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Thursday, 29 January 2015

Honda recalls to squeeze profit, cloud guidance as cheap fuel poses new threat

File photo of a woman using her mobile phone as she walks past a Honda Motor Co. logo outside the company's dealership in Tokyo By Chang-Ran Kim TOKYO (Reuters) - As Japan's Honda Motor Co pays hundreds of millions of dollars to replace potentially deadly air bags, hitting earnings, a new headache lies around the bend - cheaper U.S. petrol could lure buyers away from its fuel-efficient cars. Still, Honda, like other affected automakers, expects to get those costs back eventually if investigations find Takata at fault. "The fall in fuel prices represents a body blow to Japanese automakers," said Merrill Lynch analyst Kei Nihonyanagi. Whatever the current quarter has in store for Honda, the earnings it reports for the third quarter of its fiscal year, due at 0600 GMT, will be hit by the Takata-related recalls.








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