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Honda profit surges 46%, slightly below forecast

2014 Honda Accord EX-L
Source: Honda Motor Company

Honda Motor second-quarter net profit rose 46 percent, slightly less than expected, after strong car sales in its biggest market, the United States, and motorbike sales in India and Thailand.

Japan's third-biggest automaker by sales volume said its July-September net profit totaled 120.4 billion yen ($1.23 billion), compared with 82.2 billion yen a year ago.

The result was below the average estimate of 134.9 billion yen in a Thomson Reuters I/B/E/S poll of six analysts.

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For the financial year ending in March 2014, Honda stuck to its forecast of 580 billion yen in net profit, below expectations of 610.8 billion yen in a Thomson Reuters I/B/E/S survey of 21 analysts.

Honda has been facing high costs of expansion to build new plants and lines as it aims to boost worldwide car sales to 6 million vehicles by end-March 2017, compared with a record 4.01 million in the year ended March 2013.

In July, Honda started to operate its new Yorii plant near Tokyo, where it is set in November to start manufacturing the redesigned Fit subcompact, which went on sale in Japan in September. Car sales in September in Japan jumped 40 percent from a year earlier to 74,779 vehicles.

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Honda, the fifth-biggest carmaker in the United States, sold 413,434 vehicles in that market in July-September, up 13.1 percent from a year ago.

Honda is the first of Japan's big three automakers to announce quarterly results. Nissan Motor, Japan's second-biggest carmaker, will report results on Nov. 5 and market leaderToyota Motor on Nov. 6.