Sales strong at Japanese automakers despite some bumps

By: Yuri Kageyama
By: Yuri Kageyama

TOKYO (AP) -- Honda saw its profit slashed due to a tax dispute and Mitsubishi racked up costs for closing an Australian plant. But Mazda - the smallest of Japan's five biggest automakers - emerged unscathed Friday to report booming profits for the January-March quarter.

Honda Motor Co.'s quarterly net profit plunged 86 percent compared with the same period a year ago because of a corporate tax levied on its Chinese joint venture, at 25.4 billion yen ($244.2 million). Quarterly sales edged down 1 percent to 3.056 trillion yen ($29.4 billion).

Meanwhile, Mitsubishi Motors Corp.'s profit during the same period dropped 37 percent 13 billion yen ($125 million), despite a 12 percent rise in quarterly sales, to 734.8 billion yen ($7.07 billion).

Mitsubishi cited the closing of an Australian factory in the southern city of Adelaide earlier this year. It had operated the plant for 28 years.

Mazda Motor Corp. was an exception, reporting a 48 percent jump in profit on strong overseas sales on way to a record annual profit. The Japanese affiliate of Ford Motor Co. reported a 46.8 billion yen ($450 million) profit for the quarter through March, and a rise in quarterly sales of 1.2 percent to 969.5 billion yen ($9.3 billion), partly on strong demand for the Mazda 6 in Europe.

The recent rise in oil prices have prove a boon for Japanese automakers because of their focus on smaller, fuel efficient cars.

All three Japanese automakers that reported earnings Friday saw global sales grow during the fiscal year through March.

At Tokyo-based Honda, which makes the Civic compact and Odyssey minivan, fiscal year unit sales jumped 7.5 percent worldwide to 3.93 million vehicles.

Tax officials said Honda had underpaid for joint ventures with Chinese companies over a five-year span ended March 2006, but the nation's second-biggest automaker said it has been abiding by law. No agreement could be reached with the tax authorities.

Mazda, which makes the Demio subcompact and RX-8 sportscar, sold 1.36 million vehicles globally for the fiscal year just ended, up 4.7 percent from the previous year. It expects sales to keep growing, climbing 9 percent to 1.48 million vehicles in the fiscal year ending March 2009 worldwide.

Mitsubishi sold 1.4 million vehicles worldwide in the fiscal year ended March, up 10 percent from 1.2 million the previous year. Mitsubishi makes the Pajero and Outlander sport utility vehicles.

Japan's other two major auto companies, Toyota Motor Corp. and Nissan Motor Co., will report earnings in May.

In Tokyo, Honda shares gained 3.7 percent to close at 3,330 yen ($32), Mitsubishi Motors stock rose 1.2 percent to 163 yen ($1.57), and Mazda, based in the southwestern city of Hiroshima, shares gained 2.6 percent to 431 yen ($4.14).

Mitsubishi announced earnings before the end of trading. The others were disclosed shortly after the close of trading.

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