LeftLaneNews

Honda isn't making any profits on models imported into the US: CFO

Honda will reduce US shipments of vehicles made in Japan due to non-existent profits.

Honda Motor Company is carefully monitoring and allocating shipments of its cars built in Japan and imported into the US because it's losing money on them, Chief Financial Officer Fumihiko Ike said. These include the Fit hatchback and the CR-Z and Insight hybrids. The result is that some dealers aren't getting enough vehicles.

The exchange rate is what's hurting the profits of these models, Ike said in an Automotive News report. As such, he said exports of these models to North America will be decreased. For the long-term, Honda needs to source more parts from North America, including hybrid powertrain components. But the Japanese automaker is better protected against such currency difference than some competitors, as it builds about 85 percent of all the vehicles it sells in North America locally.

Ike side the exports need to continue in order to cover segments and keep customers, while at the same time satisfying dealers.

Production of the Fit will be moved to a new Mexican plant that's due to open in 2014. The Fit made up nearly a third of Honda's imports into the US in 2010 and 2011. Ike said the Fit doesn't make any profit for Honda. On a much smaller scale, some CR-Vs, hybrids, and Acura models are imported from Japan.