Honda Corporate Update 2014 Spring

Fit (US) 1

Honda Corporate Update Honda FY2011 Rating Review

 Honda Business Status  Business Strategy Automobile Operations Motorcycle Operations

 FY14 Financial Highlights

2

Profit Structure Profile over Past Decade and FY15 Forecast Profit structure and Strong Recovery in FY13 Honda makes strong recovery from global economic shock and natural disasters

USD/JPY 12%

1,200

(Billion)

O/P margin 1,000

10%

8.8%

7.7%

7.9%

800

・Japan Earthquake ・Thai Flood

・ Lehman Shock

600

6.5%

5.5%

8%

6.3%

6.0%

4.2%

Automobile

6%

2.9%

400

4%

1.9% Motorcycle

200

2%

Finance 0

0%

FY06 -200

FY07

FY08

FY09

FY10

FY11

FY12

FY12

FY13

FY14

FY15(P) -2%

3

Current Fiscal Year Projection Sales growth and cost reduction will contribute to a rise in operating income Top-line growth and cost reduction

SG&A Expenses R&D Expenses

Yen (billions)

+175.7

- 87.0

FOREX Effects

- 12.0

Rev/Mix +125.7 C/R +50.0

Operating income

750.2

-67.0

Consolidated Unit Sales Growth Auto 3.56 → 3.87 mil (+8.7%) M/C 10.34 →11.03 mil (+6.6%)

Operating income,

Operating income

excluding forex effects

760.0

FY3/15(P)

FY3/14

(as of Apr. 25) FY14

FY15(P)

Capital Expenditures

726.1

650.0

- 76.1

Depreciation and Amortization R&D expenses

375.8 634.1

415.0 645.0

+ 39.2 + 10.9

Change

4

Current Fiscal Year Projection Consolidated Unit Sales Automobiles Units

Japan Japan Full year contribution of Fit, Vezel, N-WGN, and Odyssey vehicles launched in 2H FY14

(excluding China)

3,870 3,560 N-WGN (Nov 2013)

Fit (Sep 2013)

VEZEL (Dec 2013)

Odyssey (Oct 2013)

More new hybrid and mini vehicles to debut in 2H FY15

+ 310

US US

( + 8.7 %)

Accord, Civic, and CR-V continue to grow as retail sales leaders in their respective segments HR-V

Introduction of fully remodeled Fit and all-new HR-V Further growth of Acura SUVs FY14

All new TLX will debut in 2014

FY15

FY14

FY15

Results

Forecasts

Change

812

980

+ 168

+20.7%

North America

1,757

1,810

+ 53

+3.0%

Europe

169

170

+0.6%

Asia

529

640

+1 + 111

+21.0%

Other Region

293

270

- 23

-7.8%

3,560

3,870

+ 310

+8.7%

Japan

Total

MDX

(RDX: 24 consecutive monthly sales

records since launch)

Asia Asia India Jan-Mar sales in India Strong growth from Amaze and City(Jan 2014) All new Honda Mobilio will debut in the middle of 2014 2nd plant opened in Feb 2014 Indonesia Newly launched Brio Satya(Nov 2013) and Honda Mobilio (Jan 2014) to cultivate new segments for Honda 2nd plant started operation in Jan 2014

Jan-Mar sales in Indonesia

5

Honda Corporate Update Honda FY2011 Rating Review

 Honda Business Status  Business Strategy Automobile Operations Motorcycle Operations

 FY14 Financial Highlights

6

Core Strategies GrowthRating in Automobile Operations Honda for FY2011 Review

Global Global Operation Operation Reform Reform •• Regional Regional Concurrent Concurrent Development Development •• Locally Locally Optimized Optimized Design/ Design/ Increase Increase in in Local Local Procurement Procurement •• Higher Higher Production Production Efficiency Efficiency

(Highly (Highly efficient efficient and and fun fun to to drive drive powertrain powertrain technologies) technologies)

Global Global Core Core Models Models & &

New New Models Models for for Uncultivated Uncultivated Markets Markets

Sustainable Sustainable & & Profitable Profitable Growth Growth

7

Earth Dreams Technology Honda introducing full line-up of new engines and transmissions New New diesel diesel engines engines

Full Full range range of of new new gasoline gasoline engines engines Minivehicle

1.5L class 1.8L class engine engine

2.4L class engine

3.5L class V6 engine

1.5/1.6L class engines

New New CVT CVT transmissions transmissions Minivehicle

Compact vehicle

Mid-sized vehicle

New 3.5L Direct Injection i-VTEC Engine

New 660cc

MDX

RLX

New 2.4L Direct Injection i-VTEC+ CVT Accord

New 1.6L Diesel Engine (Civic and CR-V, Europe) N Box

New 1.5L Diesel Engine (Amaze, India)

New 1.5L Diesel Engine (City, India)

2.4L 27 mpg (city) 3.5L 21 mpg (city)

New 1.5L Direct Injection Engine + CVT Fit

CY2011

2012

2013

Vezel

2014

8

Earth Dreams Technology Enhance Enhance Hybrid Hybrid Line-up Line-up

Intelligent Dual-Clutch Drive (i-DCD) One-Motor Hybrid system Global Compact series INTEGRATED MOTOR ASSIST

