Honda has reported a 40 per cent drop in third-quarter profits after overseas sales were hit by the strong yen.
The auto manufacturer said its profit was 81.1bn yen (£623m), down from 134.6bn yen the year before.
Government incentives to encourage more people to buy environmentally friendly cars have also be sidelined, which ha shit sales.
However, Honda raised its full-year net profit forecast to 530bn yen.
Honda also said the growing sales in emerging markets during the third quarter helped it to offset the loss of revenue from more mature markets.