{"url_path":"/sec/hmc/10-k/2026/item-19","section_key":"item-19","section_title":"Item 19 Exhibits","topic":"sec","document":{"doc_type":"20-F","doc_date":"2026-06-18","source_url":"https://www.sec.gov/Archives/edgar/data/715153/0001193125-26-274991-index.html","accession_number":"0001193125-26-274991","cik":"0000715153","ticker":"HMC","issuer_name":"HONDA MOTOR CO LTD","edgar_url":"https://www.sec.gov/Archives/edgar/data/715153/0001193125-26-274991-index.html","primary_entity_key":"0000715153","primary_entity_name":"HONDA MOTOR CO LTD"},"word_count":34321,"has_tables":true,"body_markdown":"Item 19. Exhibits\n\n \n\n \n\n  1.1  \n\n \n\n  \n\nArticles of Incorporation of the registrant (English translation) *1\n\n \n\n  1.2  \n\n \n\n  \n\nShare Handling Regulations of the registrant (English translation) *2\n\n \n\n  1.3  \n\n \n\n  \n\nRegulations of the Board of Directors of the registrant (English translation) *3\n\n \n\n  1.4  \n\n \n\n  \n\nHonda Motor Co., Ltd. Criteria for Independence of Outside Directors (English translation) *4\n\n \n\n  2.1  \n\n \n\n  \n\nSpecimen common stock certificates of the registrant (English translation) *5\n\n \n\n  2.2  \n\n \n\n  \n\nForm of Second Amended and Restated Deposit Agreement dated as of March 2022, among the registrant, JPMorgan Chase Bank, N.A., as Depositary, and holders and beneficial owners of American Depositary Receipts *6\n\n \n\n  2.3  \n\n \n\n  \n\nForm of Amendment No. 1 to Second Amended and Restated Deposit Agreement, dated September 29, 2023, among the registrant, JPMorgan Chase Bank, N.A., as Depositary and holders and beneficial owners of American Depositary Receipts *7\n\n \n\n  2.4  \n\n \n\n  \n\nDescription of rights of each class of securities registered under Section 12 of the Securities Exchange Act of 1934 *8\n\n \n\n  8.1  \n\n \n\n  \n\nList of Significant Subsidiaries (See “Organizational Structure” in Item 4.C of this Form\n20-F)\n\n \n\n 11.1  \n\n \n\n  \n\nCode of Ethics *9\n\n \n\n 11.2  \n\n \n\n  \n\nGuidelines on Insider Information Control and Insider Trading Regulation (English translation) *10\n\n \n\n 12.1  \n\n \n\n  \n\nCertification of the principal executive officer required by 17 C.F.R. 240.\n13a-14(a)\n\n \n\n 12.2  \n\n \n\n  \n\nCertification of the principal financial officer required by 17 C.F.R. 240.\n13a-14(a)\n\n \n\n 13.1  \n\n \n\n  \n\nCertification of the chief executive officer required by 18 U.S.C. Section 1350\n\n \n\n 13.2  \n\n \n\n  \n\nCertification of the chief financial officer required by 18 U.S.C. Section 1350\n\n \n\n 15.1  \n\n \n\n  \n\nConsent of Independent Registered Public Accounting Firm\n\n \n\n 97.1  \n\n \n\n  \n\nPolicy to Recover Erroneously Awarded Incentive-based Compensation (English translation) *11\n\n \n\n101.INS\n\n \n\n  \n\nInline XBRL Instance Document—the instance document does not appear in the Interactive Data File as its XBRL tags are embedded within the Inline XBRL document\n\n \n\n101.SCH\n\n \n\n  \n\nInline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents\n\n \n\n104\n\n \n\n  \n\nCover page formatted as Inline XBRL and contained in Exhibit 101\n\n \n\n*1\n\nIncorporated by reference to the registrant’s Annual Report on Form\n20-F\nfiled on June 23, 2021.\n\n*2\n\nIncorporated by reference to the registrant’s Annual Report on Form\n20-F\nfiled on June 23, 2023.\n\n*3\n\nIncorporated by reference to the registrant’s Annual Report on Form 20-F filed on June 18, 2025.\n\n*4\n\nIncorporated by reference to the registrant’s Annual Report on Form\n20-F\nfiled on June 23, 2021.\n\n*5\n\nIncorporated by reference to the registrant’s Annual Report on Form\n20-F\nfiled on September 27, 2001. (P)\n\n*6\n\nIncorporated by reference to the registration statement for American Depositary Shares on Form\nF-6\n(File\nNo. 333-263937)\nfiled by JPMorgan Chase Bank, N.A. as depositary, on March 29, 2022.\n\n*7\n\nIncorporated by reference to Post-Effective Amendment No. 1 to the registration statement for American Depositary Shares on Form\nF-6\n(File\nNo. 333-263937)\nfiled by JPMorgan Chase Bank, N.A. as depositary, on September 21, 2023.\n\n*8\n\nIncorporated by reference to the registrant’s Annual Report on Form 20-F filed on June 18, 2025.\n\n*9\n\nIncorporated by reference to the registrant’s Annual Report on Form\n20-F\nfiled on July 9, 2004.\n\n*10\n\nIncorporated by reference to the registrant’s Annual Report on Form\n20-F\nfiled on June 20, 2024.\n\n*11\n\nIncorporated by reference to the registrant’s Annual Report on Form\n20-F\nfiled on June 20, 2024.\n\nThe Company has not included as exhibits certain instruments with respect to its long-term debt, the amount of debt authorized under each of which does not exceed 10% of its total assets, and it agrees to furnish a copy of any such instrument to the Securities and Exchange Commission upon request.\n\n(P) Paper exhibits\n\n \n\n151\n\n##### Table of Contents\n\nFinance income and finance costs (Interest expense / Other, net) Other financial assets (Current /Non-current)\n\nHONDA MOTOR CO., LTD.\n\n(Honda Giken Kogyo Kabushiki Kaisha)\n\n(A Japanese Company)\n\nAND SUBSIDIARIES\n\nConsolidated Financial Statements\n\nand\n\nReports of Independent Registered\n\nPublic Accounting Firm\n\nMarch 31, 2026\n\n \n\nTo be Included in\n\nThe Annual Report\n\nForm\n20-F\n\nFiled with\n\nThe Securities and Exchange Commission\n\nWashington, D.C., U.S.A.\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nIndex to Consolidated Financial Statements\n\n \n\n[Reports of Independent Registered Public Accounting Firm](#fin116494_1)\n\n  \n \n\nF-3\n\n \n\n[Consolidated Statements of Financial Position – March 31, 2025 and 2026](#fin116494_2)\n\n  \n \n\nF-8\n\n \n\n[Consolidated Statements of Income – Years ended March 31, 2024, 2025 and 2026](#fin116494_3)\n\n  \n \n\nF-9\n\n \n\n[Consolidated Statements of Comprehensive Income – Years ended March 31, 2024, 2025 and 2026](#fin116494_4)\n\n  \n \n\nF-10\n\n \n\n[Consolidated Statements of Changes in Equity – Years ended March 31, 2024, 2025 and 2026](#fin116494_5)\n\n  \n \n\nF-11\n\n \n\n[Consolidated Statements of Cash Flows – Years ended March 31, 2024, 2025 and 2026](#fin116494_6)\n\n  \n \n\nF-12\n\n \n\n[Notes to Consolidated Financial Statements](#fin116494_7)\n\n  \n \n\nF-13\n\n \n\nFinancial statements of affiliates and joint ventures are omitted because such affiliates and joint ventures are not individually significant.\n\n \n\nF-2\n\n[Table of Contents](#toc)\n\nReport of Independent Registered Public Accounting Firm\n\nTo the Stockholders and Board of Directors\n\nHonda Motor Co., Ltd.:\n\nOpinion on the Consolidated Financial Statements\n\nWe have audited the accompanying consolidated statements of financial position of Honda Motor Co., Ltd. and subsidiaries (the “Company”) as of March 31, 2026 and 2025, the related consolidated statements of income, comprehensive income, changes in equity, and cash flows for each of the years in the three-year period ended March 31, 2026, and the related notes (collectively, the “consolidated financial statements”). In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company as of March 31, 2026 and 2025, and the results of its operations and its cash flows for each of the years in the three-year period ended March 31, 2026, in conformity with International Financial Reporting Standards as issued by the International Accounting Standards Board.\n\nWe also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the Company’s internal control over financial reporting as of March 31, 2026, based on criteria established in\n\nInternal Control – Integrated Framework (2013)\n\n issued by the Committee of Sponsoring Organizations of the Treadway Commission, and our report dated June 18, 2026 expressed an unqualified opinion on the effectiveness of the Company’s internal control over financial reporting.\n\nBasis for Opinion\n\nThese consolidated financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these consolidated financial statements based on our audits. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\n\nWe conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the consolidated financial statements are free of material misstatement, whether due to error or fraud. Our audits included performing procedures to assess the risks of material misstatement of the consolidated financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the consolidated financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the consolidated financial statements. We believe that our audits provide a reasonable basis for our opinion.\n\nCritical Audit Matters\n\nThe critical audit matters communicated below are matters arising from the current period audit of the consolidated financial statements that were communicated or required to be communicated to the audit committee and that: (1) relate to accounts or disclosures that are material to the consolidated financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the consolidated financial statements, taken as a whole, and we are not, by communicating the critical audit matters below, providing separate opinions on the critical audit matters or on the accounts or disclosures to which they relate.\n\n \n\nF-3\n\n[Table of Contents](#toc)\n\nEvaluation of the provisions for specific warranty programs\n\nAs discussed in Note 17 to the consolidated financial statements, the Company’s provisions for product warranties as of March 31, 2026 amounted to ¥867,168 million, which included the provisions for specific warranty programs such as product recalls. The provisions for specific warranty programs of automobile products manufactured at major production bases are accrued comprehensively at the time products are sold to customers and are measured by number of units sold over the past fiscal years and expected specific warranty cost per unit to be incurred after vehicle sales over their product life. In addition to the provisions comprehensively accrued, certain warranty program cost is individually accrued when it is deemed appropriate by considering its nature and magnitude of each program.\n\nWe identified the evaluation of the provisions for specific warranty programs as a critical audit matter, as a high degree of audit effort and subjective and complex auditor judgment was required to evaluate the expected specific warranty cost per unit. In addition, auditor judgment was required to evaluate the sufficiency of audit evidence obtained.\n\nThe following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s process of the provisions for specific warranty programs. This included controls related to the determination of the expected specific warranty cost per unit to develop the provisions comprehensively accrued for specific warranty programs. We evaluated the expected specific warranty cost per unit by comparing it to historical trends of warranty costs and testing the reliability of data used to determine the expected specific warranty cost per unit.\n\nWe also assessed the sufficiency of the audit evidence obtained by evaluating the:\n\n \n\n \n\n•\n\n \n\ncumulative results of the audit procedures,\n\n \n\n \n\n•\n\n \n\nqualitative aspects of the Company’s accounting practices, and\n\n \n\n \n\n•\n\n \n\npotential bias in the accounting estimates.\n\nAllowance for expected credit losses on retail receivables at the finance subsidiary in the United States\n\nAs discussed in Note 7 to the consolidated financial statements, the Company’s allowance for expected credit losses (ECL) related to receivables from financial services was ¥108,374 million as of March 31, 2026, which included the allowance for ECL on retail receivables which amounted\nto\n¥104,378 million. The allowance for ECL on retail receivables is measured at amounts according to the ECL methodology, including the determination on whether credit risk increased significantly since initial recognition. ECL is a probability-weighted estimate of the difference between the contractual cash flows and the cash flows that the Company expects to receive, which can be affected by forward-looking economic conditions. At the finance subsidiary in the United States, ECL on retail receivables is determined for groups of financial assets based on relevant risk characteristics including borrower, collateral and macroeconomic risk characteristics.\n\nWe identified the assessment of the allowance for ECL on retail receivables at the finance subsidiary in the United States as a critical audit matter. A high degree of audit effort, including specialized skills and knowledge, and subjective and complex auditor judgment was involved in the assessment due to measurement uncertainty. Specifically, the assessment encompassed the evaluation of the ECL methodology, including (1) the methods and models used to derive the allowance for ECL and significant increases in credit risk since initial recognition and (2) the selection of the forward-looking economic conditions and the probability weightings. In addition, auditor judgment was required to evaluate the sufficiency of audit evidence obtained.\n\n \n\nF-4\n\n[Table of Contents](#toc)\n\nThe following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls related to the allowance for ECL estimate, including controls related to:\n\n \n\n \n\n•\n\n \n\ncontinued use and appropriateness of the ECL methodology and models, including the determination of significant increases in credit risk since initial recognition and the selection of the forward-looking economic conditions and the probability weightings,\n\n \n\n \n\n•\n\n \n\nanalysis of model results as compared to actual loss performance, and\n\n \n\n \n\n•\n\n \n\nre-evaluation\nof the model used to estimate expected credit losses.\n\nWe evaluated the Company’s process to develop the allowance for ECL by testing certain sources of data, factors, and assumptions that the Company used, and considered the relevance and reliability of such data, factors, and assumptions. In addition, we involved credit risk professionals with specialized skills and knowledge, who assisted in:\n\n \n\n \n\n•\n\n \n\nevaluating the Company’s ECL methodology for compliance with International Financial Reporting Standards as issued by the International Accounting Standards Board,\n\n \n\n \n\n•\n\n \n\nassessing the conceptual soundness and performance testing of the model by inspecting model documentation to determine whether the model is consistent with the model methodology and is suitable for their intended use,\n\n \n\n \n\n•\n\n \n\nevaluating the Company’s method to measure significant increases in credit risk since initial recognition by performing a sensitivity analysis over the significant increase in credit risk threshold,\n\n \n\n \n\n•\n\n \n\nevaluating model back-testing results to assess model output is consistent with actual loss performance,\n\n \n\n \n\n•\n\n \n\nevaluating model recalibration/adjustment decision making processes, including back-testing results and impact to the ECL,\n\n \n\n \n\n•\n\n \n\nassessing the selection of the forward-looking economic conditions and the probability weightings by comparing them to the Company’s business environment and relevant industry practices, and\n\n \n\n \n\n•\n\n \n\nassessing the reasonableness and appropriateness of the Company’s qualitative framework over its retail allowance modelling.\n\nWe also assessed the sufficiency of the audit evidence obtained by evaluating the:\n\n \n\n \n\n•\n\n \n\ncumulative results of the audit procedures,\n\n \n\n \n\n•\n\n \n\nqualitative aspects of the Company’s accounting practices, and\n\n \n\n \n\n•\n\n \n\npotential bias in the accounting estimates.\n\nEstimated end of term residual values of lease vehicles at the finance subsidiary in the United States\n\nAs discussed in Note 3(f) to the consolidated financial statements, depreciation of equipment on operating leases is calculated on the straight-line method over the lease term. The Company’s equipment on operating leases as of March 31, 2026 was ¥6,433,793 million, which included leased vehicles at the finance subsidiary in the United States. Equipment on operating leases is depreciated to the lower of contract residual values or estimated end of term residual values. Adjustments to estimated end of term residual values are made prospectively on a straight-line basis over the remaining term of the lease and are recognized as depreciation expense. At the finance subsidiary in the United States, the primary factors that affect estimated end of term residual values of leased vehicles are the percentage of leased vehicles expected to be returned by the lessees and the expected market values of leased vehicles at the end of their lease terms. Factors considered in this evaluation include, among other factors, economic conditions, external market information on new and used vehicles, historical trends, and recent auction values.