Honda experience first annual loss in 70 years

HONDA Motors, with Irish offices in Citywest and a distributor site in Ballymount, has raised its forecasts and posted its first quarterly profit rise in six quarters after recording an annual loss in May.

Honda increased its full-year operating profit forecast by 30 per cent to 650 billion yen (€3.5 billion) from 500 billion yen, due to a weaker yen and revised assumptions.

Honda’s Irish offices are located at Orchard Avenue on Citywest Business Park and they also operate distributor services from M50 Business Park in Ballymount – the Ballymount facility is a 60,000 sqft featuring a state of the art service centre, three story warehouse facility, office space and showroom area.

Operating profit more than doubled to 530.8 billion yen

(€2.91bn) in quarter ranging from April to June, up from 244.2 billion yen a year earlier, while net profit and revenue outlooks were also increased.

The latest figures come after the Japanese automaker recorded its first annual loss in almost 70 years in May as it was hit by hefty costs to restructure its electric vehicle business.

The automaker incurred costs of around €8bn as it looked to make changes to that side of its business.

It said it expected to face extra restructuring costs of 520 billion yen (€2.85bn) this business year, but that no such costs occurred this quarter.

Honda said that negotiations with suppliers affected by the overhaul, many of them in North America, were still ongoing.

Worldwide Honda sales were brought down by an almost 50 per cent slump in China and other declines elsewhere in Asia as more consumers opted for electric vehicles due to high fuel prices.

These slumps offset gains made in the U.S. and Japan markets – the US had totalled around half of the full vehicle sales figure in the quarter.