By Yoko Kubota
TOKYO-- Honda Motor Co. cut its full-year net profit forecast by
3.5% after being hit by costs related to recalls over explosive air
bags made by Takata Corp.
The Japanese auto maker Friday said it now expects to post a
Yen545 billion net profit in the fiscal year ending in March, which
would be down 5.1% from last fiscal year.
Honda's October to December net profit fell 15.1% from a year
ago to Yen136.5 billion, slightly below a mean estimate of Yen137.3
billion by 26 analysts, according to financial data provider
FactSet.
Its third quarter revenue rose 8.9% to Yen3.3 trillion.
The weakening yen is set to benefit all Japanese auto makers
because it makes exports cheaper and helps them convert money made
overseas at a more favorable rate. But for Honda, the first of the
three top Japanese auto makers to report third-quarter financial
results, that boost was offset by mounting costs related to recalls
and safety.
Earlier this month, the U.S. auto safety regulator slapped Honda
with $70 million in fines for failing to report potential safety
problems in vehicles for more than a decade.
Honda is also taking the biggest hit among auto makers that have
recalled vehicles over Takata-made air bags that could explode and
shoot out shrapnel at vehicle occupants. Honda accounts for more
than half of the around 25 million vehicles that have been recalled
over six years.
On Thursday, Honda said it learned of a death in Houston, Texas
that may have involved a Takata air bag explosion on a 2002 Honda
Accord. The vehicle was recalled in 2011 but wasn't repaired, Honda
said. The auto maker is investigating the matter.
Write to Yoko Kubota at yoko.kubota@wsj.com
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