Lower sales in the key US market resulted in a 16% drop to operating profit for Honda in the first quarter of the fiscal year.
Operating profit decreased by 15.7%, to JPY 252.4 billion from the same period last year, due mainly to increased selling, general and administrative expenses, a decrease in profit attributable to decreased sales revenue and model mix as well as negative foreign currency effects, Honda said. which was partially offset by continuing cost reduction.
Profit before income taxes decreased by 19.1%, to JPY 289.8 billion from the same period last year.
The company's US sales fell to 407,000 vehicles over the three-month period, from 425,000 vehicles a year earlier (Honda said due mainly to lower Accord sales).
Honda lowered its forecast for global sales in the year to March 2020 to 5.11 million vehicles, from its prior projection of 5.16 million and a record 5.323 million sold last year.
Honda, however, stuck to its forecast for a 6% increase in operating profit to 770 billion yen for this fiscal year, despite a projection of -1.5% lower sales revenue to 15,650 billion yen.