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Honda's European, North American Profit Goes Down

The global recession affected profits of most carmakers, especially the ones exporting vehicles to the United States market and unfortunately, Honda is not an exception to the rule. According to figures provided straight by the Japanese manufacturer, Honda's profit declined no less than 80.6 percent in North America and approximately 50 percent in Europe! In addition, sales in US were reduced by 9.9 percent, totaling 401,000 units according to Autonews.

“Citing unraveling demand in the United States, Tokyo-based Honda lowered its global operating profit forecast to 550.0 billion yen ($5.09 billion) for the fiscal year to March 31, 2009, from an earlier target of 630.0 billion yen ($5.83 billion),” the aforementioned source wrote.

On the other hand, Honda's European profit reached $76 million in the second quarter, almost a half the profit recorded in same period of 2007. Sales were reduced to 87,000 units in Europe, with increased demand in Russia but lowered in UK and Italy, Autonews added.

Together with Suzuki and Yamaha, Honda was one of the first companies who reacted to the global economic crisis. The three motorcycle giants announced job cuts and lowered production in North America, a market where demand for motorcycles was greatly reduced.

Moreover, Honda today announced a series of production adjustments that underline once again that the Japanese company is willing to reduce the recession effects by adapting its products to the market demands. For instance, officials said that most American plants will concentrate more on small cars and less on SUVs and pickups while the engine-development centers will struggle to design new fuel-efficient versions.
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About the author: Bogdan Popa
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Bogdan keeps an eye on how technology is taking over the car world. His long-term goals are buying an 18-wheeler because he needs more space for his kid’s toys, and convincing Google and Apple that Android Auto and CarPlay deserve at least as much attention as their phones.
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