TOKYO: Honda Motor CEO Toshihiro Mibe secured support for his reappointment to the Japanese automaker’s board at its annual meeting yesterday after apologising to shareholders for the company’s poor financial performance.
Honda is seeking to recover from costly strategic missteps after posting its first annual loss in seven decades last month, hurt by more than US$9 billion (RM37 billion) in restructuring costs for its electric-vehicle (EV) business and competition from Chinese rivals.
“I would like to express my deepest apologies to our shareholders for the significant concern and inconvenience caused by the net loss recorded in the previous fiscal year’s financial results,“ Mibe told shareholders at the start of the meeting.
Aside from backing Mibe, Honda shareholders approved the company’s 10 other board nominees, including nine who were up for reappointment and one new director. The vote was in line with advice from proxy advisers Glass Lewis and ISS, which had recommended supporting all directors.
Amid an EV subsidy rollback, Honda decided on its EV-linked writedown with market share of battery-powered cars in the US sharply below the company’s forecasts, meaning sales of its planned models would have required big incentives, Mibe said.
If it would have gone ahead with selling its planned EVs, “it would mean the automotive business itself staying in the red for at least five years, possibly as long as seven,“ Mibe said, adding that it would have created an extremely critical situation at the company.
In recent months, Mibe has drawn scorn from retired Honda executives over the mishaps, with former CEO Nobuhiko Kawamoto visiting Tokyo headquarters in April to urge him to resign, people familiar with the matter have told Reuters.