CR-Z

Freed / Spike Hybrid

Civic Hybrid

Sports Hybrid Intelligent Multi-Mode Drive (i-MMD) Two-Motor hybrid system Fit/Jazz Hybrid

Fit Shuttle Hybrid

mid-to-large sized vehicles Acura ILX Hybrid

Plug-in Hybrid

Jan 2013

2010

2011

Accord Hybrid Jul 2013 (Japan)

2012

Three-Motor Sports Hybrid SH-AWD system for Acura models RLX

NSX

9

Earth Dreams Technology

Balances outstanding environmental performance with FUN

Realizes outstanding dynamic performance for motorsports enthusiasts

10

Safety Leadership Honda is responsible for numerous pioneering efforts in passive safety, including the areas of crashworthiness, airbag technology and collision compatibility.

Overall Safety Performance (U.S.) 8 Honda or Acura vehicles have earned either Top Safety Pick or Top Safety Pick + ratings. First compact car to earn Safety Pick + rating

Competitor Competitor Only minivan to achieve Safety Pick + rating

Competitor Competitor Competitor

*The Top Safety Pick is an annual award to the bestperforming cars of the year by the Insurance Institute for Highway Safety (IIHS). To receive a Top Safety Pick, the vehicle must receive "Good" overall marks in the moderate overlap front, side, roof strength and seat head restraint tests, regardless of their rating in the small overlap front test. The Top Safety Pick+ award is given to vehicles that receive good rating in at least 4 of 5 tests and no less than acceptable in the fifth test. (IIHS rates vehicles good, acceptable, marginal or poor)

Competitor Competitor Competitor Competitor 0

1

2

3

4

5

6 (Feb. 2014)

7

11

Global Automobile Production Capacity (Unit : 1,000)

CY2014

CY2013

+450 +450

4,575

5,000

+160 +160

150

+20k 4,000

870

Dongfeng, Dongfeng, China China

150

Other

150

890

China

890

300

Malaysia

300

+90k

2,000

1,630

1,720

Brazil

+240k

+120k India (Feb 2014)

+50k

3,000

+120k

4,735

675

625

5,185

Asia 925

Guanqi +120k Dongfeng +120k

+130k Indonesia (Jan 2014)

300

+200k

1,920

Europe

+120k Thailand

North America

New New plant plant in in Mexico Mexico (Feb (Feb 2014) 2014)

Alabama Alabama +40 +40 Indiana Indiana +50 +50

1,000

1,000

1,000

+α

+α

2012

2013

0

End of

Yorii Plant

1,000

Japan

+α 2014

Capacitytoincrease 5.7 mil Global capacity to increase over 5.1tomillion units by end of 2014 12

Global Operation Reform Concurrent Concurrent development development in in all all six six regions regions Japan, Japan, North North America, America, South South America, America, Europe, China, Asia Europe, China, Asia

Introduction of model globally Simultaneous large volume production Significant cost reduction through global sourcing

Adoption Adoption of of locally locally optimized optimized design design Respond to the voice of local customers Utilize more local suppliers

Improvement Improvement of of production production efficiency efficiency New plants dedicated to compact vehicle production •Yorii Plant in Japan ( July 2013 ) •Mexico factory ( February 2014 )

Global operation reform to be implemented beginning with all-new Fit series 13

Global Compact Series Honda FY2011 Rating Review Honda’s Global Compact Series to be rolled-out globally within two years with best-in class Fun Driving Performance, Fuel Economy, Packaging and Safety

(City)

(Fit/Jazz)

Highest volume among Honda line-up Fit / City accounted for about 18% of Honda global unit sales in 2013

(HR-V/Vezel)

Fit and Vezel sales in Japan (units) New Vezel

(Monthly unit sales in Japan)

4500

★

4000

(‘000 units)

Fit / City

3500

Fully Remodeled Fit

753

3000

4.27

2500

mil

2000

CY2013

★ CR-V

741

Hybrid

1500

Accord 1000

Civic

691

684

GAS

500

2013

2012

2011

2010

2009

2008

2007

2006

2005

2004

2003

2002

2001

2000

1999

1998

1997

1996

1995

1994

1993

0

14

North America Automobile Operations (U.S.) Industry Demand

Unit (thousands)

Honda Unit Sales

Unit (thousands)

2,000

Passenger Cars Light Trucks

Acura Honda Passenger Cars Honda Light Trucks

20,000 16,556

1,500

16,148

14,491 13,300

1,509

1,551

1,525 1,422

1,428

15,600 1,150

12,778 11,588

1,230 1,147

1,000

10,429

10,000 500

0

0 CY 06

07

08

09

10

11

12

13

Further Honda Growth New model launches with new engines and new transmissions - Fully remodeled Fit launched in April 2014 - All new Compact SUV, HR-V to debut this coming winter - New Acura TLX to be launched in 2014

CY 06

07

08

09

10

11 12 13 Source: Honda

New Model Launches/ FMC

Accord (Sep 2012)

