Grey Skies Gonna Clear Up: Honda Reports Bigger Loss, Sees Light at the End of the Year
Honda reported a $765 million loss in the fiscal quarter ending June 30th, a marked downturn in its financial standing when compared to the quarter before.
Hardly shocking, though, given the virus-related global sales plunge and the production shutdown that afflicted the American manufacturing scene in April and May. Honda’s characterizing it as a “nowhere to go but up” scenario.
The grim last quarter followed a Q1 (technically, Q4 of the previous fiscal year) that saw the automaker lose just over a quarter million dollars. Last quarter’s operating loss is pegged at $1 billion, compared to the $2.35 billion profit recorded in the far sunnier first fiscal quarter of 2019.
Revenue was down 47 percent, while worldwide vehicle sales plunged 40 percent. In the U.S., the automaker’s new vehicle sales fell 11.2 percent, with Honda-badged cars down 19.5 percent. Interestingly, the only Honda car to see a gain in volume was the discontinued Fit. Also of note, the Acura brand eked out a sales gain for the quarter, up 2.5 percent.
In its earnings report, Honda said it expects “to recover from the unfavorable impact of the COVID-19 toward the end of the fiscal year,” adding that it predicts operating profit for the current fiscal year to come in at $1.86 billion, with a global sales loss of 6 percent.
“Honda will strive to further enhance its earnings structure by making steady progress in on-going initiatives to improve its business structure,” the automaker stated.
[Image: © 2019 Chris Tonn/TTAC]
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"Interestingly, the only Honda car to see a gain in volume was the discontinued Fit" sure. Chevy SS also broke all records in the last year
Honda said it expects “to recover from the unfavorable impact of the COVID-19 toward the end of the fiscal year” Sure, OK. Translation: "Sales will continue to tank, so we're going to cut people and product to make ends meet."
The Truth About the Future: Per Honda: 'Nothing bad is going to happen for the rest of the year.' In Reality: Nothing anywhere is going to improve until Chevrolet moves the Corvette engine back where it belongs.
I swear the Passport is the Pajama Boy of SUVs.