The following is excerpted from the question-and-answer section of the transcript.
(Questions from industry analysts are provided in full, but answers are omitted - download the transcript to see the full question-and-answer session)
Question: Michael Hassan - Nomura Securities - Analyst
: This is Michael from Nomura Securities. Thank you very much for the presentation. First question is about page 7. Volume product mix which is
JPY10.3 billion negative. Can you give me the breakdown?
Question: Michael Hassan - Nomura Securities - Analyst
: I have two additional questions. The decline in mining for North America, didn't that have an impact on the mix? And you said minus JPY3.1 billion
for one-off factors. Can you give me more detail on that?
Question: Michael Hassan - Nomura Securities - Analyst
: My second question is about tariffs. The latest forecast. First, for the inventory part. It has declined Tax rate revision, steel and aluminum, this is not
attributed to external factors, I guess. When you crunch the numbers, you didn't have that much of inventory and the P&L impact this time around
-- even if the rates changes, it hasn't really changed. So regarding the trends of inventory, can you give us more commentary?
Question: Michael Hassan - Nomura Securities - Analyst
: So, if you were to point it out, what part was different? Or Were there less inventory that you were able to ship? Can you give me more flavor on
that?
Question: Michael Hassan - Nomura Securities - Analyst
: Understood Also, for steel and aluminum, it's going to increase and for reciprocal tariffs, it's Positive and negative. So the remaining portion is the
rates between US and China. And I guess the reciprocal tax portion was going to be greater because Japan went down.
But regarding the tariffs, steel, aluminum and others from JPY140 billion, it went down to JPY110 billion, but how much do each of these factors
contribute? Because then we'll be able to get a better idea. Can you walk us through additionally with, numbers, hard numbers?
Unidentified Company Representative
Well, regarding tariffs between US and China. At the time of the April public announcement. We were assuming 145%. But with the agreement
reached, it was 30% until August and from September, 54%. Therefore, this difference is pretty big. Also, for steel and aluminum. This mix It's kind
of spread out, so it's hard to pinpoint where, but I would say on a relative basis, it's higher in Japan as well as in China.
And for reciprocal [path]. Japan has the largest impact. And it says, or it's JPY13.5 billion under others, but the majority of this is attributed to Japan.
So for JPY13.5 billion-plus for tariffs on steel and aluminum, 25% went up to 50%. So, the original JPY13.5 billion, did it double, go up to JPY27
billion, and that's why it's up by JPY13.5 billion.
And for reciprocal tax, I assume that it should be around JPY100 billion, but it's only down by JPY13.5 billion and it seems that that's very small. So,
is that the right way to look at this volume wise? Well, the JPY110 billion, based off the JPY110 billion. About half of that is associated with reciprocal
tariffs. About JPY30 billion is steel and aluminum.
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