Acura RLX (Mar 2013)

Acura MDX (June 2013)

Accord Hybrid (Oct 2013)

 Expand N.A. production capacity to start local production of next-generation Fit and new HR-V (Feb 2014) Fit (Apr 2014)

Acura RLX Hybrid (in 2014)

ACURA TLX (in 2014)

HR-V (in FY2015)

15

North America Automobile Production Capacity Focus on Compact Vehicles

Mexico Mexico

Focus on Small Vehicles  New plant start-up in February of 2014

Canada Canada

Indiana Indiana

Capacity: 390k

Capacity: 250k

with capacity of 200k units  Created specifically to build Global Compact Series Models

Fit

Capacity: Existing 60k / New 200k (Total 260k)

Ohio Ohio

• Focused on Mid-size Vehicles • Plants to introduce advanced technologies Capacity: 680k (MAP 440k / ELP 240k)

Alabama Alabama

Total Production Capacity Current 1.72mil → 1.92mil in 2014 More than 95% of the vehicles sold in the U.S. produced in North America

Focus on Light Trucks

Capacity: 340k  Acura MDX production added in June, 2013 16

New Models in US Focus on Compact Vehicles

201X Mid-size Vehicles

201X

201X

Light Trucks

201X

Sub-compact Vehicles

New models for uncultivated segments

HR-V (FY2015)

Accord (2012)

Source more from Mexico

2012

2013

Fit (FY2015)

2014～

CY2013 US unit sales % by model

New models to be launched with new technologies and competitive cost structure 17

ACURA Strategy New Models with Advanced Technologies  All-new Direct injected engines  All-new transmissions (include 8DCT and 9AT)  Three-Motor Sports-Hybrid SH-AWD

Unit Sales in the U.S. (‘000)

199

210

201 180 156

145 134

TSX

165

123

106 TL RDX MDX

New Organization to focus more on Acura business

18

Japan Automobile Operations Industry Demand

Honda Unit Sales

Unit (thousands)

Unit (thousands)

Mini vehicle

Registered vehicle

5,692

6,000 5,320 4,701

4,880

Registered vehicle

1,000

Mini vehicle

848

5,210 4,601

4,753

750

716 662

640

609

580

4,000

601

500 2,000

250 N BOX (Dec 2011) N-One (Nov 2012) N-WGN (Nov 2014)

0

0 FY08

FY09

FY10

FY11

FY12

FY13

FY14

FY08

FY09

FY10

FY11

Source: JAMA

Strategy for Japan Market

FY12

FY13

FY14

Source: Honda

New Model Launches/ FMC

Efficient enhancement of product line-up - Launch of 3rd generation Fit and new small SUV Vezel in 2013 - Launch of new mini vehicle “N” series, N-WGN + 4 new models by 2015

N-One (Nov 2012)

Accord Hybrid (Jun 2013)

Odyssey (Oct 2013)

N-WGN (Nov 2013)

- Strengthen minivan and sedan line-ups

Fit (Sep 2013)

Restructure domestic production facilities - Yorii: production line with advanced technologies for small vehicles - Sayama: flexible production line can produce more than ten models - Suzuka: dedicated to mini vehicle production

Vezel (Dec 2013)

19

Japan Automobile Production Innovation Yorii Plant  Started production in July 2013  Dedicated to the production of small-sized vehicles  Capacity : 250k units / year

Yorii Plant employs a number of innovative technologies and is a world-leading energysaving plant. Example of Innovative Technologies Honda Smart Ecological Paint (Yorii is the first plant to use this technology and it will be introduced to other new plants. A highly-functional painting technology that eliminates a middle coating process from a commonly used 4-coat/3-bake auto body painting process to realize a 3-coat/2-bake water-based painting process.

3-coat/2-bake

4-coat/3-bake (Conventional painting process)

(Honda Smart Ecological Paint)

• Reduction of the amount of paint materials • 40% reduction in the number of processes • 40% reduction of the amount of CO2 emitted during painting process

Image of test painting

This new technology enables Honda to reduce the cost of paint materials, processing costs and equipment costs 20

Asia Automobile Operations (ASEAN) Honda Unit Sales

Industry Demand Unit (thousands)

※Retail Sales

Unit 400(thousands)

3,500

3,280 Malaysia

Thailand

Indonesia

Philippines

3,298

Thailand

Indonesia

Philippines

367

350

3,000

283

300

2,388

2,500

Malaysia

234

2,294 250

190

1,895

2,000

177 1,704

1,671

189

200

146

1,500 150

1,000

100

50

500

0

0 CY07

08

09

10

11

12 13 Source: Honda

Strategy for ASEAN Market New “Brio Satya” launched to meet requirements of Low Cost Green Car (LCGC) program. “Honda Mobilio” launched in the low-price MPV category, which is the biggest volume segment in Indonesia. New small sedan “Brio Amaze” launched Fully remodeled “City” launched 3rd generation “Jazz” to be introduced

CY07

08

09

10

11

12

13

Source: Honda

New Model Launches/ FMC

Brio Amaze, Thailand Accord, Thailand (Nov 2012) (Mar 2013)

