Full Breakdown
Iran War Sends Shockwaves Through Global Industries
5/8/2026, 10:25:51 PM
War Outbreak and Immediate Shock
U.S.-Israeli attacks on Iran began on 28 February 2026, prompting Iran to keep the Strait of Hormuz closed. The blockade lifted a key oil route, pushing fuel prices above $4 per gallon and raising transport and raw-material costs worldwide.
Data & Statistics
Toyota’s war-related loss totals 670 billion yen (400 billion yen material costs, 270 billion yen sales loss). The firm sold 9.6 million vehicles, including 600 000 battery cars. UK construction input-cost inflation reached its highest level since 2022, with the PMI falling to 39.7 in April.
Automotive Sector: Toyota
Toyota warned operating income will fall to 3 trillion yen, marking a profit decline. The war’s material-cost surge and lower sales created a 670 billion-yen impact, with the company saying it is “likely unable to absorb newly added impact from the Middle East.” Hybrids account for half of 9.6 million units sold, while battery-electric sales rose to 600 000.
U.S. Consumer Shift: Hybrid Sales
Fuel price spikes drove a 37 % surge in U.S. hybrid sales in the two months after the war began, outpacing the market’s 15 % growth. EV sales rose 11 % but lagged demand, showing a consumer shift toward fuel-efficient models despite continued strong demand for large pickup trucks.
Retail Response: Next
Next expects £47 million in war-related costs and may raise prices up to 8 % in markets outside Europe. Currency gains and internal savings will keep UK and European price changes below 1 %. The retailer, with 700 stores and brands such as FatFace, lifted its full-year profit forecast to £1.22 billion.
Construction Industry Impact
UK construction firms saw the steepest input-cost rise since 2022, with the PMI dropping to 39.7 in April. Higher expenses were linked to fuel-price spikes and raw-material hikes from the Hormuz blockade. Housebuilders Crest Nicholson and Berkeley issued profit warnings; Travis Perkins recorded a 1.7 % revenue decline.
Criticism & Opposition
Pandora CEO Berta de Pablos-Barbier told BBC Radio 4 that “consumer confidence is not that high today,” noting high inflation and interest rates.
Official Statements & Responses
Toyota’s chief accounting officer said the firm cannot fully offset the 670 billion-yen Middle East impact. Next’s spokesperson noted currency gains offset cost increases, avoiding UK price hikes. Tim Moore of S&P Global highlighted rapid acceleration of input-cost inflation in April. Travis Perkins called the quarter “challenging” amid subdued construction activity.
Verbatim Quotes
- “We do not believe we can fully offset negative 670bn yen Middle East impact.” — Takanori Azuma, chief accounting officer, Toyota
- “Tim Moore, the economics director at S&P Global Market Intelligence, which compiles the PMI survey, said: “A rapid acceleration of input cost inflation was seen across the UK construction sector in April.” — Tim Moore, economics director, S&P Global Market Intelligence
- “challenging”, with revenue down 1.7%, “as construction activity levels remain subdued”. — Travis Perkins, UK’s largest builders’ merchant
- “cost increases have been offset by currency gains, so there is no need for price increases” — Next spokesperson
What’s Next
Negotiations to reopen the Strait of Hormuz continue, while firms monitor fuel-price trends, adjust pricing, and reassess investment amid persistent cost pressures.
