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 new 2018 Ford Mustang GT, when equipped with its optional Performance package, will be able to produce 460 horsepower. It also comes fitted with Michelin Pilot Sport 4S tires...
by - October 19, 2017
It’s not as if the Porsche 718 Boxster and Cayman are not already impressive cars. The automaker has just given us more reasons to love the twins. The 2018 model...
by - October 19, 2017
After months of dropping online teasers, Polestar finally reveals its very first production car virtually. The Polestar 1 is a two-door coupe that gets its design inspiration from the 2013...
by - October 19, 2017
While the official premiere of 2018 Jeep Wrangler (JL/JLU) is already set this December, fans everywhere rejoiced at having had something like this appear on the web. Yes, everything we...
by - October 19, 2017
South Korean carmaker Kia will try to follow up the success of its Sportage compact sports utility vehicle by introducing a smaller SUV (subcompact) in the United Kingdom in the...
by - October 18, 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