Brio Satya, Indonesia (Nov 2013)

Honda Mobilio, Indonesia City, Thailand, Malaysia, Philippines (Jan 2014) (Jan 2014~)

21

Asia Automobile Operations (India) India Industry Demand (excluding commercial vehicles) Unit (thousands)

Diesel

Honda Unit Sales in India Unit (thousands)

Gasoline

※Retail Sales

120 3,000

2,618

105

2,686

2,502

2,501

100

2,500

71 1,951

63

80

63

2,000

53

1,553

50

60 1,500

40 1,000

20 500

0

0 FY09

FY10

FY11

FY12

FY13 FY14 Source: SIAM, Honda

Strategy for India Market New models to be launched into untapped segments

CY08

CY09

CY10

CY11

CY12

CY13

Source: Honda

New Model Launches/ FMC Earth Dreams Technology 1.5L i-DTEC Diesel Engine

- Amaze debuts with new 1.5L diesel engine in 2013 - City launched in 2014 - 4 new models (including FMC) to be launched in 3 years Expansion of dealer network Expansion of automobile production capacity - 2nd automobile factory started production in February 2014

Amaze (Apr 2013)

City (Jan 2014)

Honda Mobilio (2014)

22

New Model Strategy in China SDN(4D/5D)

Segment

Accord

Guangqi

(2013 FMC)

D

(in 2014) Elysion (current model)

Concept M** (in 2015)

(2013) Civic

CR-V

Fit (FMC in 2014)

City

Concept B Dong Feng

**

Concept M

Crider

C

B

Crosstour

(FMC in 2014)

Guangqi

Guangqi

MUV Odyssey (current model)

Spirior

Dong Feng

Dong Feng

SUV

(in 2016)*

Vezel

(in 2014)

Concept V

Jade (2013)

Accord etc.

Civic CR-V Jade etc.

Fit City etc.

(in 2015)

* the joint venture partner for concept B is TBA **two different models based on Concept M will be introduced by both joint venture partners

CY2013 China Unit Sales by Platform

By utilizing common platform and strengthening of local R&D functions, 9 cost competitive models will be launched within 2 years (2014～2015) 23

Honda Corporate Update Honda FY2011 Rating Review

 Honda Business Status  Business Strategy Automobile Operations Motorcycle Operations

 FY14 Financial Highlights

24

Motorcycle Market Size and Honda Share (CY2013) Vietnam 2.7 million Thailand 2.0 million

68% 78% (CY2012: 76%)

(CY2012: 62%)

Indonesia

61%

India

7.7 million

22%

14.3 million

(CY2012: 58%)

Brazil 1.5 million

80% (CY2012: 80%)

(CY2012: 18%)

25

Asia Motorcycle Operations (India) Expansion Plan Annual Capacity : 4.0 Manesar Rajasthan Gujarat

3rd plant Bangalore

 Expand capacity to meet growing demand  Introduce new 110cc models

1.2

4.6mil 4.0mil

3rd 1.2

1.8

1.8

1.8

2nd 1.2

1.2

1.2

1.2

1st 1.6

1.6

1.6

1.6

2014(P)

2015(P)

2016(P)

2013

Future Future Honda Honda Growth Growth

5.8mil

Production start in 2nd half of FY2015

1st plant 2nd plant 4th plant

mil → 5.8 mil

Product -up Product Line Line-up Honda introduced new 110cc Motorcycles into Indian Market

Following Dream Yuga and Dream Neo, Honda will introduce new 110cc models

 Improve fuel economy of scooter models

110cc AT-Scooter

Dream Yuga

Dream Neo

Activa

(Apr 2012)

(Apr 2013)

26

Asia Motorcycle Operations (Indonesia) –Sales Results and Respective Fuel Injection (FI) ratios

2009

2012 1%

29%

Total 270

3rd

2.4

2.2

2nd

1.0

1.0

1st

1.0

1.0

2012

2014(P)

BEAT-Fi Applied FI to all models by end of FY 2014

4th plant will start operations in 2014 with an annual production capacity of 1.1 million units

5.3mil 1.1

100%

Total 409

– Capacity Expansion

4.4mil

FY2014

4th Spacy FI

27

Honda Corporate Update Honda FY2011 Rating Review

 Honda Business Status  Business Strategy Automobile Operations Motorcycle Operations

 FY14 Financial Highlights

28

Outline of FY14 Results Summary (Consolidated) Results Summary Operating income amounted to 750.2 billion yen, an increase of 37.7% mainly due to increased automobile unit sales in Japan and North America and increased motorcycle unit sales in Asia, as well as continuing cost reduction efforts and favorable currency effects. 12 months results FY13 and FY14 Consolidated Unit Sales 6,500

13,000

11,842.4

10,343

6,071 6,036

3,560 6,000

10,000

9,510

FY14

Net Sales / Operating Income

Unit (thousand)

3,800

11,000

FY13

11,000

9,877.9

750.2

800

600

Yen (billion)

544.8

3,408 3,400

9,000

400

7,000

200

5,000

0

5,500

9,000

8,000

3,000

Motorcycles

5,000

Automobiles

Power Products

Net Sales

Operating Income

29

FY14 Financial Results (consolidated) 12 Months

Financial Results Yen (billion)

