78.69 F
New York
August 18, 2019
Home » Blog » Honda first-quarter operating profit drops 16% on lower U.S. car sales
Reuters - Business

Honda first-quarter operating profit drops 16% on lower U.S. car sales

Honda first-quarter operating profit drops 16% on lower U.S. car sales

A man is reflected on a window at Honda Motor’s showroom in Tokyo, Japan, May 13, 2016. REUTERS/Toru Hanai/File Photo

TOKYO (Reuters) – Japan’s Honda Motor Co (7267.T) reported a 16% drop in first-quarter operating profit on Friday, as a stronger yen weighed on overseas earnings and U.S. vehicle sales dropped.

Japan’s No.3 automaker posted operating income of 252.4 billion yen ($2.36 billion) for the April-June period, compared with 299.3 billion yen a year ago and an average forecast of 246.9 billion yen from seven analysts polled by Refinitiv.

The company’s U.S. sales fell to 407,000 vehicles over the three-month period, from 425,000 vehicles a year earlier.

It lowered its forecast for global sales in the year to March 2020 to 5.11 million vehicles, from its prior projection of 5.16 million and a record 5.323 million sold last year.

Honda, however, reiterated its forecast for a 6% increase in operating profit to 770 billion yen for this fiscal year.

Honda, like other car makers, has been scrambling to reinvent itself amid rising competition from technology firms – such as Google parent Alphabet (GOOGL.O) and Uber (UBER.N) – as the auto industry moves toward vehicles that are shared, autonomous and electric.

In May, Honda signaled that it was looking to cut global production costs by 10% by 2025 and scale back regional model variations, channeling savings into research and development.

The company has also expanded partnerships, joining mobility project by SoftBank Group Corp (9984.T) and Toyota Motor Corp (7203.T), and investing in General Motors Co’s (GM.N) Cruise self-driving vehicle unit.

Reporting by Kevin Buckland; Editing by Himani Sarkar


Related Articles

Hopes of ECB, Fed rate cuts boost global stocks, British pound sags


Apple Card will not allow purchase of cryptocurrencies


JPMorgan beats profit estimates but shows signs of pressure


Leave a Comment

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Click whichever is suitable. Accept Read More