Honda Motors' Exceeding Estimates: Full-Year Profit Up 2.8%

10 May, 2024

Honda Motors' Exceeding Estimates Full-Year Profit Up 2.8%

Japan's Honda Motor Co projects a 2.8% increase in operating profit for the fiscal year, buoyed by robust sales in the US, which overshadowed a downturn in China. The company anticipates a full-year operating profit surge to 1.42 trillion yen ($9.13 billion), surpassing analysts' average projection of 1.39 trillion yen.

During the quarter ending March 31, operating profit soared over sixfold to 305.6 billion yen, surpassing analysts' expectations by a significant margin. Notably, sales in the US, Honda's largest overseas market, surged by 17% to approximately 378,000 vehicles, contrasting with a more than 6% decline in China to around 207,000 vehicles during January-March.

In China, where competition is fierce, Japanese automakers like Honda face challenges from local rivals offering low-cost electric vehicles with advanced technology. Despite being a latecomer to the electric vehicle market, Honda unveiled plans to establish an EV production hub in Ontario, Canada, and introduce six EV models under the "Ye" brand in China by 2027. This strategic move reflects Honda's commitment to adapt to evolving market demands and expand its presence in the rapidly growing electric vehicle sector.