Wed, 11 Aug 2021

Honda swings back to profitability in Q2 2021

Robert Besser
09 Aug 2021, 01:42 GMT+10

TOKYO, Japan: Honda recouped lost ground as it swung back to being profitable during the second quarter, reporting profits of $2 billion, with improved sales, as well as cost-cutting efforts contributing to the company's final results.

Honda recorded losses of $736 million during the corresponding quarter in 2020, when the automobile sector bled from the impact of the COVID-19 crisis.

The company's quarter-wise sales reached $33 billion, an almost 69-percent increase year-on-year, on the back of the recovery in North American auto sales.

Meanwhile, the company's sales of motorcycles soared in Indonesia and India.

An improvement was recorded in Honda's financial services due to steeper costs of second-hand cars, whereas Honda's aircraft operations were affected, as per information from the Tokyo-headquartered manufacturer of the Gold Wing, Odyssey, CR V SUV, and Advanced Step in Innovative Mobility.

Additionally, Honda has raised its profit projections for 2021 until March next year to $6.1 billion, a revision to its earlier estimate by $734 million, driven by improvements in sales and cost-slashing measures.

However, Honda slightly lowered its vehicle sales projections for the calendar year to 4.85 million cars, as compared to the earlier five million, yet better in comparison with the 4.5 million sales reported this year through March.

The company reported vehicular sales reaching 998,000 units during Q2, an increase as compared to 792,000 vehicles during the corresponding period in 2020.

The company's outcomes highlight the fact that Japan's auto manufacturers are gradually making a recovery, after having reeled from the impact of the COVID-19 crisis, as well as a worldwide shortage of semiconductors.

On August 4, automotive manufacturer Toyota announced profits of $8.2 billion in Q1, rising over five times that recorded in 2020.

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