Honda posts 13% drop as profit slides amid coronavirus pandemic

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Honda Motor Co (7267.T) on Tuesday posted its lowest operating profit in four years and refrained from releasing an earnings outlook for the current business year as the coronavirus pandemic hits global car demand.

“It is difficult to predict when COVID-19 will subside and how situations in each country and region will develop,” Honda said in its earnings release.

Honda’s operating profit for the year ended in March fell 13% to 634 billion yen ($5.9 billion), falling short of a consensus estimate of 669 billion yen profit drawn from 19 analysts polled by Refinitiv.

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Honda and other global automakers have begun to gradually resume operations at their vehicle plants, but face weak demand as job losses and concern about a global economic downturn weigh on consumer spending.

Carmakers are also trying to cope with supply chain disruptions and social distancing measures that are expected to limit output in the coming months.

Some analysts believe global vehicle sales this year could tumble by a third, a much steeper decline than the 11% fall seen in 2009/10 business year amid the global financial crisis.

For the year ended March, combined annual sales at Japanese automakers fell 7.3% to a four-year low of 26.5 million vehicles, calculations by Reuters show. Honda saw an 8.5% decline.

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(Source:- Reuters/Reporting by Naomi Tajitsu and Tim Kelly; Editing by Edwina Gibbs)

Featured Image:-FILE PHOTO: The logo of Honda is seen during the 88th International Motor Show at Palexpo in Geneva, Switzerland, March 6, 2018. REUTERS/Pie

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