# How war on Iran affects world economy beyond energy

- Link: https://www.tehranianonline.com/how-war-on-iran-affects-world-economy-beyond-energy/
- Published: 2026-05-24T01:16:01+03:30
- Author: Hassan Dehestani

The dramatic drop has effectively halted the flow of passenger cars, trucks and 
buses to West Asia – also a critical market for secondhand Japanese vehicles – following
the de facto closure of the Strait of Hormuz, according to finance ministry figures.

Contents

 * [Longer-term supply chain shifts expected](https://www.tehranianonline.com/how-war-on-iran-affects-world-economy-beyond-energy/#longerterm-supply-chain-shifts-expected)
 * [Why West Asia matters for Japanese automakers](https://www.tehranianonline.com/how-war-on-iran-affects-world-economy-beyond-energy/#why-west-asia-matters-for-japanese-automakers)

Government statistics show that West Asia accounted for approximately 14 percent
of Japan’s total motor vehicle exports in 2025.

Toshihiro Mibe, vice chairman of the Japan Automobile Manufacturers Association,
told reporters Thursday that the industry is absorbing the war’s impact primarily
through transport disruptions. “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 West Asia,” Mibe said.

He added that the association expects the disruption to remain largely confined 
to shipping, while authorities have confirmed sufficient supplies of chemical products
excluding naphtha and lubricants. The group will continue to monitor the situation.

## Longer-term supply chain shifts expected

Analysts say the war may compel automakers to restructure their supply chains over
the longer term as they seek to mitigate risks stemming from both the conflict and
the strait’s closure.

“This is not something that will end in the short term,” said Sanshiro Fukao, an
executive fellow at the Itochu Research Institute. “In the broader trend, as companies
take West Asia risk into account, the flow of goods could change.”

## Why West Asia matters for Japanese automakers

According to analysts, West Asia remains especially lucrative for Japanese car manufacturers
because it offers strong demand for high-margin models such as 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 West Asia accounting 
for about 6 percent of its total sales, it can absorb this hit better than others.”

While automakers may attempt to redirect some vehicles originally intended for West
Asia toward alternative markets, analysts caution they are unlikely to fully compensate
for the lost volumes.

Toyota, Nissan and other manufacturers are scheduled to release their April production
and sales figures next week.