Honda ready to top market expectations

Robust sales growth in emerging markets has helped global automakers to weather a fall in mature markets such as Europe, and Honda has especially benefited from its lucrative and dominant motorcycle business in developing countries such as India.

But a convincing recovery in the US car market – Honda's biggest – is the main factor that has stoked optimism among investors, sending its shares up nearly a fifth over the past three months.

Honda, which fell behind Nissan Motor Co to become Japan's third-biggest automaker last year, raised its operating profit forecast for the year to March 31 to 620bn yen (4.75bn) from 500bn yen.

Japanese car makers have taken steps to improve manufacturing efficiency and reduce fixed costs to cushion the blow from the yen's rise.