TOKYO – On Wednesday, Japan’s Honda Motor (NYSE: HMC) reported a 23% increase in first-quarter profit as the automaker benefited from a weaker yen, higher pricing, and growing hybrid vehicle sales in the U.S. and its home market.
Japan’s second-biggest carmaker said quarterly operating profit totaled 484.7 billion yen ($3.3 billion) in the April-June period, compared with an average estimate of 472.4 billion yen in a poll of seven analysts by LSEG.
The company maintained its full-year operating profit forecast of 1.42 trillion yen while slashing its sales outlook for China by 21% to 840,000 vehicles for that period.
Last week, Honda said its global vehicle sales grew 2% to 1.9 million over the first six months of the year, largely due to a 9% rise in sales in the top market, the U.S.
In contrast, it faced heavy headwinds in China where it saw sales slump 23% to 416,000 vehicles.
In China, Honda Motor (NYSE: HMC) has been suffering from heavy price competition and a faster-than-expected decline in the market for internal combustion engine vehicles, CFO Eiji Fujimura told an earnings briefing.
Earlier in July, Honda Motor (NYSE: HMC) said it would close a factory in China and halt vehicle production at another plant amid intense competition from newer Chinese auto brands.
It plans to start production at two new electric vehicle plants in China run through two joint ventures with Chinese automakers later this year.
Honda is seeking to catch up with faster-moving global rivals in the shift to battery-powered electric vehicles, for which it is looking to profit from cooperation with rival Japanese automaker Nissan Motor.
On Thursday, the companies said they had agreed to research technologies for a next-generation software platform together and sought to cooperate in areas such as batteries, e-axles, and vehicle complementation.
($1 = 147.0100 yen)
(Source: Reuters)
Jennifer Tacker is a staff writer at ABBO News. She holds a B.A. from the University of Waterloo and a B.Ed from Western University. Jennifer has been active in the stock market and crypto sector for a decade. She specializes in technical analysis and trading strategies.
