Manufacturer blames pandemic, microprocessor shortage and recession for slowdown.
Honda’s fiscal first quarter profits tumbled by 33 per cent compared with the same period last year as the global computer chip shortage, a pandemic-related lockdown in China and the rising costs of raw materials hurt the Japanese marque.
Its profit totalled ¥149.2 billion, or about NZ$1.71b, from April to June, down from ¥222.5b in 2021. The value of quarterly sales slipped seven per cent to ¥3.8 trillion.
Honda kept its profit forecast for the full fiscal year through March 2023 unchanged at ¥710b.
The semi-conductor shortage has hurt all the world’s carmakers despite strong demand and brands have been scrambling to secure alternative suppliers.
Honda, which makes the Accord, Odyssey, and Civic, sold about 815,000 units last quarter, down from 998,000 in the same period a year earlier. Registrations dropped in almost all regions around the world, including Japan, the US and Europe.
“I ask for the understanding from all those who are still waiting for their vehicles and vow that our whole company is doing its utmost to make the deliveries even a day sooner,” says chief financial officer, Kohei Takeuchi.
Takeuchi adds the semi-conductor shortage curtailed motorcycle production as well as car output, adding to uncertainty about future prospects.
Honda says Shanghai’s recent lockdown was among the causes of the shortage in computer chips supply, without giving specifics.
Although US sales are potentially facing a dent from recession worries and other economic hardships, Takeuchi is more worried about the shortage problem and producing the cars customers are waiting for.
Takeuchi notes motorcycle sales for the quarter, which grew to 4.25m from 3.88m a year earlier, are going strong, especially in India. The cheaper yen and cost cuts have helped to maintain profitability overall, he adds.