Sales strong at Japanese automakers despite potholes

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

Honda Motor Co.'s hmc quarterly net profit plunged 86% compared with the 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% to 3.056 trillion yen ($29.4 billion).

Meanwhile, Mitsubishi Motors Corp.'s mmtof profit during the same period dropped 37% 13 billion yen ($125 million), despite a 12% 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. mzdaf was an exception, reporting a 48% jump in profit on strong overseas sales on way to a record annual profit. The Japanese affiliate of Fordf reported a 46.8 billion yen ($450 million) profit for the quarter through March, and a rise in quarterly sales of 1.2% 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 proved 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 Honda, which makes the Civic compact and Odyssey minivan, fiscal year unit sales jumped 7.5% worldwide to 3.93 million vehicles.

Tax officials say Honda had underpaid for joint ventures with Chinese companies over a five-year span ended March 2006, but the nation's second-biggest automaker says 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% from the previous year. It expects sales to keep growing, climbing 9% 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% from 1.2 million the previous year. Mitsubishi makes the Pajero and Outlander sport-utility vehicles.

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

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

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