Honda Motor Co.
) plans to recall 489,000 units of its popular sports utility
vehicle, CR-V, in order to fix the faulty power window switches.
Among them, 268,655 units will be recalled in the U.S.
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The recalled vehicles were manufactured between February 19, 2002,
through July 28, 2006. Nearly 265,000 of the vehicles were
manufactured at Honda's East Liberty plant, while the others have
been imported from Japan.
The Japanese automaker revealed that window switches could cause
electrical fires if rainwater or other fluids enter the switch
through an open driver's window and seep into the master power
window switch on the driver's door.
Honda has not yet received any reports of crash or injuries, except
four switch fires, due to the problem. The company will start
sending notification to the vehicle owners in early November. The
dealers will inspect the switches and repair them if necessary,
free of charge.
Automotive safety recalls were brought into focus by media after
) announcement of the largest-ever global recall of 3.8 million
vehicles in September 2009, triggered by a high-speed crash that
killed 4 members of a family.
Later on, a string of recalls has led Toyota to face numerous
personal injury and wrongful death lawsuits in federal courts. The
Transportation Department of U.S. had also imposed a fine of $48.4
million on the company due to late recall of millions of defective
Recently, Honda expanded its May recall to fix defective power
steering hose by including 572,000 units of Accord V6 midsize sedan
in the U.S. The vehicles belong to 2003-2007 model years. The May
recall for power steering hoses involved 56,881 units of 2007-2008
Acura TL sedans in North America.
From the beginning of 2011 till date, Honda's largest recall
included 1.5 million cars in the U.S. due to a problem with the
transmission system. The recall included CR-V (model year
2007-2010), Elements (2005-08) and Accords with 4-cylinder engines
Honda, a Zacks #5 Rank (Strong Sell), recorded more than a fourfold
increase in profits to ¥131.72 billion ($1.66 billion) or ¥73.09
(92 cents) per share in the first quarter of its fiscal year ending
March 31, 2013 from ¥31.80 billion or ¥17.64 in the comparable
quarter of 2011. However, the company's profits were lower than the
Zacks Consensus Estimate of $1.15 per share.
Consolidated net sales and other operating revenues surged 42.1% to
¥2.44 trillion ($30.71 billion), driven by higher revenues in the
automobile business with the recovery in production from the twin
disaster in Japan last year, and increased revenues in the
motorcycle business, despite unfavorable foreign currency
Consolidated operating profits increased significantly by 679.5% to
¥176.01 billion ($2.22 million) from ¥22.58 billion a year ago,
driven by higher sales volume and model mix, despite increased
SG&A and R&D expenses as well as unfavorable foreign
Honda has projected revenues to improve 29.6% to ¥10.30 trillion in
fiscal 2013. Operating profits are expected to increase 168.0% to
¥620 billion, net profits are anticipated to rise 122.2% to ¥470
billion and earnings per share are expected to be ¥260.78 for the