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Tokyo-based Honda Motor Co., which dropped talks to integrate
its business with Japanese rival Nissan Motor Corp. earlier this
year, said its annual profit totaled 835.8 billion yen ($5.6
billion), down from 1.1 trillion yen in the previous fiscal
year.
Annual sales edged up 6.2% to nearly 21.69 trillion yen ($147
billion).
Research and development costs hurt, despite Honda’s record
global motorcycle sales for the fiscal year, which topped 21
million motorcycles.
Hybrid vehicle sales also did well, especially in the U.S., and
Honda's profitability per vehicle was also improving, according
to the maker of the Accord sedan and CR-V sports-utility
vehicle.
Executive Vice President Noriya Kaihara acknowledged that
Trump’s tariffs were likely to hurt, erasing 650 billion yen
($4.4 billion) from its operating profit for the fiscal year
through March 2026. That's mainly because of U.S. tariffs on
vehicles from Canada and Mexico. Honda’s vehicle shipments from
Japan to the U.S. are negligible.
Officials stressed major uncertainties remain, but said they
felt it was important to give a realistic projection, no matter
how pessimistic it might be.
Chief Executive Toshihiro Mibe said Honda will do its best to
minimize the impact from tariffs. In the long term, Honda will
transfer auto production to U.S. plants and rethink its
investment plans. All decisions will be made “very carefully,”
Mibe told reporters.
He also said Honda was sticking to its plans to produce more
electric vehicles.
Various automakers have said they are baffled by Trump's
opposition to EVs and his tariffs, and some companies are
trimming back their ambitious electrification plans.
Honda is projecting a 70% nose-dive in profit for the fiscal
year through March 2026, at 250 billion yen ($1.7 billion), on
20.3 trillion yen ($137 billion) in sales, down 6%.
Honda and Nissan announced in December they were going to hold
talks to set up a joint holding company. Mitsubishi Motors
Corp., another Japanese automaker, had said it was considering
joining that group. But the plans quickly unraveled, with Nissan
saying it wanted out because it would be at a disadvantage.
Nissan, which has slipped into red ink lately, reports financial
results later Tuesday.
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