Tsunami Trauma: Honda Forecasts Heavy Hit On Results

Bertel Schmitt
by Bertel Schmitt

Honda joins other Japanese automakers in a delayed post-tsunami forecast. Percentage-wise, Honda expects to be much harder hit than Toyota. Honda expects a net profit of 195 billion yen ($ 2.43 billion) when the current fiscal year ends in March 2012.through March. Last year, there were 534 billion yen ($6.65 billion) left below the bottom line. That’s a decrease of 63.5 percent.

Analysts are shocked. A post-quake survey of 20 analysts by Thomson Reuters I/B/E/S yielded expectations of 407.2 billion yen ($ 5.07 billion.) As in the case of Toyota, analysts vastly underestimated the impact of the tsunami, the high yen, and the rise in raw material prices.

The outlook is much weaker than the Y385.43 billion mean estimate in a survey of 20 analysts compiled by Thomson Reuters.

Honda expects its worldwide sales of cars to drop by 212,000 units from 3.512 million in fiscal 2011 to 3.300 million units in fiscal 2012.

“The limited supplies of parts is affecting the production of the new Civic.We are still not able to procure enough electronic devices for some high-end models,” Honda CFO Fumihiko Ike, told The Nikkei [sub] at a press conference today.

Honda thinks its production in Japan will return to normal by the end of June. Overseas production will take several more months before it runs at full capacity.

Note: The financials are for all Honda products, including motorcycles and generators

Bertel Schmitt
Bertel Schmitt

Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.

More by Bertel Schmitt

Comments
Join the conversation
 4 comments
  • Tekdemon Tekdemon on Jun 14, 2011

    Is that by the Ontario plant?

  • Psarhjinian Psarhjinian on Jun 14, 2011

    I don't think so. That doesn't look like an Ontario roadsign, nor a North American tractor, and the Alliston plant doesn't make CR-Vs. That's probably in Europe.

    • Polpo Polpo on Jun 14, 2011

      It's the plant in Swindon, England. CR-Vs bound for Europe are made there, and in the CR-V's previous generation, ones for the US were made there, too. Here's the location on Google Street View: http://goo.gl/maps/AaGl

  • Fincar1 Fincar1 on Jun 14, 2011

    Yep, I'd say UK.

Next