Honda Motor Co. said Tuesday its consolidated operating profit fell 6.8 percent to 301.87 billion yen during the fiscal first half, marking the first year-on-year decrease in three years.
The carmaker blamed the disappointing results on the yen’s appreciation, increased operating costs tied to the expansion of its overseas businesses and falling domestic vehicle sales, including sales of the Fit compact and the Stream minivan.
But Honda posted a record consolidated pretax profit of 331.88 billion yen for the April-September period, up 21.3 percent from a year earlier. It attributed the rise to the rising value of the financial assets it holds, including derivatives, company officials said.
It also reported a record consolidated net profit of 239.18 billion yen, up 22.8 percent, due partly to increased profitability at affiliated companies in China and Southeast Asian countries, they said.
Group sales rose 4.5 percent to 4.03 trillion yen, thanks to thriving car sales in the United States and Asian countries.
In terms of volume, Honda’s global car sales rose 2.6 percent to 1.44 million units. Its shipments in North America rose 6.8 percent to 782,000 units, while those in Europe increased 8.7 percent to 113,000 units.
But domestic sales fell 22.8 percent to 329,000 vehicles, the first decrease in five years.
Its global motorcycle sales for the April-September period jumped 9.1 percent to 4.22 million units, thanks to strong demand in Thailand and India, company officials said.
“The decrease in our domestic car sales in the first half was larger than we had expected,” said Koichi Amemiya, Honda’s executive vice president, adding that the firm is trying to improve the situation via recently remodeled autos like the Life minicar and the Odyssey minivan.
Honda anticipates intense domestic competition in the second half, however, revising downward its full-year consolidated operating profit projection to 623 billion yen, down from the 644 billion yen forecast in July.
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