Honda CEO Takahiro Hachigo said the company lost money in the fourth quarter.

Honda Motor Co. sold more vehicles during first quarter of 2019 than it did during the same period last year, yet reported a $118 million loss, or 13 billion yen, for its fiscal fourth quarter, the company reported.

The Japanese automaker cited unfavorable exchange rates, income tax expenses and other costs as the reasons for the quarterly loss. It reported a 107.7 billion yen profit during Q4 2018.

For the full fiscal year, the company reported a profit of $5.5 billion, or 610.3 billion yen, which is down 42% due largely to a lost tax break in the U.S.

Honda Motor Co. reported Wednesday a 13 billion yen ($118 million) loss for the fiscal fourth quarter, a reversal from a 107.7 billion yen profit the previous fiscal year. Quarterly sales rose 3% to 4.05 trillion yen ($37 billion).

(Honda recalling 1.1M vehicles to replace airbags. Click Here for the story.)

Consolidated sales revenue for the fiscal year (April 1, 2018 through March 31, 2019) amounted to 15,888.6 billion yen, an increase of 3.4% compared to the previous fiscal year and an all-time fiscal year record, due primarily to an increase in sales revenue from all businesses, the company reported.

Consolidated operating profit for the fiscal year amounted to 726.3 billion yen, a decrease of 12.9% compared to the previous fiscal year, due primarily to the impact to Europe related to changes of the global automobile production network and capability as well as unfavorable currency effects.

This was despite an increase in motorcycle sales in Asia, cost reduction efforts and the loss related to the settlement of class action litigation recorded in the previous fiscal year, Honda said.

(Click Here for more about Honda leading the fuel-economy pack.)

The company is looking to make changes, especially to its automotive operations. Chief Executive Takahiro Hachigo said the company will streamline its offerings, consolidating model variations, as well as finding ways to share parts across model lines to cut costs.

The first model produced using this new structure launches next year, he said.

“With this initiative, by 2025, we will reduce the total number of variations at the trim and option level for our global models to one-third of what we have now,” he said. “In addition, we will increase efficiency by eliminating and consolidating some similar regional models into even more competent models shared across multiple regions.”

(Click Here for more about Honda shutting down its lone UK plant.)

He added the company will electrify is products mainly with hybrid technologies. By increasing sales of our hybrid models all around the world, Honda will contribute to the global environment through the improvement of fuel economy, he noted. “To this end, we will expand the application of our i-MMD2 2-motor hybrid system to the entire lineup of Honda vehicles,” he said.

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