Net sales

FY13

FY14

Change

9,877.9

11,842.4

+ 19.9%

544.8

750.2

+ 37.7%

Operating Margin

5.5%

6.3%

Income before income taxes

488.8

728.9

+ 49.1%

Equity in income of affiliates

82.7

132.4

+ 60.1%

367.1

574.1

+ 56.4%

203.71

318.54

+ 114.83

Operating Income

Net Income EPS (Yen)

*1

*2

-

Average Rates (Yen) US Dollar Euro 12,000

11,842.4

10,000

9,000

100

108

136

750.2

800

600

11,000

84

544.8

Yen down by16 yen Yen down By28 yen

8,000

728.9

Financial Summary -Revenue increased by 19.9% mainly due to increased revenue from automobile and motorcycle business operations, as well as favorable foreign currency translation effects. -Operating income increased by 37.7% due primarily to an increase in sales volume and model mix and continuing cost reduction efforts as well as favorable foreign currency effect, despite increased SG&A and R&D expenses. For *1 and *2, please refer to footnotes on page 42 FY13 800

200

132.4

6,000

FY14

Yen (billion)

574.1

600

488.8

400

4,000

200

2,000

0

0

100

82.7

400

367.1

9,877.9

Net Sales

Operating Income

200

Income before Income tax

0

Equity in income of affiliates

0

Net Income

30

Outline of FY14 4th Quarter Results Summary (Consolidated)

Results Summary Operating income amounted to 165.2 billion yen, an increase of 21.5% mainly due to increased automobile unit sales in Japan, increased motorcycle unit sales in Asia, and continuing cost reduction efforts, as well as favorable foreign currency effects. 4th Quarter Results FY13 and FY14 Consolidated Unit Sales 2,730

2,800

2,490

Net Sales / Operating Income

Unit (thousand)

1,000

902

FY13

933

2,100

Yen (billion)

200

1,963

900

FY14

1,990

3,097.2 3,000

2,500

2,744.9

165.2 150

1,900

135.9

800

100

2,200

700

1,700 1,900

2,000 50

600

1,600

1,500

500

Motorcycles

Automobiles

Power products 汎用事業

0

1,000

Net Sales

Operating Income 31

FY14 4th Quarter Financial Results (Consolidated) Financial Results

4Q Results ( 3 Months ) FY13

FY14

2,744.9

3,097.2

+ 12.8%

135.9

165.2

+ 21.5%

Operating margine

5.0%

5.3%

Income before Income Taxes

98.0

174.7

+ 78.1%

Equity in Income of Affiliates

13.0

37.3

+ 185.8%

Yen (billion)

Net Sales Operating Income

Change

-

Net Income

*1

75.7

170.5

+ 125.1%

EPS (Yen)

*2

42.03

94.61

+ 52.58

Financial Summary - Net sales and other operating revenue increased by 12.8% mainly due to a rise in automobile and motorcycle net sales as well as the positive impact of foreign exchange effects

- Operating income increased by 21.5% mostly due to a rise in income associated with changes in sales volume and model mix, cost down effects as well as the positive impact of a weaker yen, despite increased SG&A and R&D expenses as well as higher depreciation costs.

Average Rates (Yen) US Dollar Euro

93

103

122

141

Operating Income

200

Yen (billion)

228.5

250

184.9

176.0

171.4

FY13

For *1 and *2, please refer to footnotes on page 42

Operating Margin 8%

7.2%

FY13 FY14

7.6% 5.9%

5.3%

6%

6.5%

135.9 4%

100.8

100

FY14

165.2 131.9

150

Yen down by 10 yen Yen down by 19 yen

5.0%

5.4% 4.4%

2% 50

0%

0 1Q

2Q

3Q

4Q

1Q

2Q

3Q

4Q

32

Change in Income before Income Taxes Income before Income Taxes Operating Income -Increase in sales volume and model mix, etc.

+ 27.1

Yen (billion)

+ 76.6 （ + 78.1 % ）

+ 29.3 （ + 21.5 % ）

Other Income & Expenses

+ 47.3

- Cost reduction efforts, etc. - Increased depreciation costs, etc.

+ 27.5

174.7

- 39.8 + 19.8

+ 39.4 Cost Reduction, etc.

98.0

- 26.2 Increase in SG&A

Revenue, model mix, etc.

Operating Income

135.9 FY13 4Q

・Reversal effect of insurance gain in previous year ・Increase in warranty cost

Increase in R&D

+ 28.9

Unrealized gains and losses related to derivative instruments Currency (Attachment 2) Effects

- Currency effects due to difference between average sales rates and transaction rates - Other

Other

+ 31.3 - 3.7 Operating Income

165.2 FY14 4Q *Please refer to Attachment 1 regarding currency effects

33

Change in Income before Income Taxes Income before Income Taxes Operating Income

Yen (billion)

+ 240.0 （ + 49.1 % ）

+ 205.4 （ + 37.7 % ）

Other Income & Expenses

+ 34.5 -Increase in sales volume and model mix, etc.

