Honda Motor Co. has reported a robust fiscal first-quarter performance, with profits more than doubling compared to the same period last year. The Tokyo-based automaker recorded a profit of 456.9 billion yen ($2.9 billion) for the April-June period, a significant increase from the 196.6 billion yen reported a year earlier. Quarterly sales also saw a healthy rise of 13.5%, reaching 6.06 trillion yen ($38 billion), driven by strong vehicle demand in the United States and India for models such as the Accord sedan, Fit subcompact, and the Super Cub motorcycle.
This financial rebound comes as the company works to recover from its first-ever full-year loss, which totaled 423.9 billion yen ($2.7 billion) for the fiscal year that ended in March. That previous deficit was largely attributed to high costs associated with electric-vehicle (EV) initiatives that failed to meet expectations. Analysts noted that consumer interest in EVs was lower than anticipated, leading Honda to abandon several planned electric models. The company also faced headwinds from U.S. policies during the Trump administration, which reduced EV incentives, withheld funding for charging infrastructure, and imposed tariffs on imported autos and parts—initially set at 25% and later lowered to 15%.
Company officials emphasized the need to optimize resources in the U.S. market, noting that a full turnaround may require another year or two. Kawaguchi said Honda’s overall first quarter results were very healthy, thanks partly to a favorable exchange rate. Although the recent U.S.-Japan joint intervention has boosted the yen’s value somewhat, the U.S. dollar traded higher during the fiscal first quarter, compared with the previous year. Because a weaker yen increases the value of overseas earnings when converted, this trend served as a significant benefit for Honda as an exporter.
Looking ahead, Honda has raised its profit forecast for the current fiscal year to 400 billion yen ($2.5 billion), up from an earlier projection of 260 billion yen ($1.6 billion). However, the company faces recent operational challenges following a 7.1 magnitude earthquake in Kumamoto, southwestern Japan. The seismic event caused temporary production line halts and supply chain disruptions. While Honda prepares for a scheduled summer break later this month, the exact long-term impact of the earthquake on production remains unclear. Following the announcement of these results, Honda shares rose 3.9% in Tokyo trading. Yuri Kageyama is on Threads: https://www.threads.com/@yurikageyama
A cheap yen is a boon for Japanese exporters like Honda because it raises the value of its overseas earnings when translated into yen.
Like other Japanese companies, Honda is going on a summer break later this month. Officials said they’re hoping things will have returned to normal by the time they’re back at work, and the exact impact of the quake on vehicle production is still unclear.
