By Chang-Ran Kim
TOKYO, April 27 Honda Motor Co forecast
a near-tripling of operating profit in the year ahead on surging
Asian sales and a recovery in the United States, marking an
emphatic rebound from a 2011 hammered by the yen's record
strength and natural disasters.
Japan's No.3 automaker is expected to ride
faster-than-expected growth in demand in the United States, its
biggest and most profitable market, where sales of the
remodelled CR-V crossover have jumped by more than a quarter so
far this year.
For the year to next March, Honda forecast an operating
profit of 620 billion yen ($7.7 billion), up from 231.36 yen in
the financial year just ended. The forecast was slightly behind
analysts' consensus for 645 billion yen, but bullish nonetheless
for a company noted for its conservative earnings guidance.
"The North American market is slowly recovering, while we're
entering new segments in Asia," said Executive Vice President
Tetsuo Iwamura. "We're expecting to grow faster than the overall
Iwamura added that the overall U.S. market would likely grow
to 14.3 million vehicles this year, up from 13.5 million seen at
the end of 2011, and Honda aimed to recover a market share of
more than 10 percent as soon possible.
Honda, which has lagged a recovery from the effects of
disasters in Japan and Thailand by rivals Toyota Motor Corp
and Nissan Motor Co, more than doubled its
fiscal fourth-quarter operating profit, ending five straight
quarters of decline.
January-March operating profit jumped to 111.98 billion yen
($1.4 billion), but slightly lagged an average estimate of 123.2
billion yen in a survey of 23 analysts by Thomson Reuters
I/B/E/S. Net profit, which includes earnings made in China, rose
60.7 percent to 71.59 billion yen.
Honda was the last Japanese car maker to get its supply
chain in order after a massive earthquake and tsunami in March
2011, and only re-started work at its Thai car plant at the end
of last month following October's floods.
ROBUST SALES FORECASTS
Giving robust sales guidance, Honda forecast its global car
sales would jump 38.4 percent to 4.3 million vehicles and its
motorcycle sales would increase 10.2 percent to 16.6 million in
It sees sales in North America rising 31.5 percent to 1.74
million vehicles, sales in Japan climbing 20.7 percent to
710,000 and the rest of Asia by 56.5 percent to 1.31 million.
Honda will make minor changes later this year to the
year-old Civic after the latest version of the perennially
popular model was panned by critics, raising deeper concerns
over whether the automaker was slipping in a battlefield made
tougher by products from Hyundai Motor Co and
resurgent U.S. rivals Ford Motor Co and General Motors Co
Honda CEO Takanobu Ito has conceded that the company he took
over in mid-2009 may have let down its guard during the previous
decade of rapid expansion, while pulling back on vehicle
development too much after the global financial crisis.
Honda is under intense scrutiny to redeem itself this fall
with the next version of the Accord, which will be the first
major model to carry a new generation of engines and
transmissions that it hopes will make its future cars the most
fuel-efficient in their categories.
Ito has put in place structural changes to respond more
nimbly to competition. He is doubling as head of car operations
for now. He also said this week that Honda would step up its
game in China, where its market share has slipped in the past
four years, announcing plans to boost output capacity and beef
up its local R&D function.
Honda's shares have risen 5.5 percent in the past three
months, lagging gains of around 14 percent by both Toyota and