TOKYO (AP) — Honda reported Tuesday a 42% drop in profit for the nine months through December, compared to a year earlier, as U.S. President Donald Trump’s tariffs hurt the Japanese automaker’s earnings.

Tokyo-based Honda Motor Co.’s profit over the three quarters totaled 465.4 billion yen ($3 billion), down from 805.2 billion yen.

That marked the second straight year that profit declined during the period at Honda, the maker of the Accord sedan, Civic compact and Odyssey minivan.

Sales for the three quarters dipped 2.2% to 15.98 trillion yen ($102.6 billion) from the previous year. Honda stuck to its full fiscal year profit forecast at 300 billion yen ($1.9 billion).

The slowdown in electric vehicles in the U.S. market was one negative factor, according to Honda, while the relatively healthy performance in its motorcycle division worked as a plus.

Honda lowered its global EV sales ratio projection for 2030 to 20% from its previous target of 30%. It also said it canceled the development of some EV models, because the EV market was changing.

The Trump administration, which has favored the oil and gas industry, has backpedaled on prior programs supporting the proliferation of EVs, dismantling programs that kicked in during the Biden administration, which had encouraged environmentally cleaner cars and trucks.

Last year, Trump lowered the tariffs on automobiles and auto parts to 15% from an earlier 25% that he had initially announced. Japan promised to invest $550 billion in U.S. projects.

Tariffs are a major blow to Japan’s export-reliant economy, including the automakers. Last week, Japan’s top automaker Toyota Motor Corp. reported a decline in recent profit, and announced that its chief financial officer, Kenta Kon, will become its new chief executive and president.

Prime Minister Sanae Takaichi, who took office in October as Japan’s first female leader, scored a landslide parliamentary election victory for the governing party over the weekend. That’s expected to make it easier for her Liberal Democratic Party to push forward on its policies, including bolstering growth by boosting government spending, especially in technology and defense.

Honda stock jumped 2.1% in Tuesday’s trading. The Nikkei 225 benchmark finished 2.3% higher, renewing a record high for the second day straight, in a rally set off, in part, by Takaichi’s popularity.

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Yuri Kageyama is on Threads: https://www.threads.com/@yurikageyama

Yuri Kageyama, The Associated Press