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Honda’s sales, profit drop amid rising costs, chip shortages

TOKYO (AP) – Honda’s profit dropped 32 per cent in the last quarter as rising material costs and a shortage of computer chips hurt the Japanese automaker.

Honda Motor Co’s profit for the three months through December totalled JPY192.9 billion (USD1.7 billion), down from JPY284 billion the year before, the Tokyo-based company said yesterday.

Quarterly sales slipped two per cent to JPY3.7 trillion (USD32 billion).

Like the rest of the world’s automakers, Honda’s manufacturing also has been affected by delays due to measures to curb coronavirus outbreaks.

Honda, which makes the Accord sedan, Gold Wing motorcycles and Asimo robot, said it expects the challenges to persist.

Rising material costs are also a problem, but the company said cost-cutting efforts allowed it to raise its profit projection.

It raised its full fiscal year profit forecast to JPY670 billion (USD5.8 billion) from an earlier projection of JPY555 billion (USD4.8 billion), an improvement from the JPY657 billion profit earned in the previous fiscal year.

Honda said cost-cutting efforts allowed the company to raise its profit projection. PHOTO: AP