Honda to recall another 21m cars with Takata airbags

Honda has confirmed earlier reports it would recall about another 20m vehicles to replace Takata airbags.

Its annual profit fell on the costs of recalling four times the number of vehicles it made last year to replace the air bags. Now a stronger yen will weigh on prospects for a rebound.

Net income fell to JPY344.5bn (US$3.2bn) for the full fiscal year to 31 March, 2016, the automaker said in a statement cited by Bloomberg, missing its forecast by 34%.

Honda would recall 21m more vehicles to replace Takata air bags, executive vice president Tetsuo Iwamura told Bloomberg.

Honda took another JPY267bn charge related to Takata air bag recalls, the report added.

Honda’s profit forecast for this fiscal year doesn’t factor in estimates for air-bag recall costs.

The company has booked provisions for all Takata air bag inflators that lack a moisture-absorbing desiccant, Iwamura told Bloomberg. Those cost the company JPY436bn in the latest fiscal period and JPY120bn a year earlier.

Sign up for our daily news round-up!

Give your business an edge with our leading industry insights.

Sign up