Honda’s Q4 Profit drops due to recall costs
Japan's third-largest automaker Honda, reported a drop in its net profit for the fiscal fourth quarter.
According to Honda, recall costs and a decline in auto sales in Japan dragged profits down. Quality problems delayed vehicle development and hampered sales.
The air bag recalls led to 43% drop in profit. The net profit shrank to 97.8 billion yen ($897 million), versus a year-ago profit of 170.5 billion yen.
The air bags were manufactured by Takata Corp. of Japan, which supplied air bags for a wide range of Honda models. In the defect, the air bag inflators can explode with too much force. The problem proved fatal to six people worldwide.
The automaker also suffered other quality lapses and recalled its hybrid models several times last year. The problems have tarnished Honda's reputation for quality, reduced sales and slowed down model development.
Executives have taken pay cuts and President Takanobu Ito has announced his resignation to take responsibility for the embarrassing problems.
However, the fall in Honda's profit as offset by weak yen as it added to the value of overseas sales of Japanese exporters.
The company delayed the launch of new cars after recalling the remodeled Fit hybrid car five times in less than a year in Japan.
For the fiscal year through March 2016, Honda anticipates that the profit would be little different from the year just ended March 2015. It projected a profit of 525 billion yen ($4.41 billion).
Honda is adopting international financial reporting standards (IFRS) from this year. Its quarterly sales rose 8% to 3.35 trillion yen ($28 million).
Meanwhile, Toyota Motor Corp., the world's biggest automaker in terms of vehicle sales, reported earnings on May 8.
- Casino tycoon Sheldon Adelson emerges as biggest US political donor over past two decades
- Donald Trump losing voter base and attacks Bubba Wallace on Twitter
- Illinois Governor Pritzker signs legislation into law, reducing taxes on Chicago integrated resort’s GGR
- Nebraska voters likely to face commercial Casino Ballot referendum in November 2020
- DraftKings signs deal with Casino Queen to offer sports betting services in Illinois
- Morongo Casino Resort employee tests positive for COVID-19 weeks after reopening
- MGM Resorts’ Excalibur Hotel & Casino in Las Vegas to reopen its doors on Thursday
- Nikola Motors stock jumps after the company announced electric truck reservation date
- Nevada’s El Cortez Hotel & Casino excited to welcome guests back after prolonged COVID-19 lockdown
- Fantasy Springs Resort Casino reopens its doors to the public
New Zealand News
- Bridge Investment ordered to stop work on Tinian Casino project due to lack of permits
- Philippines government warns public not to patronize illegal online gambling operations
- Eldorado Resorts’ capital raising plans could be catalyst to finalize $17.3bn Caesars deal
- BetConstruct obtains license to offer Sportsbook and Casino products in Swedish market
- SkyCity reports “encouraging” business since reopening of three casinos following COVID-19 shutdown
A study was conducted to evaluate the effect a...Read More
Tech biggie Google’s recent filing with the US...Read More
Docker CEO Ben Golub said in an earlier-this-week...Read More
In a blog post published on Thursday, Facebook’s...Read More
Tech giant Microsoft has announced the launch of a...Read More