Honda Profits Increased Seven-fold

Net profit of $1.5 billion

Helped by increased sales in India and China, Honda Motor said on Feb. 3 its profits soared almost seven-fold in the latest quarter from a year earlier.

The maker of the Insight hybrid and the Civic and Accord cars sharply hiked its earnings forecasts, offering another ray of hope for the battered sector.

Honda posted a better-than-expected net profit of 134.6 billion yen (US$1.5 billion) for the fiscal third quarter through December, up from 20.2 billion yen in the same period of the previous year.

Also with robust sales in the rest of Asia, cost-cutting helped to boost the group's bottom line, offsetting an 11.5% drop in revenue in the quarter to 2.24 trillion yen.

For the full financial year which ends next month, Honda raised its net profit projection to 265 billion yen from 155 billion, and its revenue target to 8.53 trillion yen from 8.45 trillion.

Honda was the only one of Japan's top three automakers to post a profit for the financial year to March 2009, outperforming Toyota and Nissan which suffered heavy losses.

Like other Japanese carmakers, Honda is pinning hopes on sales of fuel-efficient cars to help it recover from the fallout of the global downturn.

It suffered a setback last week when it recalled 646,000 vehicles worldwide due to a fire risk, in a fresh blow to Japanese makers' reputation for quality after a series of massive recalls by world number one Toyota.

Copyright Agence France-Presse, 2010

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