\n\n \n\nF-5\n\n[Table of Contents](#toc)\n\nWe identified the assessment of estimated end of term residual values of leased vehicles at the finance subsidiary in the United States as a critical audit matter. A high degree of audit effort, including specialized skills and knowledge, and subjective and complex auditor judgment was involved in the assessment due to measurement uncertainty. Specifically, complex auditor judgment was required to assess the residual value methodology, the model used to estimate the percentage of leased vehicles expected to be returned by the lessee at the end of the lease term and the expected market values of leased vehicles at the end of the lease term. In addition, auditor judgment was required to evaluate the sufficiency of audit evidence obtained.\n\nThe following are the primary procedures we performed to address this critical audit matter. We evaluated the design and tested the operating effectiveness of certain internal controls related to the Company’s measurement of the end of term residual values of lease vehicles estimate, including controls related to the:\n\n \n\n \n\n•\n\n \n\ncontinued use and appropriateness of the residual value methodology and model used to estimate the residual values of leased vehicles at the end of the lease term,\n\n \n\n \n\n•\n\n \n\nevaluation of the percentage of lease vehicles expected to be returned by the lessees as compared to actual vehicles returned, and\n\n \n\n \n\n•\n\n \n\nanalysis of the actual gain or loss recorded on the disposition of lease vehicles.\n\nWe evaluated the Company’s process to develop the estimated end of term residual values of lease vehicles by testing certain sources of data, factors, and assumptions that the Company used, and considered the relevance and reliability of such data, factors, and assumptions. In addition, we involved valuation professionals with specialized skills and knowledge, who assisted in:\n\n \n\n \n\n•\n\n \n\nevaluating the Company’s residual value methodology for compliance with International Financial Reporting Standards as issued by the International Accounting Standards Board,\n\n \n\n \n\n•\n\n \n\nassessing the conceptual soundness and performance testing of the model by inspecting model documentation to determine whether the model is consistent with the model methodology and is suitable for their intended use, and\n\n \n\n \n\n•\n\n \n\nevaluating the Company’s expected market values of leased vehicles at the end of the lease term assumption by comparing it to specific portfolio risk characteristics and trends.\n\nWe also assessed the sufficiency of the audit evidence obtained by evaluating the:\n\n \n\n \n\n•\n\n \n\ncumulative results of the audit procedures,\n\n \n\n \n\n•\n\n \n\nqualitative aspects of the Company’s accounting practices, and\n\n \n\n \n\n•\n\n \n\npotential bias in the accounting estimates.\n\n/s/ KPMG AZSA LLC\n\nWe have served as the Company’s auditor since 1962.\n\nTokyo, Japan\n\nJune 18, 202\n6\n\n \n\nF-6\n\n[Table of Contents](#toc)\n\nReport of Independent Registered Public Accounting Firm\n\nTo the Stockholders and Board of Directors\n\nHonda Motor Co., Ltd.:\n\nOpinion on Internal Control Over Financial Reporting\n\nWe have audited Honda Motor Co., Ltd. and subsidiaries’ (the “Company”) internal control over financial reporting as of March 31, 2026, based on criteria established in\n\nInternal Control – Integrated Framework (2013)\n\n issued by the Committee of Sponsoring Organizations of the Treadway Commission. In our opinion, the Company maintained, in all material respects, effective internal control over financial reporting as of March 31, 2026, based on criteria established in\n\nInternal Control – Integrated Framework (2013)\n\n issued by the Committee of Sponsoring Organizations of the Treadway Commission.\n\nWe also have audited, in accordance with the standards of the Public Company Accounting Oversight Board (United States) (PCAOB), the consolidated statements of financial position of the Company as of March 31, 2026 and 2025, the related consolidated statements of income, comprehensive income, changes in equity, and cash flows for each of the years in the three-year period ended March 31, 2026, and the related notes (collectively, the consolidated financial statements), and our report dated June 18, 2026 expressed an unqualified opinion on those consolidated financial statements.\n\nBasis for Opinion\n\nThe Company’s management is responsible for maintaining effective internal control over financial reporting and for its assessment of the effectiveness of internal control over financial reporting, included in the accompanying Management’s Report on Internal Control over Financial Reporting. Our responsibility is to express an opinion on the Company’s internal control over financial reporting based on our audit. We are a public accounting firm registered with the PCAOB and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.\n\nWe conducted our audit in accordance with the standards of the PCAOB. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether effective internal control over financial reporting was maintained in all material respects. Our audit of internal control over financial reporting included obtaining an understanding of internal control over financial reporting, assessing the risk that a material weakness exists, and testing and evaluating the design and operating effectiveness of internal control based on the assessed risk. Our audit also included performing such other procedures as we considered necessary in the circumstances. We believe that our audit provides a reasonable basis for our opinion.\n\nDefinition and Limitations of Internal Control Over Financial Reporting\n\nA company’s internal control over financial reporting is a process designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. A company’s internal control over financial reporting includes those policies and procedures that (1) pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of the company; (2) provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that receipts and expenditures of the company are being made only in accordance with authorizations of management and directors of the company; and (3) provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use, or disposition of the company’s assets that could have a material effect on the financial statements.\n\nBecause of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.\n\n/s/ KPMG AZSA LLC\n\nTokyo, Japan\n\nJune 18, 2026\n\n \n\nF-7\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nConsolidated Statements of Financial Position\n\nMarch 31, 2025 and 2026\n\n \n\n \n\n  \n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\nNote\n\n \n\n  \n\n2025\n\n \n\n \n\n2026\n\n \n\nAssets\n\n  \n\n  \n\n \n\nCurrent assets:\n\n  \n\n  \n\n \n\nCash and cash equivalents\n\n  \n \n5\n \n  \n¥\n4,528,795\n \n \n¥\n5,066,828\n \n\nTrade receivables\n\n  \n \n6\n \n  \n \n1,160,847\n \n \n \n1,270,476\n \n\nReceivables from financial services\n\n  \n \n7\n \n  \n \n2,755,800\n \n \n \n3,057,235\n \n\nOther financial assets\n\n  \n \n8\n \n  \n \n208,478\n \n \n \n296,974\n \n\nInventories\n\n  \n \n9\n \n  \n \n2,470,590\n \n \n \n2,531,166\n \n\nOther current assets\n\n  \n\n  \n \n563,252\n \n \n \n852,073\n \n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal current assets\n\n  \n\n  \n \n11,687,762\n \n \n \n13,074,752\n \n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNon-current\nassets:\n\n  \n\n  \n\n \n\nInvestments accounted for using the equity method\n\n  \n \n10\n \n  \n \n1,242,614\n \n \n \n1,128,118\n \n\nReceivables from financial services\n\n  \n \n7\n \n  \n \n6,172,817\n \n \n \n6,836,261\n \n\nOther financial assets\n\n  \n \n8\n \n  \n \n873,459\n \n \n \n1,211,519\n \n\nEquipment on operating leases\n\n  \n \n11\n \n  \n \n5,748,187\n \n \n \n6,433,793\n \n\nProperty, plant and equipment\n\n  \n \n12\n \n  \n \n3,209,921\n \n \n \n3,196,382\n \n\nIntangible assets\n\n  \n \n13\n \n  \n \n1,126,019\n \n \n \n784,760\n \n\nDeferred tax assets\n\n  \n \n23\n \n  \n \n143,499\n \n \n \n301,011\n \n\nOther\nnon-current\nassets\n\n  \n\n  \n \n571,589\n \n \n \n542,689\n \n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\nnon-current\nassets\n\n  \n\n  \n \n19,088,105\n \n \n \n20,434,533\n \n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal assets\n\n  \n\n  \n¥\n30,775,867\n \n \n¥\n33,509,285\n \n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nLiabilities and Equity\n\n  \n\n  \n\n \n\nCurrent liabilities:\n\n  \n\n  \n\n \n\nTrade payables\n\n  \n \n14\n \n  \n¥\n1,663,487\n \n \n¥\n1,781,598\n \n\nFinancing liabilities\n\n  \n \n15\n \n  \n \n4,497,747\n \n \n \n5,004,712\n \n\nAccrued expenses\n\n  \n\n  \n \n728,935\n \n \n \n996,653\n \n\nOther financial liabilities\n\n  \n \n16\n \n  \n \n276,861\n \n \n \n264,598\n \n\nIncome taxes payable\n\n  \n\n  \n \n108,562\n \n \n \n109,036\n \n\nProvisions\n\n  \n \n17\n \n  \n \n388,441\n \n \n \n948,252\n \n\nOther current liabilities\n\n  \n\n  \n \n951,124\n \n \n \n1,099,631\n \n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal current liabilities\n\n  \n\n  \n \n8,615,157\n \n \n \n10,204,480\n \n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNon-current\nliabilities:\n\n  \n\n  \n\n \n\nFinancing liabilities\n\n  \n \n15\n \n  \n \n6,953,520\n \n \n \n8,475,151\n \n\nOther financial liabilities\n\n  \n \n16\n \n  \n \n301,439\n \n \n \n316,498\n \n\nRetirement benefit liabilities\n\n  \n \n18\n \n  \n \n288,472\n \n \n \n309,885\n \n\nProvisions\n\n  \n \n17\n \n  \n \n667,274\n \n \n \n735,224\n \n\nDeferred tax liabilities\n\n  \n \n23\n \n  \n \n718,084\n \n \n \n677,391\n \n\nOther\nnon-current\nliabilities\n\n  \n\n  \n \n604,099\n \n \n \n642,584\n \n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\nnon-current\nliabilities\n\n  \n\n  \n \n9,532,888\n \n \n \n11,156,733\n \n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal liabilities\n\n  \n\n  \n \n18,148,045\n \n \n \n21,361,213\n \n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nEquity:\n\n  \n\n  \n\n \n\nCommon stock\n\n  \n\n  \n \n86,067\n \n \n \n86,067\n \n\nCapital surplus\n\n  \n\n  \n \n205,299\n \n \n \n204,894\n \n\nTreasury stock\n\n  \n\n  \n \n(1,272,845\n) \n \n \n(896,927\n) \n\nRetained earnings\n\n  \n\n  \n \n11,122,187\n \n \n \n9,375,989\n \n\nOther components of equity\n\n  \n\n  \n \n2,185,821\n \n \n \n3,047,489\n \n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nEquity attributable to owners of the parent\n\n  \n\n  \n \n12,326,529\n \n \n \n11,817,512\n \n\nNon-controlling\ninterests\n\n  \n\n  \n \n301,293\n \n \n \n330,560\n \n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal equity\n\n  \n \n19\n \n  \n \n12,627,822\n \n \n \n12,148,072\n \n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal liabilities and equity\n\n  \n\n  \n¥\n30,775,867\n \n \n¥\n33,509,285\n \n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nSee accompanying notes to consolidated financial statements.\n\n \n\nF-8\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nConsolidated Statements of Income\n\nYears ended March 31, 2024, 2025 and 2026\n\n \n\n \n\n  \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\nNote\n\n  \n\n2024\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nSales revenue\n\n  \n20\n  \n¥\n20,428,802\n \n \n¥\n21,688,767\n \n \n¥\n21,796,610\n \n\nOperating costs and expenses:\n\n  \n\n  \n\n \n\n \n\nCost of sales\n\n  \n\n  \n \n(16,016,659\n) \n \n \n(17,024,788\n) \n \n \n(18,193,428\n)\n\nSelling, general and administrative\n\n  \n\n  \n \n(2,106,539\n) \n \n \n(2,351,011\n) \n \n \n(2,476,882\n)\n\nResearch and development\n\n  \n21\n  \n \n(923,627\n) \n \n \n(1,099,482\n) \n \n \n(1,540,646\n)\n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal operating costs and expenses\n\n  \n\n  \n \n(19,046,825\n) \n \n \n(20,475,281\n) \n \n \n(22,210,956\n)\n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nOperating profit (loss)\n\n  \n\n  \n \n1,381,977\n \n \n \n1,213,486\n \n \n \n(414,346\n)\n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nShare of profit (loss) of investments accounted for using\nthe equity method\n\n  \n10\n  \n \n110,817\n \n \n \n982\n \n \n \n(162,080\n) \n\nFinance income and finance costs:\n\n  \n\n  \n\n \n\n \n\nInterest income\n\n  \n22\n  \n \n173,695\n \n \n \n191,131\n \n \n \n179,466\n\nInterest expense\n\n  \n22\n  \n \n(59,631\n) \n \n \n(54,907\n) \n \n \n(83,562\n)\n\nOther, net\n\n  \n22\n  \n \n35,526\n \n \n \n(33,052\n) \n \n \n77,222\n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal finance income and finance costs\n\n  \n\n  \n \n149,590\n \n \n \n103,172\n \n \n \n173,126\n \n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nProfit (loss) before income taxes\n\n  \n\n  \n \n1,642,384\n \n \n \n1,317,640\n \n \n \n(403,300\n)\n\nIncome tax expense\n\n  \n23\n  \n \n(459,794\n) \n \n \n(414,606\n) \n \n \n50,277\n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nProfit (loss) for the year\n\n  \n\n  \n¥\n1,182,590\n \n \n¥\n903,034\n \n \n¥\n(353,023\n)\n\n  \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nProfit\n(loss)\nfor the year attributable to:\n\n  \n\n  \n\n \n\n \n\nOwners of the parent\n\n  \n\n  \n \n1,107,174\n \n \n \n835,837\n \n \n \n(423,941\n)\n\nNon-controlling\ninterests\n\n  \n\n  \n \n75,416\n \n \n \n67,197\n \n \n \n70,918\n\n \n  \n \n  \n\nYen\n\n \n\n \n  \n \n  \n\n2024\n\n \n \n\n2025\n\n \n \n\n2026\n\n \n\nEarnings (loss) per share attributable to owners of the parent\nBasic and diluted\n\n  \n24\n  \n¥\n225.88\n \n \n¥\n178.93\n \n \n¥\n\n(106.06\n\n)\n\nSee accompanying notes to consolidated financial statements.\n\n \n\nF-9\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nConsolidated Statements of Comprehensive Income\n\nYears ended March 31, 2024, 2025 and 2026\n\n \n\n \n\n \n\n \n\n \n\nYen (millions)\n\n \n\n \n\n \n\nNote\n\n \n\n2024\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nProfit (loss) for the year\n\n \n\n \n¥\n1,182,590\n \n \n¥\n903,034\n \n \n¥\n(353,023\n)\n\nOther comprehensive income, net of tax:\n\n \n\n \n\n \n\n \n\nItems that will not be reclassified to profit or loss\n\n \n\n \n\n \n\n \n\nRemeasurements of defined benefit plans\n\n \n\n \n \n(18,931\n) \n \n \n26,727\n \n \n \n(15,046\n) \n\nNet changes in revaluation of financial assets measured at fair value through other comprehensive income\n\n \n\n \n \n(25,469\n) \n \n \n(13,477\n) \n \n \n131,114\n \n\nShare of other comprehensive income of investments accounted for using the equity method\n\n \n10\n \n \n8,300\n \n \n \n(6,499\n) \n \n \n3,480\n \n\nItems that may be reclassified subsequently to profit or loss\n\n \n\n \n\n \n\n \n\nNet changes in revaluation of financial assets measured at fair value through other comprehensive income\n\n \n\n \n \n56\n \n \n \n415\n \n \n \n(71\n)\n\nExchange differences on translating foreign operations\n\n \n\n \n \n875,050\n \n \n \n(162,325\n) \n \n \n701,925\n \n\nCash flow hedges\n\n \n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n11,021\n\n \n\nShare of other comprehensive income of investments accounted for using the equity method\n\n \n10\n \n \n54,353\n \n \n \n18,401\n \n \n \n59,947\n \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal other comprehensive income, net of tax\n\n \n19\n \n \n893,359\n \n \n \n(136,758\n) \n \n \n892,370\n \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nComprehensive income for the year\n\n \n\n \n¥\n2,075,949\n \n \n¥\n766,276\n \n \n¥\n539,347\n \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nComprehensive income for the year attributable to:\n\n \n\n \n\n \n\n \n\nOwners of the parent\n\n \n\n \n \n1,981,448\n \n \n \n699,150\n \n \n \n445,315\n \n\nNon-controlling\ninterests\n\n \n\n \n \n94,501\n \n \n \n67,126\n \n \n \n94,032\n \n\n \n\nSee accompanying notes to consolidated financial statements.