Slashing output and scuttling programs apparently isn’t enough to help Honda weather the current economic storm. The Japanese automaker reported a $2.91 billion loss for the first quarter of 2009, marking its first quarterly loss in 15 years.
That’s a sizable tumble from last year, when Honda posted a $1.75 billion profit in the first quarter of 2008. While adverse exchange rates hurt the company’s operating income, the downfall stems largely from a global sales slump, most of which occurred in North America. Across the world, Honda managed to sell 680,000 vehicles in the first quarter of 2009, down 35.3 percent from 2008. In North America, however, sales were nearly halved – only 219,000 vehicles were sold, in stark contrast to 459,000 units last year. Things don’t look rosy for Honda in the near future, either. Executive vice president Koichi Kondo expected the firm’s net income to fall 70.8 percent by the year’s end. Should conditions continue to falter, Honda could post its first full-year loss since the company was founded in 1948. Source: Automotive News