+ 53.3

488.8

- Cost Reduction efforts, etc. - Increased depreciation costs, etc.

+ 15.0

544.8

+ 288.7

728.9

Other

- 102.3

Cost Reduction, etc. Revenue, Increase in model mix, etc. SG&A

- 49.3

・Increase in advertisement expense ・Reversal effect of Insurance gain in previous year ・Increase in General and Administrative expenses ・Increase in warranty costs

FY13 Twelve Months

- 39.8

Unrealized gains and losses related to derivative instruments (Attachment 2)

Increase in R&D

Operating Income

+ 74.4

Currency Effects

- Currency effects due to difference between average sales rates and transaction rates - Other

*Please refer to Attachment 1 regarding currency effects

- 23.1 - 16.7 Operating Income

750.2 FY14 Twelve Months

34

Operations by Business Segment Yen (billions)

Motorcycle Business

=Operating Income 22%

=Operating Margin

70

17%

13.6%

50

13.6%

9.6%

38.9 10.9% 8.5%

8.4%

30

10.7%

10.6%

9.6%

9.8%

12% 8.6%

9.2%

9.6%

8.2% 7.4%

32.8

5.8%

10.9%

6.7%

7%

3.4%

10

2.2%

2% 5.6

-10

9.3

15.8

28.0

31.3

30.0

29.1

48.1

44.9

25.8

36.8

25.4

22.8

25.2

42.5

45.5

34.5

42.9

-3% FY10 1Q

2Q

3Q

Yen (billions)

4Q

FY11 1Q

2Q

3Q

4Q

FY12 1Q

2Q

3Q

4Q

FY13 1Q

2Q

3Q

4Q

FY14 1Q

2Q

3Q

4Q

Automobile Business =Operating Income

200

20%

=Operating Margin

154.2 8.2% 6.3%

5.3%

100

4.2%

2.1%

1.4% 0.9%

10%

3.6%

5.0%

4.4%

3.7%

6.5%

-1.2%

-1.4%

45.1 100.6 2.4%

-2.4%

3.6% 80.1

77.2

-2.2%

3.1%

72.9

0%

37.1 13.7

110.4

24.0

148.9

86.3

-6.5%

68.4

-29.1

0 -21.3

-39.1

-16.9

70.9

96.3

-76.2

-10%

-100

-20% F Y10 1Q

2Q

3Q

4Q

F Y11 1Q

2Q

3Q

4Q

F Y12 1Q

2Q

3Q

4Q

FY13 1Q

2Q

3Q

4Q

F Y14 1Q

2Q

3Q

4Q

35

Operations by Business Segment 20

Power Product & Other Businesses

Yen (billions)

=Operating Income

10%

=Operating Margin 5% 0.7%

0.4% -0.5%

0

-4.0% -3.7% -5.9

-4.6

-2.9

-0.4

-0.3

-3.1

-6.4%

0%

1.7%-1.1% 0.1%

-0.2%

-0.4% -2.0 -2.8%

-2.3 -2.8% 0.2

-0.1 -2.1 -3.2%

-2.0 -2.7%

0.1

-2.2

0.5

1.3

0.1

0.1% -0.8

-3.7%

-5%

-2.8

-3.3%

-8.1%

-7.4

-10% -8.9%

-20

-15% FY10 1Q

80

2Q

Yen (billions)

3Q

4Q

FY11 1Q

2Q

3Q

4Q

FY12 1Q

3Q

4Q

FY13 1Q

2Q

3Q

4Q

FY14 1Q

2Q

3Q

4Q

*Honda Trading related out-of-period adjustment is not included

Financial Services Business

38.7%

35.8%

40% 33.2%

32.9%

34.8% 32.0%

60

2Q

29.4%

30.5%

29.5%

32.0% 28.8%

28.7% 27.6%

29.8%

27.0%

30%

26.6% 26.4% 24.0%

27.4%

25.6%

40

20%

20

10%

46.8

0

47.1

53.6

47.2

54.6

47.4

44.6

39.6

53.6

42.8

37.5

35.9

40.8

4Q

FY13 1Q

38.2

38.1

40.9

44.6

46.5

42.7

48.8 0%

FY10 1Q

2Q

3Q

4Q

FY11 1Q

2Q

3Q

4Q

FY12 1Q

2Q

3Q

2Q

3Q

4Q

FY14 1Q

2Q

3Q

4Q

36

Operations by Region =Operating Income

North America

Yen (billions)

=Operating Margin 14%

150 9.7%

10.8%

7.4% 8.9%

7.0%

100

6.0% 7.6%

5.3%

5.7% 6.8% 2.5%

50

10%

8.2%

6.8% 4.8%

2.5%

2.5%

3.0%

3.1%

2.2%

2%

0.7% 7.1

6%

47.6

110.7

70.7

110.7

75.8

89.6

24.5

18.5

47.7

74.8

82.2

0

26.7

70.8

29.0

71.8

46.0

131.1

41.8

-2%

82.2

-6% -50 -10% -100 -14%

-150

-18% FY 10 1Q

2Q

3Q

4Q

FY 11 1Q

2Q

3Q

4Q

FY 12 1Q

2Q

3Q

4Q

FY 13 1Q

2Q

Japan

Yen (billions)

