TOKYO -- Different performances in U.S. showrooms sent profits at Honda Motor Co. and Nissan Motor Co. in different directions in the quarter that ended June 30.
Rising unit sales lifted Honda to record revenue and profit for the quarter. Nissan's vehicle sales fell. In turn, operating profit dropped 25.7 percent.
Honda's operating profit jumped 19.4 percent compared with the same quarter a year earlier to 203.52 billion yen, or $1.77 billion at current exchange rates. Revenue rose 14.8 percent, to $22.56 billion. Net income rose 29.6 percent, to $1.24 billion.
Honda's global car and truck sales rose 6.7 percent to a record 896,000. Strong sales of the Civic and Fit in the United States led the gain.
A favorable yen rate helped boost both companies' profits. Currency gains added $413.9 million to operating profit at Honda and $260.3 million at Nissan.
Currency gains helped Nissan's revenue rise 3.1 percent, to $19.18 billion. That occurred despite a 6.0 percent drop in global retail sales, to 826,000 units.
But the yen couldn't bail out Nissan completely. Overall operating profit fell 25.7 percent in the quarter, to $1.33 billion. Net income rose 4.2 percent to $956.3 million. A Mexican r&d tax credit for the expansion of a transmission plant kept Nissan's net from falling.
Despite the drop in operating profit, Nissan left unchanged its forecast for the full fiscal year to March 31, 2007. The decline was in line with expectations. Nissan predicts that full-year operating profits will rise 0.9 percent, to $7.64 billion.
The company is counting on the launch of eight new or redesigned models in various markets in the second fiscal half, beginning Oct. 1, to boost sales and profits.
In the United States, Nissan plans to begin selling a redesigned Sentra, Altima and Infiniti G35. It also will launch the Versa in the United States. In Mexico, the vehicle will be known as the Tiida.
Nissan faced one unexpected hit in the quarter that just ended. It set aside $119.6 million for warranty claims on its four-cylinder QR25 engine. About 97,000 Altimas and Sentra SE-Rs are equipped with 2.5-liter, four-cylinder engines, which can consume excessive oil.
You may e-mail James B. Treece at [email protected]