Honda’s annual profits are strong despite the chip crisis – Business & Finance

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TOKYO (Reuters) – Japanese auto giant Honda said on Friday its net profit rose 7.6% in the year to March, benefiting from strong motorcycle sales and a weaker yen .

The company also expects net profit to remain stable in the current fiscal year, even as the global shortage of microchips and virus-related supply chain disruption cause headaches for consumers. ‘automobile industry.

Honda said annual net profit rose 7.6% to 707 billion yen ($5.5 billion) in 2021-22 and issued a forecast of 710 billion yen in net profit for the year. until March 2023.

Last year, sales increased by 10.5%, he said, “mainly due to increased sales in the motorcycle and financial services businesses, as well as positive foreign currency conversion”.

But “despite shifting to a recovery trend, the economic environment surrounding the company, its consolidated subsidiaries and affiliates … remained challenging due to the impact of (the) shortage of semi-supply -drivers and rising raw material costs, among other factors.”

Honda said its factories in Japan and overseas had been forced to suspend or reduce production due to supply chain and personnel issues related to Covid-19. Toyota, the world’s top-selling automaker, also posted record full-year net profit this week, helped by strong sales and a cheaper yen.

The currency has touched 20-year lows against the dollar in recent weeks, inflating the value of Japanese automakers’ overseas earnings. Some analysts believe this will help them offset their current challenges.

In April, Honda announced it would invest nearly $40 billion in electric vehicle technology over the next decade as it strives to replace all sales with traditional fuel-powered cars.

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