AutoBeta(AutoBeta.net)08/03 Report--

In the first half of this year, the domestic automobile market still showed a decline in sales due to the implementation of the sixth national emission standard and the subsidies for new energy vehicles. According to the China Automobile Association, domestic car sales fell 12.4% in the first half of the year compared with the same period last year, of which Chinese-branded passenger cars fell 21.7% year-on-year, with a market share of less than 40%.

After Geely, Great Wall and GAC GROUP cut their annual sales, Honda also cut its sales for the fiscal year due to weak market sales.

According to Reuters, Honda reported results for the first quarter of fiscal 2020. Honda's second-quarter operating profit fell 16% to 252.4 billion yen from 299.3 billion yen last year. Honda's first-quarter sales fell 0.7 per cent to Y4,000bn from 4.02 trillion yen last year, while operating profit fell 15.7 per cent to 252.4 billion yen, while net profit fell 29.5 per cent to 172.3 billion yen.

Honda cut its global car sales for fiscal 2020 to 5.11 million from last year's forecast of 5.16 million, down from 5.323 million last year, while Honda cut its forecast for full-year sales by 50 billion yen.

However, even in the face of a decline in performance, Honda expects operating profit to rise 6 per cent to 770 billion yen in fiscal 2020.

Honda believes that weak car sales in some overseas markets, such as the United States and India, and the increased costs arising from tax reform in the United States are the main reasons for lowering sales and profit forecasts, while sales in Japan are expected to decline slightly due to the increase in sales tax.

Like other carmakers, Honda has been stepping up business restructuring and investing in self-driving and electrified technologies in response to increasing competition from other technology companies.

In May, Honda said it planned to cut global production costs by 10 per cent by 2025 and would cut the number of derivative cars sold on the global market by 2/3 to save money on technology research and development.

In addition, Honda will also expand its partnership, join the joint venture mobile model company formed by Toyota Motor and Softbank Corp. Group, and invest in GM's self-driving car division to strengthen technological development.

Honda expects to be fully electrified in the European market by 2025 and plans to electrify 2/3 of its global lineup by 2030.

The relevant media said that although Honda has produced a large number of negative news and caused huge losses due to reasons such as Takata airbag and Accord stall, from the perspective of its development in recent years, Honda has stumbled, but it has made steady progress, and the pace of Honda Automation will also be promoted by strengthening cooperation among enterprises.

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