\n\n \n\nF-10\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nConsolidated Statements of Changes in Equity\n\nYears ended March 31, 2024, 2025 and 2026\n\n \n\n \n\n \n\n \n\n \n\n \n\nYen (millions)\n\n \n\n \n\n \n\n \n\n \n\n \n\nEquity attributable to owners of the parent\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nNote\n\n \n\n \n\nCommon\nstock\n\n \n\n \n\nCapital\nsurplus\n\n \n\n \n\nTreasury\nstock\n\n \n\n \n\nRetained\nearnings\n\n \n\n \n\nOther\ncomponents\nof equity\n\n \n\n \n\nTotal\n\n \n\n \n\nNon-\ncontrolling\ninterests\n\n \n\n \n\nTotal\nequity\n\n \n\nBalance as of April 1, 2023\n\n \n\n \n¥\n86,067\n \n \n¥\n185,589\n \n \n¥\n(484,931\n) \n \n¥\n9,980,128\n \n \n¥\n1,417,397\n \n \n¥\n11,184,250\n \n \n¥\n318,041\n \n \n¥\n11,502,291\n \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nComprehensive income for the year\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nProfit (loss) for the year\n\n \n\n \n\n \n\n \n\n \n \n1,107,174\n \n \n\n \n \n1,107,174\n \n \n \n75,416\n \n \n \n1,182,590\n \n\nOther comprehensive income, net of tax\n\n \n \n19\n \n \n\n \n\n \n\n \n\n \n \n874,274\n \n \n \n874,274\n \n \n \n19,085\n \n \n \n893,359\n \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal comprehensive income for the year\n\n \n\n \n\n \n\n \n\n \n \n1,107,174\n \n \n \n874,274\n \n \n \n1,981,448\n \n \n \n94,501\n \n \n \n2,075,949\n \n\nReclassification to retained earnings\n\n \n \n19\n \n \n\n \n\n \n\n \n \n(17,715\n) \n \n \n17,715\n \n \n \n— \n \n \n\n \n \n— \n \n\nTransactions with owners and other\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDividends paid\n\n \n \n19\n \n \n\n \n\n \n\n \n \n(241,865\n) \n \n\n \n \n(241,865\n) \n \n \n(63,895\n) \n \n \n(305,760\n) \n\nPurchases of treasury stock\n\n \n\n \n\n \n\n \n \n(250,513\n) \n \n\n \n\n \n \n(250,513\n) \n \n\n \n \n(250,513\n) \n\nDisposal of treasury stock\n\n \n\n \n\n \n\n \n \n504\n \n \n\n \n\n \n \n504\n \n \n\n \n \n504\n \n\nCancellation of treasury stock\n\n \n\n \n\n \n \n(623\n) \n \n \n184,132\n \n \n \n(183,509\n) \n \n\n \n \n— \n \n \n\n \n \n— \n \n\nShare-based payment transactions\n\n \n\n \n\n \n \n3\n \n \n\n \n\n \n\n \n \n3\n \n \n\n \n \n3\n \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nEquity transactions and others\n\n \n\n \n\n \n \n20,104\n \n \n\n \n\n \n \n3,064\n \n \n \n23,168\n \n \n \n(39,770\n) \n \n \n(16,602\n) \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal transactions with owners and other\n\n \n\n \n\n \n \n19,484\n \n \n \n(65,877\n) \n \n \n(425,374\n) \n \n \n3,064\n \n \n \n(468,703\n) \n \n \n(103,665\n) \n \n \n(572,368\n) \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2024\n\n \n\n \n¥\n86,067\n \n \n¥\n205,073\n \n \n¥\n(550,808\n) \n \n¥\n10,644,213\n \n \n¥\n2,312,450\n \n \n¥\n12,696,995\n \n \n¥\n308,877\n \n \n¥\n13,005,872\n \n\nComprehensive income for the year\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nProfit (loss) for the year\n\n \n\n \n\n \n\n \n\n \n \n835,837\n \n \n\n \n \n835,837\n \n \n \n67,197\n \n \n \n903,034\n \n\nOther comprehensive income, net of tax\n\n \n \n19\n \n \n\n \n\n \n\n \n\n \n \n(136,687\n) \n \n \n(136,687\n) \n \n \n(71\n) \n \n \n(136,758\n) \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal comprehensive income for the year\n\n \n\n \n\n \n\n \n\n \n \n835,837\n \n \n \n(136,687\n) \n \n \n699,150\n \n \n \n67,126\n \n \n \n766,276\n \n\nReclassification to retained earnings\n\n \n \n19\n \n \n\n \n\n \n\n \n \n(10,058\n) \n \n \n10,058\n \n \n \n— \n \n \n\n \n \n— \n \n\nTransactions with owners and other\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDividends paid\n\n \n \n19\n \n \n\n \n\n \n\n \n \n(347,805\n) \n \n\n \n \n(347,805\n) \n \n \n(78,692\n) \n \n \n(426,497\n) \n\nPurchases of treasury stock\n\n \n\n \n\n \n\n \n \n(722,365\n) \n \n\n \n\n \n \n(722,365\n) \n \n\n \n \n(722,365\n) \n\nDisposal of treasury stock\n\n \n\n \n\n \n\n \n \n328\n \n \n\n \n\n \n \n328\n \n \n\n \n \n328\n \n\nShare-based payment transactions\n\n \n\n \n\n \n \n226\n \n \n\n \n\n \n\n \n \n226\n \n \n\n \n \n226\n \n\nEquity transactions and others\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n \n3,982\n \n \n \n3,982\n \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal transactions with owners and other\n\n \n\n \n\n \n \n226\n \n \n \n(722,037\n) \n \n \n(347,805\n) \n \n\n \n \n(1,069,616\n) \n \n \n(74,710\n) \n \n \n(1,144,326\n) \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n \n\n \n¥\n86,067\n \n \n¥\n205,299\n \n \n¥\n(1,272,845\n) \n \n¥\n11,122,187\n \n \n¥\n2,185,821\n \n \n¥\n12,326,529\n \n \n¥\n301,293\n \n \n¥\n12,627,822\n \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nComprehensive income for the year\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nProfit (loss) for the year\n\n \n\n \n\n \n\n \n\n \n \n(423,941\n) \n \n\n \n \n(423,941\n) \n \n \n70,918\n \n \n \n(353,023\n) \n\nOther comprehensive income, net of tax\n\n \n \n19\n \n \n\n \n\n \n\n \n\n \n \n869,256\n \n \n \n869,256\n \n \n \n23,114\n \n \n \n892,370\n \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal comprehensive income for the year\n\n \n\n \n\n \n\n \n\n \n \n(423,941\n) \n \n \n869,256\n \n \n \n445,315\n \n \n \n94,032\n \n \n \n539,347\n \n\nReclassification to retained earnings\n\n \n \n19\n \n \n\n \n\n \n\n \n \n7,588\n \n \n \n(7,588\n) \n \n \n— \n \n \n\n \n \n— \n \n\nTransactions with owners and other\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nDividends paid\n\n \n \n19\n \n \n\n \n\n \n\n \n \n(284,390\n) \n \n\n \n \n(284,390\n) \n \n \n(64,765\n) \n \n \n(349,155\n) \n\nPurchases of treasury stock\n\n \n\n \n\n \n\n \n \n(670,933\n) \n \n\n \n\n \n \n(670,933\n) \n \n\n \n \n(670,933\n) \n\nDisposal of treasury stock\n\n \n\n \n\n \n\n \n \n663\n \n \n\n \n\n \n \n663\n \n \n\n \n \n663\n \n\nCancellation of treasury stock\n\n \n\n \n\n \n\n \n \n1,046,188\n \n \n \n(1,046,188\n) \n \n\n \n \n— \n \n \n\n \n \n— \n \n\nShare-based payment transactions\n\n \n\n \n\n \n \n(405\n) \n \n\n \n\n \n\n \n \n\n(405\n\n)  \n\n \n\n \n \n(405\n) \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal transactions with owners and other\n\n \n\n \n\n \n \n(405\n) \n \n \n375,918\n \n \n \n(1,330,578\n) \n \n\n \n \n(955,065\n) \n \n \n(64,765\n) \n \n \n(1,019,830\n) \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nOther changes\n\n \n\n \n\n \n\n \n\n \n \n733\n \n \n\n \n \n733\n \n \n\n \n \n733\n \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n \n\n \n¥\n86,067\n \n \n¥\n204,894\n \n \n¥\n(896,927\n) \n \n¥\n9,375,989\n \n \n¥\n3,047,489\n \n \n¥\n11,817,512\n \n \n¥\n330,560\n \n \n¥\n12,148,072\n \n\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nSee accompanying notes to consolidated financial statements.\n\n \n\nF-11\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nConsolidated Statements of Cash Flows\n\nYears ended March 31, 2024, 2025 and 2026\n\n \n\n \n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n \n\nNote\n\n  \n\n2024\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nCash flows from operating activities:\n\n \n\n  \n\n \n\n \n\nProfit (loss) before income taxes\n\n \n\n  \n¥\n1,642,384\n \n \n¥\n1,317,640\n \n \n¥\n(403,300\n)\n\nDepreciation, amortization and impairment losses excluding equipment on operating leases\n\n \n\n  \n \n794,366\n \n \n \n742,863\n \n \n \n1,303,263\n \n\nLoss (gain) on disposal of property, plant and equipment and intangible assets\n\n \n\n \n\n \n\n \n\n(5,224\n\n)\n\n \n\n \n\n22,079\n\n \n\n \n\n \n\n335,897\n\n \n\nShare of (profit) loss of investments accounted for using the equity method\n\n \n\n  \n \n(110,817\n) \n \n \n(982\n) \n \n \n162,080\n \n\nFinance income and finance costs, net\n\n \n\n  \n \n(141,250\n) \n \n \n(169,976\n) \n \n \n(61,735\n)\n\nInterest income and interest costs from financial services, net\n\n \n\n  \n \n(152,041\n) \n \n \n(171,854\n) \n \n \n(191,268\n)\n\nChanges in assets and liabilities\n\n \n\n  \n\n \n\n \n\nTrade receivables\n\n \n\n  \n \n(138,323\n) \n \n \n69,199\n \n \n \n(56,262\n)\n\nInventories\n\n \n\n  \n \n(67,833\n) \n \n \n(79,464\n) \n \n \n81,624\n \n\nTrade payables\n\n \n\n  \n \n36,516\n \n \n \n112,635\n \n \n \n29,534\n \n\nAccrued expenses\n\n \n\n  \n \n157,582\n \n \n \n72,803\n \n \n \n87,069\n \n\nProvisions and retirement benefit liabilities\n\n \n\n  \n \n263,593\n \n \n \n128,447\n \n \n \n525,725\n \n\nReceivables from financial services\n\n \n\n  \n \n(1,454,357\n) \n \n \n(904,344\n) \n \n \n(246,923\n)\n\nEquipment on operating leases\n\n \n\n  \n \n12,661\n \n \n \n(690,110\n) \n \n \n(365,571\n)\n\nOther assets and liabilities\n\n \n\n  \n \n58,325\n \n \n \n(58,502\n) \n \n \n(21,550\n)\n\nOther, net\n\n \n\n  \n \n(42,995\n)\n \n \n(14\n)\n \n \n(15,357\n)\n\nDividends received\n\n \n\n  \n \n158,092\n \n \n \n126,343\n \n \n \n90,083\n \n\nInterest received\n\n \n\n  \n \n560,709\n \n \n \n737,648\n \n \n \n790,595\n \n\nInterest paid\n\n \n\n  \n \n(283,447\n) \n \n \n(439,081\n) \n \n \n(495,270\n) \n\nIncome taxes paid, net of refund\n\n \n\n  \n \n(540,663\n) \n \n \n(523,178\n) \n \n \n(413,373\n)\n\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet cash provided by operating activities\n\n \n\n  \n \n747,278\n \n \n \n292,152\n \n \n \n1,135,261\n \n\nCash flows from investing activities:\n\n \n\n  \n\n \n\n \n\nPayments for additions to property, plant and equipment\n\n \n\n  \n \n(348,680\n) \n \n \n(510,803\n) \n \n \n(612,065\n)\n\nPayments for additions to and internally developed intangible assets\n\n \n\n  \n \n(259,985\n) \n \n \n(336,632\n) \n \n \n(285,480\n)\n\nProceeds from sales of property, plant and equipment and intangible assets\n\n \n\n  \n \n14,418\n \n \n \n12,258\n \n \n \n31,952\n \n\nProceeds from sales of subsidiaries, net of cash and cash equivalents disposed of\n\n \n\n  \n \n(18,544\n) \n \n \n—\n \n \n \n3,596\n \n\nPayments for acquisitions of investments accounted for using the equity method\n\n \n\n  \n \n(173,767\n) \n \n \n(157,013\n) \n \n \n(74,800\n)\n\nProceeds from sales of investments accounted for using the equity method\n\n \n\n  \n \n—\n \n \n \n21,486\n \n \n \n29,708\n \n\nPayments for acquisitions of other financial assets\n\n \n\n  \n \n(282,076\n) \n \n \n(419,222\n) \n \n \n(242,033\n)\n\nProceeds from sales and redemptions of other financial assets\n\n \n\n  \n \n201,367\n \n \n \n447,960\n \n \n \n296,956\n \n\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet cash used in investing activities\n\n \n\n  \n \n(867,267\n) \n \n \n(941,966\n) \n \n \n(852,166\n)\n\nCash flows from financing activities:\n\n \n\n  \n\n \n\n \n\nProceeds from short-term financing liabilities\n\n \n\n  \n \n10,020,736\n \n \n \n8,988,964\n \n \n \n7,542,779\n \n\nRepayments of short-term financing liabilities\n\n \n\n  \n \n(10,045,118\n) \n \n \n(8,648,271\n) \n \n \n(8,228,184\n)\n\nProceeds from long-term financing liabilities\n\n \n\n  \n \n3,654,964\n \n \n \n3,809,432\n \n \n \n4,585,687\n \n\nRepayments of long-term financing liabilities\n\n \n\n  \n \n(2,056,083\n) \n \n \n(2,658,526\n) \n \n \n(2,824,118\n)\n\nDividends paid to owners of the parent\n\n \n\n  \n \n(241,865\n) \n \n \n(347,805\n) \n \n \n(284,390\n)\n\nDividends paid to\nnon-controlling\ninterests\n\n \n\n  \n \n(66,855\n) \n \n \n(67,186\n) \n \n \n(78,199\n)\n\nPurchases and sales of treasury stock, net\n\n \n\n  \n \n(250,009\n) \n \n \n(722,037\n) \n \n \n(670,270\n)\n\nRepayments of lease liabilities\n\n \n\n  \n \n(80,513\n) \n \n \n(78,137\n) \n \n \n(80,222\n)\n\nOther, net\n\n \n\n  \n \n(16,611\n) \n \n \n4,043\n \n \n \n — \n \n\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet cash provided by (used in) financing activities\n\n \n\n  \n \n918,646\n \n \n \n280,477\n \n \n \n(36,917\n)\n\nEffect of exchange rate changes on cash and\ncash equivalents\n\n \n\n  \n \n352,894\n \n \n \n(56,433\n) \n \n \n343,504\n \n\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet change in cash and cash equivalents\n\n \n\n  \n \n1,151,551\n \n \n \n(425,770\n) \n \n \n589,682\n \n\nCash and cash equivalents at beginning of year\n\n \n\n  \n \n3,803,014\n \n \n \n4,954,565\n \n \n \n4,528,795\n \n\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCash and cash equivalents at end of year\n\n \n5\n  \n¥\n4,954,565\n \n \n¥\n4,528,795\n \n \n¥\n5,118,477\n \n\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nSee accompanying notes to consolidated financial statements.\n\n \n\nF-12\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements\n\n(1) Reporting Entity\n\nHonda Motor Co., Ltd. (the “Company”) is a public company domiciled in Japan. The Company and its subsidiaries (collectively “Honda”) develop, manufacture and distribute motorcycles, automobiles, power products and others throughout the world, and also provide financial services to customers and dealers for the sale of those products. Principal manufacturing facilities are located in Japan, the United States of America, Canada, Mexico, China, India, Indonesia, Malaysia, Thailand, Vietnam and Brazil.\n\n(2) Basis of Preparation\n\n(a) Compliance with International Financial Reporting Standards\n\nThe Company’s consolidated financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRS”), as issued by the International Accounting Standards Board (“IASB”). The term “IFRS” also includes International Accounting Standards (IASs) and the related interpretations of the interpretations committees (SIC and IFRIC).\n\n(b) Basis of Measurement\n\nThe consolidated financial statements have been prepared on the historical cost basis, except for certain assets and liabilities separately stated in note 3.\n\n(c) Functional Currency and Presentation Currency\n\nThe consolidated financial statements are presented in Japanese yen, which is the functional currency of the Company. All financial information presented in Japanese yen has been rounded to the nearest million Japanese yen, except when otherwise indicated.\n\n(d) Changes in Presentation\n\nConsolidated statements of cash flows\n\nFor the year ended March 31, 2025, loss (gain) on disposal of property, plant and equipment and intangible assets was included in “Other, net” within cash flows from operating activities. Considering the increase in quantitative materiality of this item, this has been presented as a separate line item from the year ended March 31, 2026. To reflect this change in presentation, the consolidated statements of cash flows for the year ended March 31, 2025 has been reclassified accordingly. As a result of this reclassification, ¥22,065 million previously presented as “Other, net” within cash flows from operating activities for the year ended March 31, 2025 has been presented separately into ¥22,079 million of “Loss (gain) on disposal of property, plant and equipment and intangible assets” and ¥(14) million of “Other, net” within cash flows from operating activities.\n\nThe consolidated statements of cash flows for the year ended March 31, 2024 has also been reclassified accordingly. As a result of this reclassification, ¥(48,219) million previously presented as “Other, net” within cash flows from operating activities for the year ended March 31, 2024 has been reclassified into ¥(5,224) million of “Loss (gain) on disposal of property, plant and equipment and intangible assets” and ¥(42,995) million of “Other, net” within cash flows from operating activities.\n\n \n\nF-13\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(e) New Accounting Standards and Interpretations Not Yet Adopted\n\nNew or amended standards and interpretations that have been issued as of the date of approval of the consolidated financial statements but are not effective and have not yet been adopted by Honda as of March 31, 2026 are as follows.\n\nHonda is currently evaluating the impact of adoption of this standard on the Company’s consolidated financial statements.\n\n \n\nStandards and interpretations\n\n  \n\nMandatory adoption\n(from fiscal years\nbeginning on or after)\n\n  \n\nReporting periods in\nwhich the Company is\nscheduled to adopt the\nstandards\n\n  \n\nOverview of new or amended\nstandards and interpretations\n\nIFRS 18\n\n \n\nPresentation and Disclosure in Financial Statements\n\n  \n\nJanuary 1, 2027\n\n  \n\nFiscal year ending\n\nMarch 31, 2028\n\n  \n\nNew standard which supersedes current standard of presentation and disclosure in financial statements\n\n(f) Use of Estimates and Judgments\n\nThe preparation of consolidated financial statements in accordance with IFRS requires management to make judgments, estimates and assumptions that affect the application of accounting policies, the reported amount of assets, liabilities, revenues and expenses, and the disclosure of contingent assets and liabilities. Actual results could differ from these estimates.