Honda revises earnings due to Takata recall costs
Honda has officially restated its earnings for the fiscal year ending in March to cover costs of the expanded Takata recall campaign. The expansion hit Honda to the tune of a 19% drop in its operating profit compared to the previous fiscal year. Honda’s original profit of 651.68 billion yen ($5.3 billion U.S.) was revised down to 606.88 billion yen ($4.92 billion).
The revision was expected after the automaker announced the additional costs earlier in June.
The automaker spent an additional 44.8 billion yen ($362 million U.S.) to replace defective airbag inflators. Honda and Toyota have been particularly hard hit by the recalls, which affect an estimated 34 million vehicles sold in the US market.
Honda was recently pressured into a national expansion of its recall campaign by the National Highway Traffic Safety Administration (NHTSA). The 1.39 million inflators include the 350,000 defective parts outlined in the initial campaign.
Honda suggests several assocaited voluntary safety-improvement campaigns are being folded into the formal recall, which will collectively replace 2.3 million passenger-side front airbag inflators.