Profit at Japanese car manufacturer Toyota have fallen by 15 per cent in its first quarter due to a stronger yen and stalling US sales.
Full-year earnings forecasts have also been lowered to 1.45 trillion yen (£10.8bn) for the financial year ending in March 2017, down slightly from the May forecast of 1.5 trillion yen.
Revenue over the three month period fell 5.7 per cent to 6.6 trillion yen as sales softened in the US and Japan.
The value of the yen has risen due to global economic uncertainty and the yen’s reputation as a safe haven in times of crisis.
The yen has strengthened by almost 20 per cent against the dollar this year. This makes Japanese products more expensive on international markets and can weigh on sales.
In the US poor sales of Toyota’s electric hybrid Prius have also been blamed on lower petrol prices. Sales in the US dropped four per cent compared with the same period a year earlier.
In Europe, vehicle sales totalled 222,100 units, up by 16,300.
“Despite the positive factors such as cost reduction efforts and marketing efforts, operating income was down 113.7bn yen compared to the first quarter of the last fiscal year, due to the significant impact of yen appreciation,” said Toyota managing officer Tetsuya Otake.