Honda logs 14% drop in quarterly operating profit in North America

Article by Christian A., on October 30, 2014

Honda Motor Co. saw its operating profit in North America drop 14 percent to JPY38.92 billion ($355.7 million) in the fiscal second quarter ended September 2014, no thanks to declining sales and heavy discounting. With the drop, North America was Honda’s only major market that failed to post a gain in operating results.

In fact, Honda posted gains in both Japan and Asia, and even managed to cut its losses in Europe. According to Executive Vice President Tetsuo Iwamura, the operating profit drop in North America could be attributed to heavy incentives to sell more cars in the United States, especially to sell down the 2014 Accord.

While Honda posted a 33-percent surge in US sales for the Accord to 84,031 units, it was not enough to offset a 3-percent dive in sales in North America to 434,000 vehicles. The earnings drop in North America also affected Honda’s global operating profit, sending it down 4 percent to JPY164.44 billion ($1.5 billion) in the fiscal second quarter.

The carmaker logged a 2-percent surge in global sales in the quarter to 1.07 million vehicles, but posted a drop in Japan. It recorded a 4-percent jump in global revenues to JPY3.02 trillion ($27.55 billion) and an 18-percent rise in total net income to JPY141.9 billion ($1.3 billion).

With the results, Honda updated its full fiscal year global sales and net income forecasts to reflect a drop, blaming weakening sales outlooks in Japan and China.

For the fiscal year ending March 31, 2015, Honda is expecting to sell 4.6 million vehicles globally (up from 4.3 million posted in previous fiscal year) and log a 1.6-percent drop in net income JPY574.1 billion.

If you liked the article, share on:

Comments

Recommended

The first time Porsche revealed the Panamera Sport Turismo to the public was during the 2017 Geneva Motor Show earlier this year. And now it has already entered production, and...
by - July 27, 2017
Autocar has got some juicy rumours for us regarding a new McLaren hypercar. The British publication has inside sources claiming that a new model will be added to the Ultimate...
by - July 27, 2017
Ferrari has recently launched the New Power15 extended warranty program. The company developed this program in response to the notion that supercars are very expensive to maintain. Truth be told,...
by - July 27, 2017
The UK it seems is about to take the same road as its neighbouring country France by banning sales of petrol and diesel vehicles beginning 2040. As reported by The...
by - July 27, 2017
What has BMW been up to lately? The company recently announced that they are currently focusing on electrification, and so far, their new architecture will enable “electrification of every model...
by - July 26, 2017
Facebook

Youtube Channel

Tip Us
Do you have a tip for us?
Did you film an important event?
Contact us
Newsletter
Subscribe to our newsletter!
Subscribe
Galleries