TOKYO -- A weak yen and strong sales in China lifted the net profit of five Japanese automakers for the April-September period, while two others, Nissan Motor and Subaru, saw their profits dented by a safety inspection scandal.
The combined net profit of Japan's seven big automakers rose 21% on the year to 2.02 trillion yen ($17.8 billion) for the six-month period, according to figures released Wednesday.
The five automakers that posted higher net profits are Toyota Motor, Honda Motor, Suzuki Motor; Mazda Motor and Mitsubishi Motors.
The snowballing costs of recalls in connection with improper safety inspections led to net-profit declines at Nissan and Subaru.
A continued fall in the value of the Japanese currency has given the automakers' earnings a lift by increasing the yen value of their exports. At Toyota, the decline in the yen added 100 billion yen to its operating profit. The automaker now predicts an exchange rate of 111 yen to the dollar for the full year ending March 2018, down from 110 yen; Honda and Mazda also adjusted their assumed exchange rate to reflect the a weaker yen.
Brisker in China
Another positive for the Japanese automakers is higher sales in China. Mazda's sales in the country jumped 12%, while Nissan's climbed 7% on the year. These strong numbers offset a slump in the U.S., where the market has plateaued.
Suzuki's net profit was up 4% in the half year, buoyed by stronger demand in Asia, to reach an all-time high of 104.2 billion yen, while Mitsubishi Motors rebounded sharply from a net loss of 219.5 billion yen a year ago, to a net profit of 48.3 billion yen. India is a stronghold for Suzuki, while Mitsubishi Motors has a strong presence in Southeast Asia.
Toyota, Honda and Suzuki raised their net profit forecasts for the full year ending March 2018.
Honda's sales of motorcycles in emerging markets are brisk, while its auto sales in China are expected to increase.
Nissan cut its operating profit outlook for the year, while Subaru downgraded its net profit forecast by 21.5 billion yen.
(Nikkei)
