Japanese automakers Honda Motor Co. (HMC) and Nissan Motor Co. (NSANY) have each reported big declines in their operating profits.
In Honda’s case, the vehicle manufacturer said its operating profit plunged by 76%. And that didn’t include the full impact of U.S. import tariffs.
Honda announced revenue of 5.36 trillion yen ($47.26 billion U.S.), which matched analysts’ expectations. Sales were up 6.2% from a year ago.
However, the company’s operating profit for the quarter ended March 31 totaled 73.5 billion yen, which badly missed the 275.52 billion yen that was forecast on Wall Street.
Honda’s net profit for its full fiscal year declined 25% to 835.84 billion yen.
While its motorcycle business achieved record sales and operating profit, Honda’s automobile business saw a big drop in sales, mainly in China and across Southeast Asia.
Honda’s results come amid trade tensions with the U.S., which has slapped a 25% import tariff on foreign vehicles.
In its earnings release, Honda, which is Japan’s second-biggest automaker after Toyota (TM), said that the impact of tariff policies would be very significant on its business moving forward.
Separately, Nissan reported fiscal fourth-quarter results that showed an even bigger plunge in operating profit.
Management at Nissan reported that its operating profit declined 94% year-over-year in the quarter to 5.8 billion yen, while revenue remained flat from the same period in 2024.
Nissan announced a quarterly net loss of 676 billion yen ($4.50 billion U.S.), compared to a 101.3 billion profit a year ago.
For the full fiscal year, operating profit fell 88% year-over-year to 69.8 billion yen, with executives blaming a decrease in sales and inflation. Revenue for the year was flat.
Nissan had earlier announced a plan to save 500 billion yen over the next few years, primarily through a headcount reduction of 20,000 workers.
The company is also consolidating its manufacturing plants to 10 from 17 by March 2028.
Honda’s stock, which trades in New York, is down 5% on news of its latest financial results. Prior to today (May 13), the share price had risen 9% this year to $30.93 U.S.
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