\n\nThese estimates and underlying assumptions are reviewed on a continuous basis. Changes in these accounting estimates are recognized in the period in which the estimates are revised and in any future periods affected.\n\nInformation about judgments that have been made in the process of applying accounting policies and that have significant effects on the amounts reported in the consolidated financial statements is as follows:\n\n \n\n \n\n•\n\n \n\nScope of subsidiaries, affiliates and joint ventures (notes 3(a) and 3(b))\n\n \n\n \n\n•\n\n \n\nRecognition of intangible assets arising from development (note 3(h))\n\n \n\n \n\n•\n\n \n\nAccounting for contracts including lease (note 3(i))\n\nInformation about accounting estimates and assumptions that have significant effects on the amounts reported in the consolidated financial statements is as follows:\n\n \n\n \n\n•\n\n \n\nEnd of term residual values of operating lease vehicles (note 3(f))\n\n \n\n \n\n•\n\n \n\nValuation of financial assets measured at amortized cost and debt securities classified into financial assets measured at fair value through other comprehensive income (notes 6, 7 and 8)\n\n \n\n \n\n•\n\n \n\nFair value of financial instruments (note 26)\n\n \n\n \n\n•\n\n \n\nNet realizable value of inventories (note 9)\n\n \n\n \n\n•\n\n \n\nRecoverable amount of\nnon-financial\nassets (notes 11, 12 and 13)\n\n \n\n \n\n•\n\n \n\nMeasurement of provisions (note 17)\n\n \n\n \n\nF-14\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n \n\n•\n\n \n\nMeasurement of net defined benefit liabilities (assets) (note 18)\n\n \n\n \n\n•\n\n \n\nRecoverability of deferred tax assets (note 23)\n\n \n\n \n\n•\n\n \n\nLikelihood and magnitude of outflows of resources embodying economic benefits required to settle contingent liabilities (note 28)\n\n(3) Material Accounting Policies\n\n(a) Basis of Consolidation\n\nThe consolidated financial statements include the accounts of the Company, its subsidiaries which are directly or indirectly controlled by the Company, and those structured entities which are controlled by Honda. All significant intercompany balances and transactions have been eliminated in consolidation.\n\nHonda controls an entity when Honda is exposed or has rights to variable returns from involvement with the entity, and has the ability to affect those returns by using its power, which is the current ability to direct the relevant activities, over the entity. To determine whether or not Honda controls an entity, status of voting rights or similar rights, contractual agreements and other specific factors are taken into consideration.\n\nStructured entities are entities designed so that voting or similar rights are not the dominant factor in deciding who controls the entity. Honda consolidates structured entities over which it has control, by comprehensively determining whether its control over the entity exists based on any contractual arrangements with such entity as well as the percentage of its voting or similar rights in the entity.\n\nThe financial statements of subsidiaries are included in the consolidated financial statements from the date when the control is obtained until the date when the control is lost. The financial statements of subsidiaries have been adjusted in order to ensure consistency with the accounting policies adopted by the Company as necessary.\n\nChanges in the Company’s ownership interests in subsidiaries that do not result in a loss of control are accounted for as equity transactions. When control over a subsidiary is lost, the investment retained after the loss of control is remeasured at fair value as of the date of the loss of control, and any gain or loss on such remeasurement and disposal of the interest sold is recognized in profit or loss.\n\n(b) Investments in Affiliates and Joint Ventures (Investments Accounted for Using the Equity Method)\n\nAffiliates are entities over which Honda has a significant influence over the decisions on financial and operating policies, but does not have control or joint control.\n\nJoint ventures are joint arrangements whereby the parties including Honda that have joint control have rights to the net assets of the arrangement. Joint arrangements are arrangements of which two or more parties have joint control, and joint control is the contractually agreed sharing of control of an arrangement, which exists only when decisions about the relevant activities require the unanimous consent of the parties sharing control.\n\nInvestments in affiliates and joint ventures are accounted for using the equity method from the date when the investees are determined to be affiliates or joint ventures until the date when they ceased to be classified as affiliates or joint ventures. Under the equity method, the investment is initially recognized at cost, and the carrying amount is subsequently increased or decreased, to recognize Honda’s share of profit or loss and other comprehensive income of the affiliate or the joint venture after the date of initial recognition. The financial statements of affiliates and joint ventures have been adjusted in order to ensure consistency with the accounting policies adopted by the Company in applying the equity method, as necessary.\n\n \n\nF-15\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nThe use of the equity method is discontinued from the date when the investees are determined to be no longer affiliates or joint ventures. The investment retained after cessation of the equity method is remeasured at fair value, and any gain or loss on such remeasurement and disposal of the investment is recognized in profit or loss.\n\n(c) Foreign Currency Translations\n\n1) Foreign currency transactions\n\nForeign currency transactions are translated into the respective functional currencies at the exchange rates prevailing when such transactions occur. All foreign currency receivables and payables are translated into the respective functional currencies at the applicable exchange rates at the end of the reporting period. Gains or losses on exchange differences arising on settlement of foreign currency receivables and payables or on their translations at the end of the reporting date are recognized in profit or loss and they are included in finance income and finance costs-other, net in the consolidated statements of income.\n\n2) Foreign operations\n\nAll assets and liabilities of foreign subsidiaries, affiliates and joint ventures (collectively “foreign operations”), which use a functional currency other than Japanese yen, are translated into Japanese yen at the exchange rates at the end of the reporting period. All revenues and expenses of foreign operations are translated into Japanese yen at the average exchange rate for the period except when a functional currency is the currency of a hyperinflationary economy. Exchange differences arising from translation are recognized in other comprehensive income and accumulated in other components of equity in the consolidated statements of financial position. When a foreign operation is disposed of, and control, significant influence or joint control over the foreign operation is lost, the cumulative amount of exchange differences relating to the foreign operation is reclassified from equity to profit or loss.\n\n(d) Financial Instruments\n\nA financial instrument is a contract that gives rise to a financial asset of one entity and a financial liability or equity security of another entity. When Honda becomes a party to the contractual provision of a financial instrument, the financial instrument is recognized either as a financial asset or as a financial liability. When Honda purchases or sells a financial asset, the financial asset is recognized or derecognized at the trade date.\n\n1)\nNon-derivative\nfinancial assets\n\nHonda classifies financial assets other than derivatives into “financial assets measured at amortized cost”, “financial assets measured at fair value through other comprehensive income” or “financial assets measured at fair value through profit or loss”. Honda determines the classification of financial assets upon initial recognition.\n\nFinancial assets are derecognized when the contractual rights to cash flows from the financial assets expire, or when the contractual rights to receive the cash flows from the financial assets are transferred and all risks and rewards of ownership of the financial assets are substantially transferred\n.\n\n \n\nF-16\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nFinancial assets measured at amortized cost\n\nA financial asset is classified into financial assets measured at amortized cost when the asset is held within a business model whose objective is to hold the asset in order to collect the contractual cash flows, and the contractual term of the financial asset gives rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. Financial assets measured at amortized cost except trade receivables arising from contracts with customers are initially measured at their fair value and trade receivables arising from contracts with customers are initially measured at their transaction price. Financial assets measured at amortized cost are subsequently measured at amortized cost using the effective interest method.\n\nFinancial assets measured at fair value\n\nA financial asset other than a financial asset measured at amortized cost is classified into financial assets measured at fair value. The financial assets measured at fair value are further classified into the following categories:\n\nFinancial assets measured at fair value through other comprehensive income\n\nA debt security is classified into financial assets measured at fair value through other comprehensive income when the asset is held within a business model whose objective is achieved by both collecting contractual cash flows and selling financial assets, and the contractual terms of the financial asset give rise on specified dates to cash flows that are solely payments of principal and interest on the principal amount outstanding. The debt securities are initially measured at their fair value, and subsequent changes in fair value are recognized in other comprehensive income except for impairment gain or loss and foreign exchange gain or loss. When the debt securities are derecognized, the cumulative gain or loss previously recognized in other comprehensive income is reclassified from equity to profit or loss.\n\nHonda elects to designate investments in equity securities such as shares, held for maintaining and strengthening the trade relationship as financial assets measured at fair value through other comprehensive income. Equity securities designated as financial assets measured at fair value through other comprehensive income are initially measured at their fair value, and subsequent changes in fair value of the investment are recognized in other comprehensive income. However, dividends from the equity securities are principally recognized in profit or loss. When the equity securities are derecognized, the cumulative gain or loss previously recognized in other comprehensive income is directly reclassified to retained earnings.\n\nFinancial assets measured at fair value through profit or loss\n\nFinancial assets measured at fair value other than financial assets measured at fair value through other comprehensive income are classified into financial assets measured at fair value through profit or loss. Financial assets measured at fair value through profit or loss are initially measured at their fair value, and subsequent changes in fair value are recognized in profit or loss.\n\n(Cash and cash equivalents)\n\nCash and cash equivalents consist of cash on hand, demand deposits, and short-term highly liquid investments that are readily convertible to known amounts of cash and are subject to insignificant risk of changes in value. Honda includes all highly liquid debt instruments with original maturities of three months or less in cash equivalents.\n\n \n\nF-17\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n2)\nNon-derivative\nfinancial liabilities\n\nFinancial liabilities other than derivatives are initially measured at their fair value, and are subsequently measured at amortized cost using the effective interest method.\n\nFinancial liabilities are derecognized, when the obligations specified in the contract are discharged, canceled or expire.\n\n3) Derivatives\n\nHonda has entered into foreign exchange and interest rate agreements to manage currency and interest rate exposures. These agreements include foreign currency forward exchange contracts, currency option contracts, currency swap agreements and interest rate swap agreements.\n\nAll these derivatives are initially recognized as assets or liabilities and measured at fair value, when Honda becomes a party to the contractual provision of the derivatives. Subsequent changes in fair value of derivatives are recognized in profit or loss in the period of the changes, except for the derivatives which the Company designates as cash flow hedges.\n\n4) Hedge accounting\n\nFor foreign currency exposure and interest risk exposure due to foreign currency denominated transactions, the Company designates certain derivatives such as currency swaps as cash flow hedges. At inception of the hedge, the Company documents the risk management objective, nature of the risk being hedged, and relationship between hedging instruments and hedged items based on the strategy for undertaking the hedging applications.\n\nAt inception and on an ongoing basis, the Company also assesses whether the hedging instruments are effective in offsetting changes in the hedged transactions.\n\n(Cash flow hedges)\n\nThe effective portion of changes in the fair value of derivatives designated and qualifying as cash flow hedges is recognized in other comprehensive income. The gain or loss relating to the ineffective portion is recognized immediately in profit or loss. Amounts that were previously recognized in other comprehensive income relating to hedging instruments are reclassified to profit or loss in the same period when the cash flows of the hedged items are recognized in profit or loss.\n\nHedge accounting is discontinued prospectively when the hedging instrument expires or is sold, terminated or exercised, or when the hedge no longer meets the criteria for hedge accounting. When hedge accounting is discontinued, the amount that has been accumulated in other comprehensive income relating to cash flow hedges remains in equity until the future cash flows affect profit or loss. If the hedged future cash flows are no longer expected to occur, the amount recognized in other comprehensive income is immediately reclassified to profit or loss.\n\n5) Offsetting of financial assets and financial liabilities\n\nFinancial assets and financial liabilities are offset and the net amount is presented in the consolidated statements of financial position, only when Honda currently has a legally enforceable right to offset the recognized amounts, and intends either to settle on a net basis or to realize the asset and settle the liability simultaneously.\n\n \n\nF-18\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(e) Inventories\n\nInventories are\nmeasured\nat the lower of cost and net realizable value. The cost of inventories includes purchase costs and conversion costs, and it is determined principally by using the\nfirst-in\n\nfirst-out\nmethod. Conversion cost includes an appropriate share of production overheads on the normal operation capacity. Net realizable value is the estimated selling price in the ordinary course of business less the estimated costs of completion and the estimated costs necessary to make the sale.\n\n(f) Equipment on Operating Leases\n\nEquipment on operating leases is measured based on the cost model and carried at its cost less accumulated depreciation and impairment losses.\n\nA vehicle subject to operating lease is initially measured at its cost. Depreciation of equipment on operating leases is calculated on the straight-line method over the lease term. The depreciable amount is the cost of the vehicle less its residual value.