Japan’s Honda reports a nearly 9% increase in profit, driven by strong demand for its motorcycles and cars.

TOKYO (AP) — Honda reported an 8.7% increase in profit for the April-June quarter, attributing the rise to strong sales of hybrid vehicles in Japan and the U.S., as well as motorcycles in India and Brazil.

Honda Motor Co. earned 394.7 billion yen ($2.7 billion) during the last quarter, up from 363 billion yen a year earlier. Quarterly sales increased nearly 17% to 5.4 trillion yen ($36.7 billion).

The company benefited from a favorable currency exchange rate, which added approximately 48 billion yen ($326 million) to its operating profit. The weak yen, which was trading above 150 yen to the U.S. dollar during the quarter, helped boost profits for Japanese exporters like Honda, although it recently declined to about 147 yen.

However, Honda faced challenges from intense price competition in China and the rapid shift to electric vehicles in the region. The company is adjusting its production to keep pace with these changes.

In the U.S., concerns persist about the value depreciation of newly purchased electric vehicles, including Honda’s models. Despite these issues, Honda is maintaining its fiscal year forecast of 1 trillion yen ($6.8 billion) in profit, slightly down from 1.1 trillion yen the previous year, with sales projected at 20.3 trillion yen ($138 billion), down from 20.4 trillion yen.

Motorcycle sales in Thailand have declined due to the country’s weak economy, but overall sales are strong in India, Brazil, and North America. Honda anticipates selling about 2.97 million vehicles and 13 million motorcycles globally in the fiscal year ending March 2025, maintaining levels similar to the previous year.

In contrast, Nissan Motor Co. has recently reduced its annual profit forecast due to declining profits despite steady sales, while Toyota Motor Corp. reported record profits, boosted by a favorable exchange rate.