Toyota Motor Corp. and Nissan Motor Co. are preparing to announce their financial results, offering insight into the difficulties faced by Japan's auto industry due to a decrease in global demand and production cuts.

The companies are contending with heightened competition, particularly from Chinese automakers, who have been steadily increasing their market share in emerging markets. In Thailand, for example, Chinese electric vehicle manufacturer BYD has achieved an impressive 40% of total EV sales, while Japanese brands make up less than 1%. This shift underscores the growing dominance of Chinese rivals in the automotive sector, causing concerns for traditional Japanese carmakers as they navigate a rapidly evolving market landscape.