\n\nOur most significant finance subsidiary located in the United States determines contractual residual values of operating lease vehicles at lease inception based on expectations of used vehicle values at the end of their lease term. The finance subsidiary in the United States depreciates operating lease vehicles on a straight-line basis over the lease term to the lower of contract residual values or estimated end of term residual values. The finance subsidiary in the United States assesses its estimates for end of term residual values of lease vehicles, at minimum, on a quarterly basis. Adjustments to estimated residual values are made on a straight-line basis over the remaining term of the lease and are recognized as depreciation expense. Lease customers have the option at the end of the lease term to return the vehicle to the dealer or to buy the vehicle for the contractual residual value (or if purchased prior to lease maturity, for the outstanding contractual balance). Returned lease vehicles can be purchased by the grounding dealer for the contractual residual value (or if purchased prior to lease maturity, for the outstanding contractual balance) or a market based price. Returned lease vehicles that are not purchased by the grounding dealers are sold through online and physical auctions.\n\nEstimated end of term residual values are dependent on the percentage of leased vehicles expected to be returned by lessees and the expected market values of leased vehicles at the end of their lease terms. Factors considered in this evaluation include, among other factors, economic conditions, external market information on new and used vehicles, historical trends, and recent auction values.\n\n(g) Property, Plant and Equipment\n\nProperty, plant and equipment is measured based on the cost model and carried at its cost less accumulated depreciation and impairment losses.\n\nProperty, plant and equipment is initially measured at its cost. Subsequent expenditures on an item of property, plant and equipment acquired, are recognized in the carrying amount of the item, only when it is probable that the expenditure will generate a future economic benefit.\n\nDepreciation of property, plant and equipment, except for land that is not subject to depreciation, is calculated on the straight-line method over the estimated useful life. The depreciable amount is the cost of the asset less the respective estimated residual values.\n\n \n\nF-19\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nThe estimated useful lives used in calculating depreciation of property, plant and equipment are mainly as follows:\n\n \n\n \n•\n \n\nBuildings and structures: 3 to 50 years\n\n \n\n \n•\n \n\nMachinery and equipment: 2 to 20 years\n\nThe depreciation method, useful lives and residual values of property, plant and equipment are reviewed annually at each fiscal year end, and adjusted prospectively, if appropriate.\n\nProperty, plant and equipment in the consolidated statements of financial position includes\n\nright-of-use\n\nassets under lease arrangements. For the accounting for the\n\nright-of-use\n\nassets, see note “(3) Material Accounting Policies (i) Lease.”\n\n(h) Intangible Assets\n\nIntangible assets are measured based on the cost model and carried at their cost less accumulated amortization and impairment losses.\n\n(Research and development)\n\nDevelopment expenditure for a product is capitalized only when there is a technical and commercial feasibility of completing the development, Honda has intention, ability and sufficient resources to use the outcome of the development, it is probable that the outcome will generate a future economic benefit, and the cost can be measured reliably.\n\nCapitalized development cost is measured at the sum of expenditures for development incurred between when the foregoing conditions for capitalization are initially met and when the development is completed, and includes all directly attributable costs to the development process. Capitalized development cost is amortized using the straight-line method over the expected product life cycle of the developed product ranging mainly from 2 to 6 years.\n\nExpenditures on research and other development expenditures which do not meet the foregoing conditions are expensed as incurred.\n\n(Other intangible asset)\n\nOther intangible assets are initially measured at cost and principally amortized using the straight-line method over their estimated useful lives. Other intangible assets are mainly comprised of software for internal use whose estimated useful lives range from 3 to 5 years.\n\nThe amortization method and useful lives of intangible assets are reviewed annually at each fiscal year end, and adjusted prospectively, if appropriate.\n\n(i) Lease\n\nAt inception of a contract, Honda assesses whether a contract is, or contains, a lease. A contract is, or contains, a lease if the contract conveys the right to control the use of an identified asset for a period of time in exchange for consideration. When Honda has the right to obtain substantially all of the economic benefits from use of the identified asset throughout the period of use and the right to direct the use of the identified asset, the contract conveys the right to control the use of the identified asset.\n\n \n\nF-20\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n1) Lease as a lessee\n\nA\n\nright-of-use\n\nasset and a lease liability are recognized at the lease commencement date. The\n\nright-of-use\n\nasset is initially measured at cost, which comprises the amount of initial measurement of the lease liability adjusted for any lease payments made at or before the commencement date, any initial direct costs incurred by the lessee and an estimate of costs to dismantle and remove the underlying asset or to restore the underlying asset. For a contract that contains a lease component and\nnon-lease\ncomponents, Honda has elected not to separate\nnon-lease\ncomponents and account for the lease and\nnon-lease\ncomponents as a single lease component.\n\nThe\n\nright-of-use\n\nasset is measured based on the cost model and carried at its cost less accumulated depreciation and impairment losses. After the initial recognition, depreciation of the\n\nright-of-use\n\nasset is subsequently calculated on the straight-line method from the commencement date to the earlier of the end of the useful life of the underlying asset or the end of the lease term. The estimated useful lives of underlying assets, see note “(3) Material Accounting Policies (g) Property, Plant and Equipment.”\n\nThe lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date, discounted using the interest rate implicit in the lease or, if that rate cannot be readily determined, Honda’s incremental borrowing rate. Lease payments included in the measurement of the lease liability comprise mainly the fixed payments (including the lease payments in an optional renewal period if Honda is reasonably certain to exercise the extension option) and the penalties for termination of a lease unless Honda is reasonably certain not to terminate early.\n\nAfter the initial recognition, the lease liability is measured by increasing the carrying amount to reflect interest that produces a constant periodic rate of interest on the remaining balance of the lease liability and reducing the carrying amount to reflect the lease payments. The lease liability is remeasured if Honda changes its assessment of whether it will exercise an extension or termination option.\n\nWhen the lease liability is remeasured, the amount of the remeasurement of the lease liability is recognized as an adjustment to the\n\nright-of-use\n\nasset. However, if the carrying amount of the\n\nright-of-use\n\nasset is reduced to zero and there is a further reduction in the measurement of the lease liability, any remaining amount of the remeasurement is recognized in profit or loss.\n\n2) Lease as a lessor\n\nFor a contract that is, or contains a lease, the lease is classified as a finance lease if it transfers substantially all the risks and rewards incidental to ownership of an underlying asset and the lease other than finance lease is classified as an operating lease.\n\nHonda assesses the lease classification of a\nsub-lease\nwith reference to the\n\nright-of-use\n\nasset arising from the head lease, not with reference to the underlying asset.\n\nThe finance subsidiaries of the Company engage in the business of leasing vehicles as a lessor. A receivable from customer held under a finance lease is initially recognized at the amount of net investment in the lease which is the gross investment in the lease discounted at the interest rate implicit in the lease, and included in receivables from financial services in the consolidated statements of financial position. Vehicles subject to operating leases are presented as equipment on operating leases in the consolidated statements of financial position.\n\nIf a contract contains lease and\nnon-lease\ncomponents, Honda applies IFRS 15 to allocate the consideration in the contract.\n\n \n\nF-21\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(j) Impairment\n\n1) Financial assets measured at amortized cost and debt securities classified into financial assets measured at fair value through other comprehensive income\n\nThe allowance for impairment losses of financial assets measured at amortized cost other than trade receivables and debt securities classified into financial assets measured at fair value through other comprehensive income is measured at amounts according to the three-stage expected credit loss (ECL) model:\n\n \n\n \nStage 1\n\n12-month\nECL for financial assets without a significant increase in credit risk since initial recognition\n\n \n\n \nStage 2\n\nLifetime ECL for financial assets with a significant increase in credit risk since initial recognition but that are not credit-impaired\n\n \n\n \nStage 3\n\nLifetime ECL for credit-impaired financial assets\n\nThe allowance for impairment losses of trade receivables is continuously measured at amounts equal to lifetime ECL.\n\nLifetime ECL represents ECL that results from all possible default events over the expected life of a financial asset.\n12-month\nECL is the portion of lifetime ECL that results from default events that are possible within 12 months after the reporting date. ECL is a probability-weighted estimate of the difference between the contractual cash flows and the cash flows that the entity expects to receive, discounted at the original effective interest\n\nrates.\n\nReceivables from financial services – Allowance for credit losses\n\nThe allowance for credit losses is management’s estimate of ECL on receivables from financial services.\n\nTo determine whether credit risk has increased significantly, consumer finance receivables are assessed both individually and collectively. Individual assessments are based on delinquencies. Consumer finance receivables 30 days or greater past due have historically experienced increased default rates and therefore are considered to have a significant increase in credit risk. Collective assessments are performed for groups of consumer finance receivables with shared risk characteristics such as the period of initial recognition, collateral type, original term, and credit score considering relative changes in expected default rates since initial recognition. Dealer finance receivables are assessed at the individual dealership level to determine whether credit risk has increased significantly considering payment performance and other factors such as changes in the financial condition of the dealership and compliance with debt covenants.\n\nOur definition of default on receivables from financial services varies depending on internal risk management practices of each of our finance subsidiaries. Our most significant finance subsidiary located in the United States considers delinquencies of 60 days past due to be in default. Collection efforts on consumer finance receivables are escalated after becoming 60 days past due including repossession of the underlying vehicles if it has been determined that the borrower is unable to perform on their obligations. Defaulted consumer finance receivables are considered to be credit-impaired. Dealer finance receivables are considered to be credit-impaired when there is evidence we will be unable to collect all amounts due in accordance with the original contractual terms including significant financial difficulty of the dealership, a breach of contract, such as a default or delinquency, or bankruptcy.\n\n \n\nF-22\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nAt the finance subsidiary in the United States, the estimated uncollectible portion of consumer finance receivables are\nwritten-off\nat 120 days past due or upon repossession of the underlying vehicle. Although various statutory regulations limit the length of time and circumstances when enforcement activities can be taken, in general, the outstanding contractual balances continue to be subject to enforcement activities for several years after write-offs. The portion of outstanding contractual balances that is estimated to be uncollectible reflects our expectations of collections from enforcement activities. Dealer finance receivables are\nwritten-off\nwhen there is no reasonable expectation of recovery.\n\nAt the finance subsidiary in the United States, ECL of consumer finance receivables is measured for groups of financial assets with shared risk characteristics by reflecting historical results, current conditions and forward-looking factors such as unemployment rates, used vehicles prices, and consumer debt service burdens.\n\n2)\nNon-financial\nassets and investments accounted for using the equity method\n\nAt the end of the reporting period, the carrying amount of\nnon-financial\nassets other than inventories and deferred tax assets (which are comprised mainly of equipment on operating leases, property, plant and equipment, and intangible assets) is assessed to determine whether or not there is any indication of impairment. If there is such an indication, the recoverable amount of such asset is estimated and compared with the carrying amount of the asset, as test of impairment.\n\nFor investments accounted for using the equity method, the entire carrying amount of each investment in affiliates and joint ventures is tested for impairment as a single asset, when there is objective evidence that the investments accounted for using the equity method may be impaired.\n\nThe recoverable amount of an individual asset or a cash-generating unit is the higher of fair value less costs to sell and value in use. Value in use is determined as the present value of future cash flows expected to be derived from an asset or a cash-generating unit. A cash-generating unit is determined as the smallest identifiable group of assets that generate cash inflows which are largely independent of cash inflows from other assets or a group of assets. When it is not possible to estimate the recoverable amount of the individual asset, the recoverable amount of the cash-generating unit to which the asset belongs is estimated.\n\nWhen the carrying amount of an asset or a cash-generating unit exceeds the recoverable amount, the carrying amount is reduced to the recoverable amount and an impairment loss is recognized in profit or loss. An impairment loss for a cash-generating unit is allocated to the assets on the basis of the relative carrying amount of each asset in the unit.\n\nAn impairment loss recognized for an asset or a cash-generating unit in prior period is reversed, if there is any indication that the impairment loss may have decreased or may no longer exist, and when the recoverable amount of the asset exceeds the carrying amount. If this is the case, the carrying amount of the asset is increased to its recoverable amount, but the increased carrying amount does not exceed the carrying amount (net of depreciation or amortization) calculated on the basis that no impairment loss had occurred in the prior period.\n\n(k) Provisions\n\nProvisions are recognized when Honda has present legal or constructive obligation as a result of past events, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation.\n\n \n\nF-23\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes\nto Consolidated Financial Statements—(Continued)\n\n \n\nProvisions are measured based on the best estimate of expenditure required to settle the present obligation at the end of the reporting period. Where the effect of the time value of money is material, a provision is measured at the present value of the expenditures required to settle the obligation. In calculating the present value, a\npre-tax\nrate that reflects current market assessment of the time value of money and the risks specific to the liability is used as the discount rate.\n\n(l) Employee Benefits\n\n1) Short-term employee benefits\n\nFor short-term employee benefits including salaries, bonuses and paid annual leave, when the employees render related services, the amounts expected to be paid in exchange for those services are recognized as expenses.