Toyota Sales Drop 1.9% in November as China Slumps

• Toyota’s global sales fell 1.9% and production dropped 3.4% in November 2025.
• A 12% sales decline in China, linked to subsidy cuts and diplomatic tensions, led the drop.

On December 25, 2025, The Japan Times reported that Toyota’s global sales and production experienced sharp declines in November 2025, with sales falling 1.9% and production decreasing 3.4%. The company attributed the downturn to a significant 12% sales slump in China, its largest foreign market.

Beijing’s recent decision to end subsidies for electric and fuel-efficient vehicles drove the decline in China. The subsidies had previously boosted consumer demand in the region, making their withdrawal a substantial challenge for automakers like Toyota. The timing of this policy change coincided with worsening diplomatic relations between China and Japan, triggered by public remarks from Japanese Prime Minister Sanae Takaichi concerning Taiwan. Following these remarks, Chinese authorities discouraged citizens from traveling to Japan, exacerbating tensions and impacting business relations.

Outside of China, Toyota’s production also dropped in other key markets. Factors such as a 9.7% production decline in Japan and a 7.9% decrease in the United Kingdom further contributed to the global slump. However, Toyota recorded notable production rises in Thailand (15%) and the United States (9%) during the same period. These gains, however, were insufficient to offset losses in other markets.

The Chinese automotive market is undergoing significant shifts, with local brands seeing rapid growth. Reports highlighted Huawei's Maextro S800 sedan’s strong performance in the high-end market, which outpaced established luxury competitors like the Porsche Panamera and Mercedes-Benz S-Class in sales above $100,000. Such shifts intensify competition for foreign automakers, including Toyota, in a market that has long been a key contributor to its global success.

This downturn occurs as the global auto industry navigates changing trade policies and regulations. For instance, the Trump administration in the U.S. is preparing new tariffs on imported vehicles, prompting Toyota to return certain U.S.-made models to Japan in an effort to mitigate trade tensions. Meanwhile, evolving European regulations on combustion engines and the continued rise of Chinese automotive brands add further competitive pressure to the global landscape.

Toyota’s challenges in November reflect a confluence of local and international issues, with the Chinese market slump standing out as the primary driver of its overall decline. The reduction in subsidies and escalating political tensions present significant hurdles in a region critical to the company’s operations and future growth.