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Honda reported Wednesday that its profit rose 8.7% in the April-June quarter as strong sales of hybrid vehicles in Japan and the U.S., and motorcycles in India and Brazil, boosted the Japanese automaker’s earnings.
Honda Motor Co.’s profit in the last quarter totaled 394.7 billion yen ($2.7 billion), up from 363 billion yen a year earlier. Quarterly sales rose nearly 17% to 5.4 trillion yen ($36.7 billion).
A favorable currency exchange rate helped Honda, while tough price competition in China hurt, according to the maker of the Accord sedan, Fit subcompact, Super Cub motorcycle and Asimo robot.
The positive impact of a weak yen added nearly 48 billion yen ($326 million) to Honda's quarterly operating profit, the company said.
A weak yen works as a plus for Japanese exporters like Honda. The U.S. dollar was trading above 150 yen in the last quarter, although it recently declined to about 147 yen.
Eiji Fujimura, Honda's chief financial officer, said the currency effect remained uncertain, but stressed that Honda was focused on delivering the right products to various markets, helping making it relatively resilient to currency effects.
He acknowledged the shift to electric vehicles in China was moving quicker than expected, and Honda was busy adjusting its production. All the Japanese automakers, which dominated in gas engine vehicles, face a challenge in competing in the EV sector.
Concerns also remain in the U.S. market, Fujimura said, noting uncertainties over the presidential election in November, though he would not comment directly on the political situation. American consumers have been disappointed about the rapidly falling value of electric cars they had just bought, including Honda EVs, he said.
Tokyo-based Honda stuck to its fiscal year forecast for 1 trillion yen ($6.8 billion) in profit, down slightly from 1.1 trillion yen racked up the previous year, on 20.3 trillion yen ($138 billion) sales, down from 20.4 trillion yen.
Honda’s motorcycle sales have fallen in Thailand due to its weak economy but are booming overall, including in India and Brazil, as well as North America. It expects to sell about 2.97 million vehicles around the world in the fiscal year ending in March 2025, and 13 million motorcycles, both about the same as a year ago.
Last month, Nissan Motor Co. lowered its annual profit projection, as profits declined despite steady sales. Toyota Motor Corp. reported record profits for the latest quarter, as a favorable exchange rate boosted its bottom line.