\n\n2) Post-employment benefits\n\nHonda has various post-employment benefit plans including defined benefit plans and defined contribution plans.\n\nDefined benefit plans\n\nFor defined benefit plans, the present value of defined benefit obligations less the fair value of plan assets is recognized as either liability or asset in the consolidated statements of financial position. In the case that an entity has a surplus in a defined benefit plan, the recognized asset is limited to present value of any economic benefits available in the form of refunds from the plan or reductions in future contributions to the plan.\n\nThe present value of defined benefit obligations and service cost are principally determined for each plan using the projected unit credit method. The discount rate is determined by reference to market yields at the end of the reporting period on high quality corporate bonds that are consistent with the currency and estimated term of the post-employment benefit obligation. Net interest on the net defined benefit liability (asset) for the reporting period is determined by multiplying the net defined benefit liability (asset) by the discount rate.\n\nPast service cost defined as the change in the present value of the defined benefit obligation resulting from a plan amendment or curtailment is recognized in profit or loss upon occurrence of the plan amendment or curtailment.\n\nHonda recognizes the difference arising from remeasurement of present value of the defined benefit obligations and the fair value of the plan assets in other comprehensive income when it is incurred, and reclassifies it immediately to retained earnings.\n\nDefined contribution plans\n\nFor defined contribution plans, when the employees render related services, the contribution payables to defined contribution plan are recognized as expenses.\n\n(m) Equity\n\n1) Common share\n\nCommon share issued by the Company is classified as equity, and the proceeds from issuance of common share are included in common stock and capital surplus.\n\n \n\nF-24\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n2) Treasury stock\n\nTreasury stock acquired by Honda is recognized at cost and deducted from equity. When treasury stock is sold, the consideration received is recognized as equity with the difference between the carrying amount and the consideration received included in capital surplus.\n\n(n) Revenue\nRecognition\n\n1) Sale of products\n\nSales of products are reported by Motorcycle business, Automobile business, Power products and other businesses. For details of the information on each business, see note 4.\n\nHonda recognizes revenue when control over products is transferred to customers. This transfer generally corresponds to the date of delivery of products to customers. Revenue is measured based on consideration specified in a contract with customer and excludes amounts collected on behalf of third parties. The total consideration in the contract is allocated to all products and services based on their stand-alone selling prices. The stand-alone selling prices are determined with reference to the selling prices of similar products or services and other reasonably available information.\n\nHonda provides dealer incentives, which generally represent discounts provided from Honda to the dealer. Honda also provides incentive programs generally in the form of below-market interest rate loans or lease programs for the retail customers to enhance dealer’s sales activities. The amount incurred for these programs is calculated based on the difference between the interest or lease rate offered to retail customers and the market-based interest or lease rate. These incentives are considered variable consideration when determining the transaction price and they are deducted from sales revenue recognized when products are sold to the dealers. Sales revenue is recognized only to the extent that it is highly probable that a significant reversal will not occur when the uncertainty associated with the variable consideration is subsequently resolved.\n\nCustomers usually pay consideration for sales of products within 30 days from the transfers of control over the products to customers.\n\nIn addition, product sales contracts with customers include warranty clauses to guarantee that the products comply with agreed-upon specifications and Honda recognizes provisions for product warranties to meet these guarantees. For more information on product warranties, see note 17.\n\n2) Rendering of financial services\n\nInterest income from receivables from financial services is recognized using the effective interest method. Finance receivable origination fees and certain direct origination costs are included in the calculation of the effective interest rate, and the net fee or cost is amortized using the effective interest method over the contractual term of the finance receivables.\n\nThe finance subsidiaries of the Company offer financial services that contain a lease. Interest income from receivables held under a finance lease is recognized using the effective interest method. When Honda is the manufacturer or dealer lessor, sales revenue and the corresponding cost for a portion identified as sale of products is recognized in profit or loss in accordance with the policy on revenue recognition for sale of products. Revenue from operating leases is recognized on a straight-line basis over the term of the lease.\n\n(o) Income Taxes\n\nIncome tax expenses are presented as the aggregate amount of current taxes and deferred taxes. Current taxes and deferred taxes are recognized in profit or loss, except for the tax arising from a transaction which is recognized either in other comprehensive income or directly in equity.\n\n \n\nF-25\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nCurrent taxes are measured at the amount expected to be paid to (or recovered from) the taxation authorities in respect of the taxable profit (or tax loss) for the reporting period, using the tax rates and tax laws enacted or substantively enacted at the end of the reporting period.\n\nDeferred tax assets and liabilities are recognized for future tax consequences attributable to temporary differences between the carrying amount of assets or liabilities in the consolidated statements of financial position and the tax base of the assets or liabilities and carryforward of unused tax losses and tax credits. Deferred tax assets are recognized to the extent that it is probable that taxable profit will be available against which the deductible temporary differences, unused tax losses, and unused tax credits can be utilized.\n\nDeferred tax liabilities for taxable temporary differences related to investments in subsidiaries and affiliates, and interest in joint ventures are not recognized to the extent that Honda is able to control the timing of the reversal of the temporary differences and it is probable that they will not reverse in the foreseeable future. Deferred tax assets for deductible temporary differences arising from investments in subsidiaries and affiliates, and interest in joint ventures are recognized to the extent that it is probable that the temporary differences will reverse in the foreseeable future and taxable profit will be available against which they can be utilized.\n\nDeferred tax assets and liabilities are measured at the tax rates that are expected to apply in the period when the assets are realized or the liabilities are settled, based on the tax rates and tax laws enacted or substantively enacted at the end of the reporting period. The measurement of deferred tax assets and liabilities reflects the tax consequences that would follow from the manner in which Honda expects, at the end of reporting period, to recover or settle the carrying amount of its assets and liabilities.\n\nHonda reviews the carrying amount of deferred tax assets at the end of each reporting period, and reduces the carrying amount of deferred tax assets to the extent that it is no longer probable that sufficient taxable profit will be available to allow the benefit of part or all of that deferred tax assets to be utilized.\n\nDeferred tax assets and deferred tax liabilities are offset, only when Honda has a legally enforceable right to set off current tax assets against current tax liabilities, and the same taxation authority levies income taxes either on the same taxable entity or on different taxable entity which intends either to settle current tax liabilities and assets on a net basis or to realize the assets and settle the liabilities simultaneously.\n\nHonda reflects the effect of uncertainty in the consolidated financial statements if Honda concludes it is not probable that the taxation authority will accept the tax treat\n\nment.\n\nHonda has adopted amendments to IAS 12 “International Tax Reform - Pillar Two Model Rules” issued on May 23, 2023, and has neither recognized nor disclosed information about deferred tax assets and liabilities related to the income taxes arising from tax law enacted or substantively enacted to implement the Pillar Two model rules published by the Organisation for Economic\n \n\nCo-operation\n\n \nand Development(OECD), including tax law that implements qualified domestic minimum\n \n\ntop-up\n\n \ntaxes described in those rules.\n\n(p) Earnings per Share\n\nBasic earnings per share is calculated by dividing profit for the year attributable to owners of the parent by the weighted average number of common shares outstanding during the period.\n\n \n\nF-26\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(4) Segment Information\n\nBased on Honda’s organizational structure and characteristics of products and services, Honda discloses segment information in four categories: Reportable segments of Motorcycle business, Automobile business and Financial services business, and other segments that are not reportable. The other segments are combined and disclosed in Power products and other businesses. Segment information is based on the components of Honda for which separate financial information is available that is evaluated regularly by the chief operating decision maker in deciding how to allocate resources and in assessing performance. The accounting policies used for segment information are consistent with the accounting policies used in the Company’s consolidated financial statements.\n\nPrincipal products and services, and functions of each segment are as follows:\n\n \n\nSegment\n\n \n\nPrincipal products and services\n\n \n\nFunctions\n\nMotorcycle Business\n \nMotorcycles,\nall-terrain\nvehicles (ATVs),\n\nside-by-sides\n\n(SxS) and relevant parts\n \nResearch and development\nManufacturing\nSales and related services\n\nAutomobile Business\n \nAutomobiles and relevant parts\n \nResearch and development\nManufacturing\nSales and related services\n\nFinancial Services Business\n \nFinancial services\n \nRetail loan and lease related to\nHonda products Others\n\nPower Products and Other Businesses\n \nPower products and relevant parts, and others\n \nResearch and development\nManufacturing\nSales and related services\nOthers\n\n \n\nF-27\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(a) Segment Information\n\nSegment information as of and for the years ended March 31, 2024, 2025 and 2026 is as follows:\n\nAs of and for the year ended March 31, 2024\n\n \n\n \n \n\nYen (millions)\n\n \n\n \n \n\nMotorcycle\nBusiness\n\n \n \n\nAutomobile\nBusiness\n\n \n \n\nFinancial\nServices\nBusiness\n\n \n \n\nPower\nProducts\nand Other\nBusinesses\n\n \n \n\nSegment\nTotal\n\n \n \n\nReconciling\nItems\n\n \n \n\nConsolidated\n\n \n\nSales revenue:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nExternal customers\n\n \n¥\n3,220,168\n \n \n¥\n13,567,565\n \n \n¥\n3,248,808\n \n \n¥\n392,261\n \n \n¥\n20,428,802\n \n \n¥\n— \n \n \n¥\n20,428,802\n \n\nIntersegment\n\n \n \n— \n \n \n \n223,950\n \n \n \n2,976\n \n \n \n30,068\n \n \n \n256,994\n \n \n \n(256,994\n) \n \n \n— \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n \n \n3,220,168\n \n \n \n13,791,515\n \n \n \n3,251,784\n \n \n \n422,329\n \n \n \n20,685,796\n \n \n \n(256,994\n) \n \n \n20,428,802\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nSegment profit (loss)\n\n \n¥\n556,232\n \n \n¥\n560,649\n \n \n¥\n273,978\n \n \n¥\n(8,882\n) \n \n¥\n1,381,977\n \n \n¥\n— \n \n \n¥\n1,381,977\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nShare of profit (loss) of investments accounted for using the equity method\n\n \n¥\n53,843\n \n \n¥\n55,392\n \n \n¥\n— \n \n \n¥\n1,582\n \n \n¥\n110,817\n \n \n¥\n— \n \n \n¥\n110,817\n \n\nSegment assets\n\n \n \n2,047,270\n \n \n \n11,690,446\n \n \n \n14,118,371\n \n \n \n585,301\n \n \n \n28,441,388\n \n \n \n1,332,762\n \n \n \n29,774,150\n \n\nInvestments accounted for using the equity\nmethod\n\n \n \n119,598\n \n \n \n1,076,481\n \n \n \n— \n \n \n \n10,889\n \n \n \n1,206,968\n \n \n \n— \n \n \n \n1,206,968\n \n\nDepreciation and amortization\n\n \n \n72,590\n \n \n \n655,250\n \n \n \n834,246\n \n \n \n17,400\n \n \n \n1,579,486\n \n \n \n— \n \n \n \n1,579,486\n \n\nCapital expenditures\n\n \n \n74,006\n \n \n \n598,475\n \n \n \n2,451,930\n \n \n \n16,768\n \n \n \n3,141,179\n \n \n \n— \n \n \n \n3,141,179\n \n\nImpairment losses on\nnon-financial\nassets\n\n \n \n33\n \n \n \n44,652\n \n \n \n14,646\n \n \n \n61\n \n \n \n59,392\n \n \n \n— \n \n \n \n59,392\n \n\nProvision (reversal) for credit and lease residual losses on receivables from financial services\n\n \n \n— \n \n \n \n— \n \n \n \n50,057\n \n \n \n— \n \n \n \n50,057\n \n \n \n— \n \n \n \n50,057\n \n\nAs of and for the year ended March 31, 2025\n\n \n\n \n \n\nYen (millions)\n\n \n\n \n \n\nMotorcycle\nBusiness\n\n \n \n\nAutomobile\nBusiness\n\n \n \n\nFinancial\nServices\nBusiness\n\n \n \n\nPower\nProducts\nand Other\nBusinesses\n\n \n \n\nSegment\nTotal\n\n \n \n\nReconciling\nItems\n\n \n \n\nConsolidated\n\n \n\nSales revenue:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nExternal customers\n\n \n¥\n3,626,603\n \n \n¥\n14,169,240\n \n \n¥\n3,507,766\n \n \n¥\n385,158\n \n \n¥\n21,688,767\n \n \n¥\n— \n \n \n¥\n21,688,767\n \n\nIntersegment\n\n \n \n— \n \n \n \n298,616\n \n \n \n4,457\n \n \n \n29,452\n \n \n \n332,525\n \n \n \n(332,525\n) \n \n \n — \n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n \n \n3,626,603\n \n \n \n14,467,856\n \n \n \n3,512,223\n \n \n \n414,610\n \n \n \n22,021,292\n \n \n \n(332,525\n) \n \n \n21,688,767\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nSegment profit (loss)\n\n \n¥\n663,443\n \n \n¥\n243,853\n \n \n¥\n315,634\n \n \n¥\n(9,444\n) \n \n¥\n1,213,486\n \n \n¥\n— \n \n \n¥\n1,213,486\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nShare of profit (loss) of investments accounted for using the equity method\n\n \n¥\n59,060\n \n \n¥\n(59,867\n) \n \n¥\n— \n \n \n¥\n1,789\n \n \n¥\n982\n \n \n¥\n— \n \n \n¥\n982\n \n\nSegment assets\n\n \n \n2,248,809\n \n \n \n11,874,764\n \n \n \n15,713,348\n \n \n \n576,347\n \n \n \n30,413,268\n \n \n \n362,599\n \n \n \n30,775,867\n \n\nInvestments accounted for using the equity method\n\n \n \n107,889\n \n \n \n1,117,102\n \n \n \n— \n \n \n \n17,623\n \n \n \n1,242,614\n \n \n \n— \n \n \n \n1,242,614\n \n\nDepreciation and amortization\n\n \n \n72,443\n \n \n \n642,506\n \n \n \n881,500\n \n \n \n16,356\n \n \n \n1,612,805\n \n \n \n— \n \n \n \n1,612,805\n \n\nCapital expenditures\n\n \n \n94,688\n \n \n \n797,831\n \n \n \n3,125,821\n \n \n \n18,468\n \n \n \n4,036,808\n \n \n \n— \n \n \n \n4,036,808\n \n\nImpairment losses on\nnon-financial\nassets\n\n \n \n99\n \n \n \n18,477\n \n \n \n20,660\n \n \n \n69\n \n \n \n39,305\n \n \n \n— \n \n \n \n39,305\n \n\nProvision (reversal) for credit and lease residual losses on receivables from financial services\n\n \n \n— \n \n \n \n— \n \n \n \n70,963\n \n \n \n— \n \n \n \n70,963\n \n \n \n— \n \n \n \n70,963\n \n\n \n\nF-28\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nAs of and for the year ended March 31, 2026\n\n \n\n \n\n \n\nYen (millions)\n\n \n\n \n\n \n\nMotorcycle\nBusiness\n\n \n\n \n\nAutomobile\nBusiness\n\n \n\n \n\nFinancial\nServices\nBusiness\n\n \n\n \n\nPower\nProducts\nand Other\nBusinesses\n\n \n\n \n\nSegment\nTotal\n\n \n\n \n\nReconciling\nItems\n\n \n\n \n\nConsolidated\n\n \n\nSales revenue:\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nExternal customers\n\n \n¥\n4,018,837\n \n \n¥\n13,863,362\n \n \n¥\n3,529,484\n \n \n¥\n384,927\n \n \n¥\n21,796,610\n \n \n¥\n—\n \n \n¥\n21,796,610\n \n\nIntersegment\n\n \n \n—\n \n \n \n303,548\n \n \n \n3,259\n \n \n \n35,449\n \n \n \n342,256\n \n \n \n(342,256\n) \n \n \n—\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n \n \n4,018,837\n \n \n \n14,166,910\n \n \n \n3,532,743\n \n \n \n420,376\n \n \n \n22,138,866\n \n \n \n(342,256\n)\n \n \n21,796,610\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nSegment profit (loss)\n\n \n¥\n731,926\n \n \n¥\n(1,411,140\n)\n \n¥\n275,532\n \n \n¥\n(10,664\n) \n \n¥\n(414,346\n) \n \n¥\n—\n \n \n¥\n(414,346\n)\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nShare of profit (loss) of investments accounted for using the equity method\n\n \n¥\n65,206\n \n \n¥\n(228,369\n) \n \n¥\n—\n \n \n¥\n1,083\n \n \n¥\n(162,080\n)\n \n¥\n—\n \n \n¥\n(162,080\n) \n\nSegment assets\n\n \n \n2,713,735\n \n \n \n12,484,767\n \n \n \n17,282,581\n \n \n \n593,582\n \n \n \n33,074,665\n \n \n \n434,620\n \n \n \n33,509,285\n \n\nInvestments accounted for using the equity method\n\n \n \n106,438\n \n \n \n1,005,559\n \n \n \n—\n \n \n \n16,121\n \n \n \n1,128,118\n \n \n \n—\n \n \n \n1,128,118\n \n\nDepreciation and amortization\n\n \n \n74,343\n \n \n \n601,267\n \n \n \n958,880\n \n \n \n16,055\n \n \n \n1,650,545\n \n \n \n—\n \n \n \n1,650,545\n \n\nCapital expenditures\n\n \n \n135,989\n \n \n \n879,031\n \n \n \n2,766,150\n \n \n \n23,539\n \n \n \n3,804,709\n \n \n \n—\n \n \n \n3,804,709\n \n\nImpairment losses on\nnon-financial\nassets\n\n \n \n95\n \n \n \n605,150\n \n \n \n81,833\n \n \n \n4,928\n \n \n \n692,006\n \n \n \n—\n \n \n \n692,006\n \n\nProvision (reversal) for credit and lease residual losses on receivables from financial services\n\n \n \n—\n \n \n \n—\n \n \n \n87,920\n \n \n \n—\n \n \n \n87,920\n \n \n \n—\n \n \n \n87,920\n \n\n \n\nExplanatory notes:\n\n \n\n1.