A Honda Motor cut its full-year profit forecast for the second time on Friday (5) as a persistent global semiconductor shortage forces vehicle production to cut and rising steel and raw material prices put pressure on profit margins.
“We believed that the shortage of supplies would be limited, but now we see that the shortage is more serious and will last longer,” the automaker’s executive vice president, Seiji Kuraishi, said at a news conference.
Honda was also dealing with increases in the cost of raw materials, including steel, which were difficult to pass on to consumers, he added.
Honda’s most recent operating profit forecast of 660 billion yen ($5.80 billion) for the year to March 31 is 15% lower than the forecast made in August and is below the average estimate of 764.5 billion yen from 20 analysts’ projections, according to Refinitiv data.
The number 2 assembler of Japan it also reduced its vehicle sales plan from 4.85 million to 4.2 million this business year, from 4.5 million in the previous 12 months.
Kuraishi said the company expects the shortage of chips decline after March and should not affect its plans to accelerate a shift to electric cars and other zero-emission vehicles.
During the three months to Sept. 30, Honda said operating profit fell nearly a third to 198.9 billion yen.
This result was higher than an average forecast of 183.5 billion based on estimates from nine analysts, according to data from Refinitiv.
Reference: CNN Brasil
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