With COVID-19 pandemic restrictions in the rear-view mirror, Honda is back on track towards increasing profits. In 2023, it’s first-quarter profits for motorcycles and car sales took a big jump from 2022’s numbers. The reason? Production is returning to normal, sort of.
Honda says its worldwide 2023 Q1 profit for car and bike sales is 363 billion yen, which is $2.5 billion in American money, or about $3.4 billion in Canadian money. In 2022, Honda made 149 billion yen, less than half of this year’s numbers.
The secret to making more money? Simple—Honda says it made more cars and more motorcycles to sell! If you’ve been into a Honda motorcycle dealership over the past few years, you might have noticed a fairly light showroom. If you talked to sales staff, you might have heard frustration that they couldn’t get their hands on bikes to sell. A lot of that came from Honda’s inability to source electronic components for some of its popular models. If you’ve been paying attention, you’ve probably heard of global semiconductor shortages, and that hurt Honda (particularly in the mega-market of India) along with other companies.
But now, production is ramping back up for both the motorcycle segment and the automotive segment, and Honda sold 901,000 vehicles in 2023’s first quarter (April through June) versus 815,000 cars and bikes over the same Q1 in 2022. As many of those vehicles were profit-loaded cars, more money came into Honda’s coffers.
Global money market shifts also benefited Honda, as did Honda’s own in-house financial services. Company-arranged loans are always a big earner for the moto manufacturers, and as the cost of living increased over the past year, it seems an increased reliance on financing was a benefit for Big Red. As to what’s ahead? The Japanese stock market reacted negatively, with a drop in Honda’s stock value, but with models like the CB750 Hornet coming to more customers soon (see title image), Honda still has machines that customers want, in big numbers, as long as they can source the components to build them.