\n\nSegment profit (loss) of each segment is measured in a consistent manner with consolidated operating profit (loss), which is profit (loss) before income taxes before share of profit (loss) of investments accounted for using the equity method and finance income and finance costs. Expenses not directly associated with specific segments are allocated based on the most reasonable measures applicable.\n\n2.\n\nSegment assets of each segment are defined as total assets including investments accounted for using the equity method, derivatives, and deferred tax assets. Segment assets are based on those directly associated with each segment and those not directly associated with specific segments are allocated based on the most reasonable measures applicable except for the corporate assets described below.\n\n3.\n\nIntersegment sales revenues are generally made at values that approximate\narm’s-length\nprices.\n\n4.\n\nReconciling items include elimination of intersegment transactions and balances as well as unallocated corporate assets. Unallocated corporate assets, included in reconciling items as of March 31, 2024, 2025 and 2026 amounted to ¥1,573,834 million, ¥979,954 million and ¥\n976,245\nmillion, respectively, which consist primarily of the Company’s cash and cash equivalents and financial assets measured at fair value through other comprehensive income.\n\n5.\n\nProvisions for product warranties accrued for the years ended March 31, 2024, 2025 and 2026 are ¥536,590 million, ¥454,502 million and ¥\n319,613\nmillion, respectively. These are mainly included in Automobile business.\n\n6.\n\nThe amounts of write-down of inventories recognized as an expense for the years ended March 31, 2024, 2025 and 2026 are ¥12,220 million, ¥120,919 million and ¥\n\n49,804\n\nmillion respectively. These are mainly included in Automobile business.\n\n7.\n\nRight-of-use\n\nassets are not included in Capital expenditures.\n\n8.\n\nThe assets and liabilities related to a group of subsidiaries primarily engaged in the manufacture and sale of automobile parts are classified as held for sale as a disposal group in accordance with IFRS 5, “Non-current Assets Held for Sale and Discontinued Operations,” for the year ended March 31, 2026. Accordingly, an impairment loss of ¥48,328 million is recognized in cost of sales in the consolidated statements of income for the year ended March 31, 2026. The disposal group is mainly attributable to the Automobile business. The carrying amount of the assets classified as part of the disposal group after the recognition of the impairment loss amounts to ¥106,097 million as of March 31, 2026 and is included in “Other current assets” in the consolidated statements of financial position. In addition, the carrying amount of the liabilities classified as part of the disposal group is included in “Other current liabilities” in the consolidated statements of financial position and is immaterial. The balances of each class of assets and liabilities included in the disposal group are individually immaterial and have been omitted.\n\n \n\nF-29\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(b) Product or Service Groups Information\n\nSales revenue by product or service groups of Honda for the years ended March 31, 2024, 2025 and 2026 is as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2024\n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nMotorcycles,\nall-terrain\nvehicles (ATVs),\n\nside-by-sides\n\n(SxS) and relevant parts\n\n  \n¥\n3,220,168\n \n  \n¥\n3,626,603\n \n  \n¥\n4,018,837\n \n\nAutomobiles and relevant parts\n\n  \n \n15,227,546\n \n  \n \n15,818,947\n \n  \n \n15,327,187\n \n\nFinancial services\n\n  \n \n1,588,827\n \n  \n \n1,858,059\n \n  \n \n2,065,659\n \n\nPower products and relevant parts\n\n  \n \n292,563\n \n  \n \n285,253\n \n  \n \n281,311\n \n\nOthers\n\n  \n \n99,698\n \n  \n \n99,905\n \n  \n \n103,616\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n20,428,802\n \n  \n¥\n21,688,767\n \n  \n¥\n21,796,610\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n(c) Geographical Information\n\nThe sales revenue and carrying amounts of\nnon-current\nassets other than financial instruments, deferred tax assets and net defined benefit assets based on the location of the Company and its subsidiaries as of and for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\nAs of and for the year ended March 31, 2024\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\nJapan\n\n \n  \n\nUnited\nStates\n\n \n  \n\nOther\nCountries\n\n \n  \n\nTotal\n\n \n\nSales revenue\n\n  \n¥\n2,634,505\n \n  \n¥\n10,343,985\n \n  \n¥\n7,450,312\n \n  \n¥\n20,428,802\n \n\nNon-current\nassets other than financial instruments, deferred tax assets and net defined benefit assets\n\n  \n¥\n3,054,330\n \n  \n¥\n4,914,193\n \n  \n¥\n1,822,125\n \n  \n¥\n9,790,648\n \n\nAs of and for the year ended March 31, 2025\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\nJapan\n\n \n  \n\nUnited\nStates\n\n \n  \n\nOther\nCountries\n\n \n  \n\nTotal\n\n \n\nSales revenue\n\n  \n¥\n2,845,609\n \n  \n¥\n11,388,564\n \n  \n¥\n7,454,594\n \n  \n¥\n21,688,767\n \n\nNon-current\nassets other than financial instruments, deferred tax assets and net defined benefit assets\n\n  \n¥\n3,329,692\n \n  \n¥\n5,441,006\n \n  \n¥\n1,699,183\n \n  \n¥\n10,469,881\n \n\nAs of and for the year ended March 31, 2026\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\nJapan\n\n \n  \n\nUnited\nStates\n\n \n  \n\nOther\nCountries\n\n \n  \n\nTotal\n\n \n\nSales revenue\n\n  \n¥\n2,882,484\n \n  \n¥\n11,160,904\n \n  \n¥\n7,753,222\n \n  \n¥\n21,796,610\n \n\nNon-current\nassets other than financial instruments, deferred tax assets and net\ndefined benefit assets\n\n  \n¥\n3,212,461\n \n  \n¥\n5,834,391\n \n  \n¥\n1,722,783\n \n  \n¥\n10,769,635\n \n\n \n\nF-30\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(d) Impact on Automobile business due to changes in the EV market environment\n\nThe Company has been promoting initiatives toward electrification of its automobile business with the aim of achieving carbon neutrality for all products and corporate activities Honda is involved in by 2050. However, the business environment surrounding the Company has been changing rapidly, and the outlook remains uncertain. In the United States, the expansion of the EV market has slowed due to revisions to EV incentives and the easing of fossil fuel regulations, resulting in impacts such as a decrease in EV sales volume and an increase in sales incentives. Given the changes in the market environment, as part of the revision of its product launch plans, the Company decided during the year ended March 31, 2026 to cancel the launch and development of a certain EV model, and to discontinue production or reduce production volume for EV models jointly developed under a certain alliance agreement. Furthermore, on March 12, 2026, the Company reassessed its automobile electrification strategy and made additional decisions, including the cancellation of development and market launch of certain EV models that had been planned for production in North America. In addition, for certain EV models jointly developed with a joint venture of the Company and scheduled to be manufactured by the Company’s subsidiary in North America, the joint venture decided to cancel their development and market launch. In China, while the EV market continues to grow, competition has intensified due to the rapid emergence of new EV manufacturers. Under such a challenging and competitive environment, the Company has also revised its product launch plans for certain EV models.\n\nAs a result, for the year ended March 31, 2026, the Company and its certain consolidated subsidiaries recognized losses and expenses of ¥1,047,918 million in cost of sales, ¥7,889 million in selling, general and administrative expenses, ¥397,870 million in research and development expenses, and ¥124,128 million in share of profit (loss) of investments accounted for using the equity method in the consolidated statements of income. These losses and expenses are included in Automobile business. The breakdown of these losses and expenses is as follows.\n\nImpairment losses and losses on disposal of non-financial assets\n\nImpairment losses (¥521,377 million) and losses on disposal (¥331,426 million) of non-financial assets mainly consist of the following items and are recorded in cost of sales of ¥454,933 million and research and development expenses of ¥397,870 million in the consolidated statements of income for the year ended March 31, 2026.\n\n \n\n \n\n-\n\nImpairment losses (¥521,377 million): Impairment losses mainly on property, plant and equipment and other non-current assets (including manufacturing equipment) related to EV models in North America for which the Company decided to discontinue production or cancel development and market launch, as well as impairment losses on intangible assets (capitalized development costs) related to EV models discontinued in North America and certain EV models in China. The recoverable amount of these non-financial assets is measured at fair value less costs of disposal; however, as the assets cannot be practically sold or repurposed, the Company assessed the fair value less costs of disposal as zero. A Level 3 fair value hierarchy is assigned since observable inputs are not available.\n\n \n\n \n\n-\n\nLosses on disposal (¥331,426 million): Losses resulting from derecognition of intangible assets (capitalized development costs) related to EV models in North America for which development was canceled prior to market launch.\n\n \n\nF-31\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nFor the year ended March 31, 2026, the Company reached an agreement with the counterparty sharing control of the joint venture regarding compensation for the expenditures incurred by the Company’s consolidated subsidiary in North America, including investments in dedicated production equipment for EV models for which the joint venture decided to cancel development and market launch. Pursuant to the agreement, the Company’s consolidated subsidiary in North America recognized the compensation from the joint venture amounting to ¥66,492 million, in other receivables, which is presented within trade receivables in the consolidated statements of financial position and is included in cost of sales in the consolidated statements of income. In addition, the reimbursement costs recognized by the joint venture are included in the share of profit (loss) of investments accounted for using the equity method.\n\nShare of profit (loss) of investments accounted for using the equity method\n\nShare of profit (loss) of investments accounted for using the equity method (¥124,128 million) includes, in addition to the reimbursement costs recognized by the joint venture described above, impairment losses of ¥90,882 million on investments accounted for using the equity method related to certain joint ventures in China.\n\nProvisions for EV-related losses\n\nProvisions for EV-related losses include provisions recognized due to changes in the EV market environment and the reassessment of the automobile electrification strategy. Additional provisions (¥667,366 million) mainly consist of the following items:\n\n \n\n \n\n-\n\nAdditional provisions of ¥106,296 million were recognized for an onerous contract under the alliance agreement, primarily due to a shift in the United States government policy, including the imposition of tariffs, the elimination of tax incentives for EV purchases, and the easing of emissions regulations, as well as a reduction in production volume, which resulted in decreased economic benefits and increased costs.\n\n \n\n \n\n-\n\nAdditional provisions of ¥561,070 million were recognized for losses or expenses arising from contracts entered into with other parties in relation to EV models, including compensation related to alliance agreements and contracts for parts supply and procurement.\n\nFor information on subsequent event related to the reassessment of the automobile electrification strategy, see note 31.\n\n(5) Cash and Cash Equivalents\n\nCash and cash equivalents as of March 31, 2025 and 2026 consist of the following:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nCash and deposits\n\n  \n¥\n3,261,111\n \n  \n¥\n3,852,220\n \n\nCash equivalents\n\n  \n \n1,267,684\n \n  \n \n1,214,608\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nCash and cash equivalents in the consolidated statements of financial position\n\n  \n¥\n4,528,795\n \n  \n¥\n5,066,828\n \n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\nCash and cash equivalents included in assets held for sale\n\n \n\n¥\n\n—\n\n \n\n \n\n¥\n\n51,649\n\n \n\nCash and cash equivalents in the consolidated statements of cash flows\n\n \n\n¥ \n4,528,795\n\n \n\n \n\n¥\n\n5,118,477\n\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nCash equivalents held by Honda mainly consist of money market funds and certificates of deposit. In addition, assets held for sale as of March 31, 2026 are presented in other current assets in the consolidated statements of financial position.\n\n \n\nF-32\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(6) Trade\nReceivables\n\nTrade receivables are classified as financial assets measured at amortized cost.\n\nTrade receivables as of March 31, 2025 and 2026 consist of the following:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n \n\n2026\n\n \n\nTrade accounts and notes receivable\n\n  \n¥\n894,214\n \n \n¥\n922,805\n \n\nOther\n\n  \n \n275,099\n \n \n \n356,409\n \n\nAllowance for impairment losses\n\n  \n \n(8,466\n) \n \n \n(8,738\n)\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n1,160,847\n \n \n¥\n1,270,476\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nThe changes in the allowance for impairment losses on trade receivables for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2024\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nBalance at beginning of year\n\n  \n¥\n8,620\n \n \n¥\n8,402\n \n \n¥\n8,466\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nRemeasurement\n\n  \n¥\n274\n \n \n¥\n490\n \n \n¥\n75\n \n\nWrite-offs\n\n  \n \n(1,114\n) \n \n \n(133\n) \n \n \n(492\n)\n \n\nExchange differences on translating foreign operations\n\n  \n \n622\n \n \n \n(293\n) \n \n \n689\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance at end of year\n\n  \n¥\n8,402\n \n \n¥\n8,466\n \n \n¥\n8,738\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n(7) Receivables from Financial Services\n\nThe finance subsidiaries of the Company provide various financial services to customers and dealers in order to support the sale of products. These receivables from financial services are categorized as follows:\n\nConsumer finance receivables:\n\nRetail receivables primarily consist of receivables from installment contracts with customers.