Honda Reports Q4' 08 Loss

It's already been well established that no one is immune to this economic crisis, but the fact is same are faring better then others. VW and Hyundai are two volume automakers still managing a profit. For Honda, things have turned sour just like they have at rival Toyota. What's surprising though is the similarity to Honda's numbers and Ford's.

The Fourth Quarter is when everything turned really bad; Lehman Brothers, AIG. The whole September stock market crisis and the $700 billion bailout is when things took a dramatic turn for the worse. So naturally, that is when the companies would be posting their largest losses.

Ford for instance wants you to compare it's latest results from the cash burn in Q4, saying that it shows a huge improvement from the losses they were showing then. Ford's Q4 was disastrous, to the tune of $5.9 billion.

Apparently Honda's Fourth Quarter business cycle ends on March 31st. Other companies are reporting First Quarter but Honda is reporting fourth now....interesting. The loss comes out to $2.91 billion for the last quarter, but over the company's 1 year business cycle (ending on March 31st) they still managed to eke out a small profit. That's impressive; Honda is doing a lot better then it's other automakers.

While competitors Toyota and Nissan are both expecting continued losses for the year 2009, Honda expects to make a small profit, similar to the case in 2008. The company's motorcycle business is helping soften the losses in the automotive unit as well; motorcycle sales were up 8.5 percent.  

"In North America, I think we have hit the bottom, but it's still uncertain how we can rebound,"says Honda executive vice president Koichi Kondo.

I do think we have hit bottom in the automotive sector and that the recent injections of stimulus have to produce some kind of effect, whether it's as big as intended or not. In addition, the realities of the economic cycle indicate that normal business activity resumes over a period of time. I don't know about you, but I can't wait until things improve and the anxiety over our economic future ends.