Honda profit jumps on cost cuts, absence of recall expenses
https://gistzzone.blogspot.com/2017/02/honda-profit-jumps-on-cost-cuts-absence.html
TOKYO (AP) — Tokyo-based Honda Motor
Co. reported Friday a 36 percent jump in profit for October-December on
year, shrugging off damage from a strong yen, and the Japanese automaker
raised its full year forecast.
Cost
cuts lifted fiscal third quarter profit to 168.8 billion yen ($1.5
billion), up from 124.1 billion yen the previous year. Also helping was
the absence of earlier huge expenses for recalls over supplier Takata
Corp. air bags, which had eaten into profits up through the fiscal
second quarter.
Quarterly sales
edged down 3 percent to 3.5 trillion yen ($31 billion) from 3.6
trillion yen. Honda said vehicle sales were strong in China and in the
U.S., however, thanks to the release of new models.
Honda,
which makes the Odyssey minivan, Asimo child-like robot and Super Cub
motorcycle, raised its full fiscal year profit forecast to 545 billion
yen ($4.8 billion).
That was up
58 percent from 344.5 billion yen a year ago, when Honda was hit by
expenses for the Takata recalls. Honda had earlier expected a 415
billion yen ($3.6 billion) annual profit. It said a more favorable
exchange rate would likely help.
Defective
inflators have set off excessive explosions in Takata air bags, spewing
shrapnel into the passenger compartment, killing at least 16 people
worldwide.
That has resulted in
the largest auto recall in U.S. history, affecting 69 million inflators
and 42 million vehicles. About 100 million inflators have been recalled
worldwide.
Almost all the world's
major automakers have models affected by the Takata recall, but Honda is
among the most exposed because it has had a close relationship with
Takata. Honda expressed hopes that the worst of such expenses was behind
it.
Last month, Takata agreed to plead
guilty in the U.S. and pay $1 billion in fines and restitution over a
lengthy scheme to conceal the deadly defect in millions of air bags.
Three former Takata executives were also indicted in the case.