4Q

FY 14 1Q

2Q

3Q

4Q

=Operating Income =Operating Margin

100

1.2% -0.6% -3.2% 10.0 -4.6

-1.0%

53.2

4.5% 4.4% 2.2%1.7% 14.6 20.2

1.2%

-2.4%

-25.7

60.9

-45.8 -21.8

4.9%

5.4% 3.9%

49.2

59.3

46.6

62.1

43.2

40.7

0%

12.5 -35.3 -41.2 -4.4% -4.8%

-7.3%

-50

6%

3.2% 30.0

-8.7

12%

6.4%

6.1%

5.8%

50

0

3Q

-6%

-100

-12%

-150

-18%

-200

-24% FY 10 1Q

2Q

3Q

4Q

FY 11 1Q

2Q

3Q

4Q

FY 12 1Q

2Q

3Q

4Q

FY 13 1Q

2Q

3Q

4Q

FY 14 1Q

2Q

3Q

4Q

37

Operations by Region Europe

Yen (billions)

=Operating Income 9.9%

25

=Operating Margin

10%

6.1%

15

5% 2.1% 20.4 14.9

1.1%

5

0.8%

0.9%

1.8

-1.9% 1.7

4.0

1.8 -6.8

-5

-1.7

-3.8%

-3.8 -2.8%

-0.9%

-3.0

-7.6

0%

-3.5

-6.1

-3.7%

-13.5

-2.5%

-4.0 -4.0%

-3.2%

-9.4

-7.6

-4.8%

-9.7

-6.0% -8.7

-5%

-5.5% -7.7%

-8.7

-5.2% -6.3%

-15

-10% FY 10 1Q

2Q

3Q

4Q

FY 11 1Q

2Q

3Q

4Q

FY 12 1Q

2Q

3Q

4Q

FY 13 1Q

2Q

3Q

4Q

FY 14 1Q

Asia excluding Japan

Yen (billions)

2Q

3Q

4Q

=Operating Income =Operating Margin

10%

9.4%

70

8.8%

8.6% 8.0%

60

8.5%

7.4%

6.7%

6.7%

50

7.0%

6.3%

7.4%

7.6%

7.2%

8%

6.9%

6.2%

6.8% 5.4%

6% 5.7%

40 4.2% 4.2%

30

4%

20 2% 10 20.3

27.5

35.0

30.0

2Q

3Q

4Q

44.4

38.3

35.7

32.1

2Q

3Q

4Q

25.1

33.4

FY 12 1Q

2Q

13.3

16.5

31.7

4Q

FY 13 1Q

36.4

40.5

38.0

2Q

3Q

4Q

53.7

60.0

50.0

54.0

2Q

3Q

4Q

0

0% FY 10 1Q

FY 11 1Q

3Q

FY 14 1Q

38

Operations by Region

=Operating Income

Other Regions

Yen (billions)

=Operating Margin

15%

70 12%

60 9.4%

50

8.6%

8.4%

40

9%

6.8%

7.5% 7.2%

6.6%

6.6%

6.1%

5.6%

5.0%

30

4.6%

4.6%

4.4%

5.0%

6%

3.2%

20

2.6%

2.2%

3%

1.2%

10

-0.3% 9.9

0

17.4

18.9

20.2

20.4

15.6

13.1

15.7

23.0

12.5

5.6

10.5

2.6

10.2

5.4

18.6

7.9

12.9

2Q

3Q

4Q

FY14 1Q

2Q

3Q

4Q

0%

12.2

-0.4

-10

-3% FY10 1Q

2Q

3Q

4Q

FY11 1Q

2Q

3Q

4Q

FY12 1Q

2Q

3Q

4Q

FY13 1Q

39

FY15 Financial Forecasts (Consolidated) Yen (billion)

Change

FY14

FY15

Results

Forecasts

Amount

%

11,842.4

12,750.0

+ 907.5

+ 7.7%

750.2

760.0

+ 9.7

+ 1.3%

6.3%

6.0%

-

-

Income before Income taxes

728.9

745.0

+ 16.0

+ 2.2%

Equity in income of affiliates

132.4

155.0

+ 22.5

+ 17.0%

574.1

595.0

+ 20.8

+ 3.6%

Net Sales Operating Income Operating Margin

Net Income

*1 *2

EPS (Yen)

330.14

318.54

+ 11.60

Average Rates (Yen) US Dollar

100

100

-

Euro

136

135

Yen up by 1 yen

*1 Net income attributable to Honda Motor Co., Ltd. *2 Basic net income attributable to Honda Motor Co., Ltd. Basic net income attributable to Honda Motor Co., Ltd., is calculated based on weighted average number of shares outstanding as shown below: - Fiscal Year Results FY13: 1,802,298,000 (approx), FY14: 1,802,294,000 (approx) - 4th Quarter Results FY13: 1,802,298,000 (approx), FY14: 1,802,291,000 (approx) - Fiscal Year Forecast FY15: 1,802,291,000 (approx)

