California Autos Examiner

Friday, July 25, 2008

Honda Rings the Register

Honda reports record 1st-quarter profit Detroit Free Press

Lately "earnings" reports have been anything but chipper. For many companies it's not a question of "Will they make a profit?" but "Just how much can they lose in three months?" None of this is a concern for Honda, which booked better-than-expected $1.68 billion in the April-June quarter, up 8.1% from the same period the previous year. Helping to float Honda's boat was strong demand in Asia and Brazil, counteracting the tough scene in the States and Japan. The company does caution that rising materials cost, strong yen and weak global outlook will impact performance.

Honda is still finding its way in the hybrid market and is preparing a fresh onslaught of product. Whether or not Honda's strategy of hybrid power for smaller vehicles and diesel motivation for heavier vehicles is the correct answer remains to be seen. Honda engineers express some skepticism about plug-in hybrids, saying that battery technology isn't ready yet. If Americans shun diesels and plug-in hybrids prove successful, then Honda could find itself in a spot of trouble.

Regardless of Honda's hybrid missteps, the rest of its product line and manufacturing flexibility continue to pay off handsomely. In addition to the aforementioned hybrids there's a new Fit and Acura TL coming this fall to the States and a diesel TSX should bow next year. Rumors persist that we could also see the shapely Honda Stream to battle the likes of the Rondo and Mazda5. For now, however, it's Cristal for everyone back at Camp Honda.

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