Honda reported Wednesday a significant 8.7% rise in profit for the April-June quarter, fueled by robust sales of hybrid vehicles in Japan and the U.S., along with motorcycles in India and Brazil. The Japanese automaker’s earnings for the quarter reached 394.7 billion yen ($2.7 billion), up from 363 billion yen the previous year. Quarterly sales surged nearly 17% to 5.4 trillion yen ($36.7 billion).
The company benefited from a favorable currency exchange rate, which added nearly 48 billion yen ($326 million) to Honda’s quarterly operating profit. Despite stiff price competition in China, Honda, the maker of the Accord sedan, Fit subcompact, Super Cub motorcycle, and Asimo robot, managed to stay afloat.
Honda’s chief financial officer, Eiji Fujimura, cautioned that the currency effect remains unpredictable but highlighted Honda’s commitment to delivering the right products to varied markets, enabling it to stay relatively resilient despite currency fluctuations. The U.S. dollar traded above 150 yen in the last quarter, slightly declining recently to about 147 yen, offering an advantage to Japanese exporters like Honda.
Fujimura acknowledged that the transition to electric vehicles (EVs) in China is accelerating faster than anticipated, prompting Honda to adjust its production strategies. Japanese automakers, historically dominant in gas-powered vehicles, now face the challenge of establishing a foothold in the competitive EV market.
In the U.S., concerns persist regarding market condition uncertainties tied to the upcoming presidential election in November, though Fujimura refrained from commenting on the political landscape. He noted that American consumers are disillusioned with the rapidly depreciating value of newly purchased electric cars, including those from Honda.
Despite these challenges, Honda remains steadfast in its fiscal year forecast, aiming for 1 trillion yen ($6.8 billion) in profit, slightly down from the previous year’s 1.1 trillion yen, on projected sales of 20.3 trillion yen ($138 billion), down from 20.4 trillion yen.
Honda’s motorcycle sales have seen a downturn in Thailand due to a weakened economy but are thriving globally, particularly in India, Brazil, and North America. The company anticipates selling about 2.97 million vehicles and 13 million motorcycles worldwide in the fiscal year ending March 2025, maintaining similar figures to the previous year.
In contrast, Nissan Motor Co. recently revised its annual profit forecast downward as profits declined despite stable sales. Meanwhile, Toyota Motor Corp. reported record profits for the latest quarter, supported by a favorable exchange rate, bolstering its financial results.
