Honda Motor president Takeo Fukui said on Friday he expects only a minor impact on the car maker’s profit this fiscal year from the yen’s recent rise, Dow Jones reported.
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The news agency noted that the yen has gained around 7% against the dollar in the past month, which threatens to erode the profits of firms that export goods to the US, such as Honda.
Honda’s latest forecast is for group net profit of Y451 billion in the fiscal year to the end of March and will release its first-half earnings on October 28, Dow Jones said.
Fukui told the news agency that Honda will probably need to forecast a stronger yen than it originally estimated for the second half of the fiscal year.
The company currently expects the dollar to average Y115 in the second half and Y117 in the full year to the end of March, having forecast a rate of Y119 for the first half, Dow Jones added.
Fukui reportedly said: “I don’t think there will be a major impact” on Honda’s earnings this fiscal year as the company has already become less sensitive to exchange-rate fluctuations after boosting production at local bases outside Japan.
The Honda president told Dow Jones other currencies, such as the euro, will help to keep the earnings impact minor, as moves in those currencies may help soften the impact of the weaker dollar.
Dow Jones noted that Nissan Motor on Thursday maintained its earnings forecast for the full year despite lowering its assumed dollar rate for the second half to Y110 from Y120, as it expects strong US sales to continue to support its bottom line.
