Japanese carmaker Honda reports profit rise despite pandemic

Japanese carmaker Honda has reported that profit rose 23% in the last quarter, despite a pandemic that has hit businesses around the world.

Tokyo-based Honda said its July-September profit was 240.9 billion yen (£1.77 billion), as the auto market recovered in some parts of the world.

Honda said it carried out aggressive cost cuts that involved a “fundamental review” of its operations. The situation was also improving from earlier this year, when lockdowns and other problems related to Covid-19 caused disruptions of some production and an inventory crunch.

Quarterly sales slipped to 3.65 trillion yen (£26 billion).

Honda, which makes the Accord sedan, warned that uncertainty remains amid rising Covid-19 cases. But the company stressed it was managing to cling to profitability.

Reflecting that upbeat mood, Honda raised its profit forecast for the fiscal year through to March 2021.

Honda sold slightly more vehicles in the quarter through to September at 1.25 million, compared with 1.24 million vehicles in the same period of 2019.

But it sold fewer motorcycles at nearly 4.5 million, down from nearly 5.1 million.

Kohei Takeuchi, a senior Honda manager, said much of the damage to sales probably came from the pandemic, though he hesitated to blame the entire decline on the pandemic.

Executive vice president Seiji Kuraishi told reporters Honda is bullish on shifting its line-up to ecological models to keep up with the global efforts to curb carbon emissions and global warming.

Also on Friday, Toyota raised its full-year fiscal forecasts after reporting results that appear to show a gradual but sure recovery. Its profit fell 11% in the last quarter.