Honda's Profit Plunges 96 Percent

Honda reported a 96 percent drop in first quarter profit to 7.5 billion yen ($79.8 million), the automaker's first earnings drop in four years, but raised its full-year forecast.

Honda Motor Co. said Wednesday falling car sales and a strong yen hurt its bottom-line.

The results for the April-June period were better than the flow of red ink analysts had forecast and show how Japan's No. 2 automaker, reputed for ecological small cars, appears to be holding up better than rivals.

Tokyo-based Honda raised its forecast for the full year through March 2010 to a 55 billion yen ($585.1 million) profit, an improvement from its earlier forecast at 40 billion yen ($425.5 million). Other Japanese automakers are forecasting deep losses for the full fiscal year.