GO
Loading...

Honda slashes net profit forecast as China backlash hits

TOKYO, Oct 29 (Reuters) - Japan's Honda Motor Co cut its full-year net profit forecast by 20 percent after sales in China, the world's biggest autos market, were hit by a popular backlash against Japanese products last month in a dispute over East China Sea islands.

Honda cut its net profit forecast for the year to March 2013 to 375 billion yen from its earlier estimate of 470 billion yen.

Net profit for July-September increased 36.1 percent to 82.2 billion yen, but was below the average estimate of 107.2 billion yen from six analysts polled by Thomson Reuters I/B/E/S. A year ago, Japanese manufacturers were still reeling from the March earthquake and tsunami.

Demand for Honda, Toyota Motor and Nissan Motor cars slumped in China amid violent protests over the territorial dispute, with South Korea's Hyundai Motor and Germany's BMW picking up market share.

Sales by Honda and its China joint ventures dropped 40.5 percent in September. China is Honda's second-biggest market after the United States, accounting for 17 percent of its 2011 global sales.

Honda shares, valued at around $59 billion, fell 15 percent to near 9-month lows amid the China protests, but have since recovered, helped in part by a weaker yen.