40

Guidance: Units Sales by Business Segment Motorcycles

Power Products

Automobiles

Unit (Thousand)

Forecast: Honda Group Unit Sales FY14

FY15

Results

Forecasts

Japan

226

230

North America Europe

276

300

166

175

Asia

14,536

15,765

Other Region Total

1,817 17,021

Change

+4 + 24

FY14

FY15

Results

Forecasts

818

990

1,757

1,810

Change

+ 172 + 53

169

170

1,286

1,590

1,770

+9 + 1,229 - 47

293

270

+1 + 304 - 23

18,240

+ 1,219

4,323

4,830

+ 507

FY14

FY15

Results

Forecasts

Change

314

305

2,718

2,845

1,032

1,030

1,500

1,655

472

510

-2 + 155 + 38

6,036

6,345

+ 309

-9 + 127

Forecast: Consolidated Unit Sales FY14

FY15

Results

Forecasts

Japan

226

230

North America Europe

276

300

166

175

Asia

7,858

8,555

Other Region Total

1,817 10,343

Change

FY14

FY15

Results

Forecasts

812

980

1,757

1,810

169

170

529

640

1,770

+9 + 697 - 47

293

11,030

+ 687

3,560

+4 + 24

Change

FY14

FY15

Results

Forecasts

Change

314

305

2,718

2,845

1,032

1,030

1,500

1,655

270

+1 + 111 - 23

472

510

-2 + 155 + 38

3,870

+ 310

6,036

6,345

+ 309

+ 168 + 53

-9 + 127

41

Forecast: Change in Income before Income Taxes Income before Income taxes

Operating Income

+ 50.0 Cost Reduction, etc.

728.9 Revenue, model mix, etc.

Other Income & Expenses

+ 9.7 （ + 1.3 % ）

+ 6.3

- 87.0

+ 125.7

- 12.0 increase in SG&A

Yen (billion)

+ 16.0 ( + 2.2 %)

Increase in R&D

- 67.0 - 43.0 Currency Effects

Unrealized gains and losses related to derivative instruments

+ 49.3

745.0

Other

Operating Income

Operating Income

750.2

760.0

FY14

FY15 Forecast

42

Forecast: Capital Expenditures, Depreciation, R&D Expenses

Yen (billion)

*

FY14

FY15

Results

Forecasts

Change

Capital expenditures *

726.1

650.0

- 76.1

Depreciation and amortization *

375.8

415.0

+ 39.2

R&D expenses

634.1

645.0

+ 10.9

Capital expenditures and Depreciation and amortization in results and forecast aforementioned exclude investment in operating leases, capital leases and intangible assets

43

Dividend (Yen)

FY14

Increase / Increase / FY15 Decrease from ( Expectation ) Decrease from FY13 FY14

Dividend per Share

FY13

1st Quarter End

19

20

+1

( 22 )

(+2)

2nd Quarter End

19

20

+1

( 22 )

(+2)

3rd Quarter End

19

20

+1

( 22 )

(+2)

4th Quarter End

19

( 22 )

(+3)

( 22 )

(+0)

Fiscal Year

76

( 82 )

(+6)

( 88 )

(+6)

Results (Projection)

44

Caution with Respect to Forward-Looking Statements: This slide contains forward-looking statements about the performance of Honda, which are based on management’s assumptions and beliefs taking into account information currently available to it. Therefore, please be advised that Honda’s actual results could differ materially from those described in these forward-looking statements as a result of numerous factors, including general economic conditions in Honda’s principal markets and foreign exchange rates between the Japanese yen and the U.S. dollar, the Euro and other major currencies, as well as other factors detailed from time to time.

Accounting standards: Our consolidated financial standards are prepared in conformity with U.S. generally accepted accounting principles.

Notice on the Factors for Increases and Decreases in Income: With respect to the discussion above of the change in operating income, management has identified the factors set forth below and used what it believes to be a reasonable method to analyze the respective changes in such factors. Each of these factors is explained below. Management has analyzed changes in these factors at the levels of the Company and its material consolidated subsidiaries. (1)“Foreign currency effects” consist of translation adjustments, which come from the translation of the currency of foreign subsidiaries’ financial statements into Japanese Yen, and foreign currency adjustments, which result from foreign-currency-denominated sales, which, at the levels of the Company and those consolidated subsidiaries which have been analyzed, primarily relate to the following currencies: U.S. dollar, Canada dollar, Euro, GBP, BRL and Japanese Yen. (2) With respect to “cost reduction and effects of raw material cost fluctuations”, management has analyzed cost reduction and effects of raw material cost fluctuations at the levels of the Company and its material foreign manufacturing subsidiaries in North America, Europe and other regions. (3) With respect to “changes in net sales and model mix”, management has analyzed changes in sales volume and in the mix of product models sold in major markets which have resulted in increases/decreases in profit, as well as certain other reasons for increases/decreases in net sales and cost of sales. (4) With respect to “selling, general and administrative expenses”, management has analyzed reasons for an increase/decrease in selling, general and administrative expenses from the previous fiscal year net of currency translation effects. 45

45