Almost six months after floods in Thailand had halted Honda’s auto production at factory in Ayutthaya, it has been able to resume operations. Honda had said last January that its Thailand production will be fully operational in April. Honda had said that the impact of the floods has led to the lost production of 260,000 vehicles worldwide for the business year that ends this month.
Honda was the worst affected as it had owned the only car plant flooded in. The production of competitors like Toyota and Nissan has normalized by the end of 2011 as they discovered alternative sources for parts outside of the interrupted supply chain.
In 2011, Honda's worldwide output declined by around 20% to 2.91 million cars, falling below 3 million for the first time in eight years. All the other Japanese automakers, with the exception of Nissan, produced fewer cars. However, the declines were much milder than what Honda experienced.
Last January, Honda said that for the business year that ends March 31, it predicts an operating profit of 200 billion yen ($2.6 billion). This profit prediction is short of the 270 billion yen forecasted in August. Honda was forced to revise this guidance due to the uncertainty of when auto production may restart in Thailand. Like other car companies, Honda struggled under the strengthening yen that made exports less profitable.