TOKYO (Bloomberg) -- Toyota Motor Corp. forecast profit will fall from last year’s record as demand slumps in Japan, competition intensifies in the United States and the yen is no longer the boon it used to be.

Net income will probably slip to 1.78 trillion yen ($17 billion) in the fiscal year ending March 31, Toyota said in a statement today.

For the fourth quarter that ended in March, Toyota's net profit fell 5.4 percent to 297.0 billion yen. Net profit for the 12 months ended on March 31 grew an unprecedented 89.5 percent to 1.82 trillion yen as a weaker yen boosted the value of sales from Prius hybrids and Lexus vehicles exported from Japan.

As the currency edge fades, Toyota and Honda Motor Co. are predicting smaller-than-estimated earnings and are among Japanese automakers bracing for a record decline in domestic demand because of the nation’s first sales-tax increase in 17 years.

"The tailwind is over," Tatsuo Yoshida, a Tokyo-based automotive analyst for Barclays, said by phone before Toyota released its results. "Unlike in a usual year, we cannot assume flat sales or even growth in Japan because of the hangover from last fiscal year."

Toyota led a surge in the nation’s corporate earnings as Prime Minister Shinzo Abe’s economic policies helped weaken the yen by 8.7 percent against the dollar in the 12 months ending in March. In the year earlier period, the yen fell 12 percent.

As prospects dim for a further benefit from the yen, Toyota faces a number of challenges.

Safety defects have led to mounting global recalls, including one last month affecting more than 6 million vehicles to fix top sellers such as the Camry sedan and RAV4 SUV, and another involving 1.9 million Prius hybrids in February.

In March, Toyota agreed to pay a $1.2 billion penalty to end a U.S. criminal probe into sudden unintended acceleration problems with the company’s vehicles, which were tied to 10 million recalls in 2009 and 2010.

Toyota’s sales have increased in the United States at a slower pace than the total market in the first four months of 2014 as deliveries slipped 0.2 percent for the Camry, the top-selling car for the last dozen years. Sales of the Prius, which last underwent a major overhaul in 2009, have slumped 18 percent this year, putting the company on course for a second-straight year of lost market share.