\n\nFinance lease receivables primarily consist of receivables from\nnon-cancelable\nauto leases with customers.\n\nDealer finance receivables:\n\nWholesale receivables primarily consist of financing receivables from dealers for the purchase of inventories and dealer loans.\n\nReceivables from financial services are mainly classified into financial assets measured at amortized cost.\n\n \n\nF-33\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nReceivables from financial services as of March 31, 2025 and 2026 consist of the following:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n \n\n2026\n\n \n\nConsumer finance receivables:\n\n  \n\n \n\nRetail\n\n  \n¥\n8,034,504\n \n \n¥\n8,903,853\n \n\nFinance lease\n\n  \n \n253,559\n \n \n \n269,310\n \n\nDealer finance receivables:\n\n  \n\n \n\nWholesale\n\n  \n \n746,066\n \n \n \n855,798\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nSubtotal\n\n  \n¥\n9,034,129\n \n \n¥\n10,028,961\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nAllowance for credit losses\n\n  \n¥\n(82,125\n) \n \n¥\n(108,374\n)\n\nUnearned interest income and fees\n\n  \n \n(23,387\n) \n \n \n(22,456\n)\n \n\nOther\n\n \n\n \n\n—\n\n \n\n \n\n \n\n(4,635\n\n)\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n8,928,617\n \n \n¥\n9,893,496\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCurrent assets\n\n  \n¥\n2,755,800\n \n \n¥\n3,057,235\n \n\nNon-current\nassets\n\n  \n \n6,172,817\n \n \n \n6,836,261\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n8,928,617\n \n \n¥\n9,893,496\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nFinance lease receivables\n\nThe lease payments receivable under the finance leases by maturity as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n \n\n2026\n\n \n\nWithin 1 year\n\n  \n¥\n40,726\n \n \n¥\n47,904\n \n\nBetween 1 and 2 years\n\n  \n \n46,851\n \n \n \n40,601\n \n\nBetween 2 and 3 years\n\n  \n \n25,814\n \n \n \n38,902\n \n\nBetween 3 and 4 years\n\n  \n \n18,542\n \n \n \n19,724\n \n\nBetween 4 and 5 years\n\n  \n \n6,600\n \n \n \n7,187\n \n\nLater than 5 years\n\n  \n \n9,646\n \n \n \n10,191\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nUndiscounted lease payments receivable\n\n  \n¥\n148,179\n \n \n¥\n164,509\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nUnearned finance income\n\n  \n¥\n(11,623\n) \n \n¥\n(13,732\n)\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nUnguaranteed residual value\n\n  \n¥\n93,616\n \n \n¥\n96,077\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet investment in the lease\n\n  \n¥\n230,172\n \n \n¥\n246,854\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nFor the nature of the lessor’s leasing activities and the risk management strategy, see note 3(i) and (j).\n\n \n\nF-34\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nAllowance for credit losses\n\nThe changes in the allowance for credit losses on receivables from financial services for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\nFor the years ended March 31, 2024, 2025 and 2026\n\n \n\n \n\n \n\nYen (millions)\n\n \n\n \n\n \n\n12-month ECL\n\n(Stage 1)\n\n \n\n \n\nLifetime ECL\n\n \n\n \n\nTotal\n\n \n\n \n\n \n\nNot\n\ncredit-impaired\n\n(Stage 2)\n\n \n\n \n\nCredit-impaired\n\n(Stage 3)\n\n \n\nRetail:\n\n \n\n \n\n \n\n \n\nBalance as of April 1, 2023\n\n \n¥\n26,467\n \n \n¥\n11,072\n \n \n¥\n8,544\n \n \n¥\n46,083\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nRemeasurement\n\n \n¥\n6,823\n \n \n¥\n1,732\n \n \n¥\n40,899\n \n \n¥\n49,454\n \n\nWrite-offs\n\n \n \n— \n \n \n \n— \n \n \n \n(36,663\n) \n \n \n(36,663\n) \n\nExchange differences on translating foreign operations\n\n \n \n3,849\n \n \n \n1,474\n \n \n \n1,282\n \n \n \n6,605\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2024\n\n \n¥\n37,139\n \n \n¥\n14,278\n \n \n¥\n14,062\n \n \n¥\n65,479\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nRemeasurement\n\n \n¥\n5,422\n \n \n¥\n5,695\n \n \n¥\n59,389\n \n \n¥\n70,506\n \n\nWrite-offs\n\n \n \n— \n \n \n \n— \n \n \n \n(54,155\n) \n \n \n(54,155\n) \n\nExchange differences on translating foreign operations\n\n \n \n(1,533\n) \n \n \n(484\n) \n \n \n(1,363\n) \n \n \n(3,380\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n \n¥\n41,028\n \n \n¥\n19,489\n \n \n¥\n17,933\n \n \n¥\n78,450\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nRemeasurement\n\n \n¥\n7,039\n \n \n¥\n2,928\n \n \n¥\n74,444\n \n \n¥\n84,411\n \n\nWrite-offs\n\n \n \n—\n \n \n \n—\n \n \n \n(67,409\n)\n \n \n(67,409\n)\n\nExchange differences on translating foreign operations\n\n \n \n4,174\n \n \n \n1,801\n \n \n \n2,951\n \n \n \n8,926\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n \n¥\n52,241\n \n \n¥\n24,218\n \n \n¥\n27,919\n \n \n¥\n104,378\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nFinance lease:\n\n \n\n \n\n \n\n \n\nBalance as of April 1, 2023\n\n \n¥\n192\n \n \n¥\n69\n \n \n¥\n204\n \n \n¥\n465\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nRemeasurement\n\n \n¥\n46\n \n \n¥\n15\n \n \n¥\n16\n \n \n¥\n77\n \n\nWrite-offs\n\n \n \n— \n \n \n \n— \n \n \n \n(43\n) \n \n \n(43\n) \n\nExchange differences on translating foreign operations\n\n \n \n17\n \n \n \n10\n \n \n \n29\n \n \n \n56\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2024\n\n \n¥\n255\n \n \n¥\n94\n \n \n¥\n206\n \n \n¥\n555\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nRemeasurement\n\n \n¥\n(79\n) \n \n¥\n105\n \n \n¥\n132\n \n \n¥\n158\n \n\nWrite-offs\n\n \n \n— \n \n \n \n— \n \n \n \n(29\n) \n \n \n(29\n) \n\nExchange differences on translating foreign operations\n\n \n \n1\n \n \n \n(1\n) \n \n \n3\n \n \n \n3\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n \n¥\n177\n \n \n¥\n198\n \n \n¥\n312\n \n \n¥\n687\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nRemeasurement\n\n \n¥\n52\n \n \n¥\n(14\n)\n \n¥\n211\n \n \n¥\n249\n \n\nWrite-offs\n\n \n \n—\n \n \n \n—\n \n \n \n(189\n)\n \n \n(189\n)\n\nExchange differences on translating foreign operations\n\n \n \n13\n \n \n \n16\n \n \n \n20\n \n \n \n49\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n \n¥\n242\n \n \n¥\n200\n \n \n¥\n354\n \n \n¥\n796\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nF-35\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n \n\nYen (millions)\n\n \n\n \n\n \n\n12-month ECL\n\n(Stage 1)\n\n \n\n \n\nLifetime ECL\n\n \n\n \n\nTotal\n\n \n\n \n\n \n\nNot\n\ncredit-impaired\n\n(Stage 2)\n\n \n\n \n\nCredit-impaired\n\n(Stage 3)\n\n \n\nWholesale:\n\n \n\n \n\n \n\n \n\nBalance as of April 1, 2023\n\n \n¥\n976\n \n \n¥\n10\n \n \n¥\n1,118\n \n \n¥\n2,104\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nRemeasurement\n\n \n¥\n377\n \n \n¥\n49\n \n \n¥\n100\n \n \n¥\n526\n \n\nWrite-offs\n\n \n \n— \n \n \n \n— \n \n \n \n6\n \n \n \n6\n \n\nExchange differences on translating foreign operations\n\n \n \n149\n \n \n \n3\n \n \n \n177\n \n \n \n329\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2024\n\n \n¥\n1,502\n \n \n¥\n62\n \n \n¥\n1,401\n \n \n¥\n2,965\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nRemeasurement\n\n \n¥\n172\n \n \n¥\n(27\n) \n \n¥\n154\n \n \n¥\n299\n \n\nWrite-offs\n\n \n \n—\n \n \n \n— \n \n \n \n(82\n) \n \n \n(82\n) \n\nExchange differences on translating foreign operations\n\n \n \n(6\n) \n \n \n— \n \n \n \n(188\n) \n \n \n(194\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n \n¥\n1,668\n \n \n¥\n35\n \n \n¥\n1,285\n \n \n¥\n2,988\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nRemeasurement\n\n \n¥\n164\n \n \n¥\n(15\n)\n \n¥\n(249\n)\n \n¥\n(100\n)\n\nWrite-offs\n\n \n \n—\n \n \n \n—\n \n \n \n(45\n)\n \n \n(45\n)\n\nExchange differences on translating foreign operations\n\n \n \n161\n \n \n \n\n4\n\n \n \n \n192\n \n \n \n357\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n \n¥\n1,993\n \n \n¥\n24\n \n \n¥\n1,183\n \n \n¥\n3,200\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal:\n\n \n\n \n\n \n\n \n\nBalance as of April 1, 2023\n\n \n¥\n27,635\n \n \n¥\n11,151\n \n \n¥\n9,866\n \n \n¥\n48,652\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nRemeasurement\n\n \n¥\n7,246\n \n \n¥\n1,796\n \n \n¥\n41,015\n \n \n¥\n50,057\n \n\nWrite-offs\n\n \n \n—\n \n \n \n—\n \n \n \n(36,700\n) \n \n \n(36,700\n) \n\nExchange differences on translating foreign operations\n\n \n \n4,015\n \n \n \n1,487\n \n \n \n1,488\n \n \n \n6,990\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2024\n\n \n¥\n38,896\n \n \n¥\n14,434\n \n \n¥\n15,669\n \n \n¥\n68,999\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nRemeasurement\n\n \n¥\n5,515\n \n \n¥\n5,773\n \n \n¥\n59,675\n \n \n¥\n70,963\n \n\nWrite-offs\n\n \n \n— \n \n \n \n— \n \n \n \n(54,266\n) \n \n \n(54,266\n) \n\nExchange differences on translating foreign operations\n\n \n \n(1,538\n) \n \n \n(485\n) \n \n \n(1,548\n) \n \n \n(3,571\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n \n¥\n42,873\n \n \n¥\n19,722\n \n \n¥\n19,530\n \n \n¥\n82,125\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nRemeasurement\n\n \n¥\n7,255\n \n \n¥\n2,899\n \n \n¥\n74,406\n \n \n¥\n84,560\n \n\nWrite-offs\n\n \n \n—\n \n \n \n—\n \n \n \n(67,643\n)\n \n \n(67,643\n) \n\nExchange differences on translating foreign operations\n\n \n \n4,348\n \n \n \n1,821\n \n \n \n3,163\n \n \n \n9,332\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n \n¥\n54,476\n \n \n¥\n24,442\n \n \n¥\n29,456\n \n \n¥\n108,374\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nFor more information on allowance for credit losses, see note 25(d).\n\n \n\nF-36\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(8) Other Financial Assets\n\nOther financial assets as of March 31, 2025 and 2026 consist of the following:\n\n \n\n \n\n \n\nYen (millions)\n\n \n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nFinancial assets measured at amortized cost:\n\n \n\n \n\nReceivables other than trade receivables and receivables from financial services\n\n \n¥\n120,067\n \n \n¥\n291,627\n \n\nDebt securities\n\n \n \n84,018\n \n \n \n41,564\n \n\nGuaranty deposits\n\n \n \n15,297\n \n \n \n 15,837\n \n\nRestricted cash\n\n \n \n117,260\n \n \n \n112,937\n \n\nOther\n\n \n \n11,063\n \n \n \n8,523\n \n\nAllowance for impairment losses\n\n \n \n(2,513\n) \n \n \n(2,409\n)\n \n\nFinancial assets measured at fair value through other comprehensive income:\n\n \n\n \n\nDebt securities\n\n \n \n34,872\n \n \n \n31,920\n \n\nEquity securities\n\n \n \n434,592\n \n \n \n633,875\n \n\nFinancial assets measured at fair value through profit or loss:\n\n \n\n \n\nDerivatives\n\n \n \n133,077\n \n \n \n182,244\n \n\nDebt securities\n\n \n \n134,204\n \n \n \n127,834\n \n\nDerivatives to which hedge accounting is applied\n\n \n \n—\n \n \n \n64,541\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n \n¥\n1,081,937\n \n \n¥\n1,508,493\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCurrent assets\n\n \n¥\n208,478\n \n \n¥\n296,974\n \n\nNon-current\nassets\n\n \n \n873,459\n \n \n \n1,211,519\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n \n¥\n1,081,937\n \n \n¥\n1,508,493\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nThe changes in the allowance for impairment losses on other financial assets for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n  2024  \n\n \n\n \n\n  2025  \n\n \n\n \n\n2026\n\n \n\nBalance at beginning of year\n\n  \n¥\n2,988\n \n \n¥\n2,748\n \n \n¥\n2,513\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nRemeasurement\n\n  \n¥\n97\n \n \n¥\n18\n \n \n¥\n178\n \n\nWrite-offs\n\n  \n \n(345\n) \n \n \n(253\n) \n \n \n(284\n)\n \n\nExchange differences on translating foreign operations\n\n  \n \n8\n \n \n \n(0\n) \n \n \n2\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance at end of year\n\n  \n¥\n2,748\n \n \n¥\n2,513\n \n \n¥\n2,409\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nThe allowance for impairment losses on other financial assets for the years ended March 31, 2024, 2025 and 2026 are mainly for credit-impaired financial assets.\n\n \n\nF-37\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nMajor securities included in the equity securities designated as financial assets measured at fair value through other comprehensive income as of March 31, 2025 and 2026 are as follows:\n\nAs of March 31, 2025\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\nFair value\n\n \n\nContemporary Amperex Technology Co., Ltd.\n\n  \n¥\n215,612\n \n\nStanley Electric Co., Ltd.\n\n  \n \n46,951\n \n\nRenesas Electronics Corporation\n\n  \n \n35,083\n \n\nNIKKON Holdings Co., Ltd.\n\n  \n \n13,186\n \n\nGS Yuasa Corporation\n\n  \n \n11,711\n \n\nChubb Limited\n\n  \n \n11,703\n \n\nAs of March 31, 2026\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\nFair value\n\n \n\nContemporary Amperex Technology Co., Ltd.\n\n  \n¥\n384,328\n \n\nStanley Electric Co., Ltd.\n\n  \n \n47,846\n \n\nRenesas Electronics Corporation\n\n  \n \n37,978\n \n\nGS Yuasa Corporation\n\n  \n \n25,940\n \n\nNIKKON Holdings Co., Ltd.\n\n  \n \n20,832\n \n\nChubb Limited\n\n  \n \n13,506\n \n\nHonda sells (derecognizes) the equity securities designated as financial assets measured at fair value through other comprehensive income for the purpose of improving efficiency in the utilization of resources and reviewing trade relationships, among other reasons.\n\nThe fair values at the date of derecognition and cumulative net gains or losses recognized in other comprehensive income in equity for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2024\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nFair value\n\n  \n¥\n2,452\n \n \n¥\n61,586\n \n \n¥\n36,911\n \n\nCumulative net gain or loss\n\n  \n¥\n(527\n) \n \n¥\n(55,090\n) \n \n¥\n26,292\n \n\n(9) Inventories\n\nInventories as of March 31, 2025 and 2026 consist of the following:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nFinished goods\n\n  \n¥\n1,582,755\n \n  \n¥\n1,585,283\n \n\nWork in process\n\n  \n \n80,730\n \n  \n \n91,558\n \n\nRaw materials\n\n  \n \n807,105\n \n  \n \n854,325\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n2,470,590\n \n  \n¥\n2,531,166\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nThe amounts of write-down of inventories recognized as an expense for the years ended March 31, 2024, 2025 and 2026 are ¥12,220 million, ¥120,919 million and ¥\n\n49,804\n\nmillion, respectively.\n\n \n\nF-38\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(10) Investments accounted for using the equity method\n\nHonda’s equity in affiliates and joint ventures as of March 31, 2025 and 2026 is as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nInvestments accounted for using the equity method:\n\n  \n\n  \n\nAffiliates\n\n  \n¥\n854,536\n \n  \n¥\n836,276\n \n\nJoint ventures\n\n  \n \n388,078\n \n  \n \n291,842\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n1,242,614\n \n  \n¥\n1,128,118\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nFor the year ended March 31, 2026, the Company performed impairment test for investments accounted for using the equity method related to a certain joint venture in China because there was objective evidence of impairment due to a significant deterioration of profitability for the year ended March 31, 2026, resulting from intensified competition in China. The Company recognized impairment losses of ¥90,882 million for the year ended March 31, 2026 to the recoverable amounts based on the value in use derived from updated business forecasts. The impairment losses are included in share of profit (loss) of investments accounted for using the equity method in the consolidated statements of income and included in Automobile business. The business plan used reflects management’s best estimate. However, changes in assumptions may affect future recoverable amounts and impairment losses.\n\nFor the years ended March 31, 2024 and 2025, the Company did not recognize any significant impairment losses.\n\nHonda’s share of comprehensive income of affiliates and joint ventures for the years ended March 31, 2024, 2025 and 2026 is as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2024\n\n \n\n  \n\n2025\n\n \n\n \n\n2026\n\n \n\nProfit for the year:\n\n  \n\n  \n\n \n\nAffiliates\n\n  \n¥\n26,490\n \n  \n¥\n15,838\n \n \n¥\n(17,014\n)\n\nJoint ventures\n\n  \n \n84,327\n \n  \n \n(14,856\n) \n \n \n(145,066\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n110,817\n \n  \n¥\n982\n \n \n¥\n(162,080\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nOther comprehensive income:\n\n  \n\n  \n\n \n\nAffiliates\n\n  \n¥\n31,797\n \n  \n¥\n18,305\n \n \n¥\n24,471\n \n\nJoint ventures\n\n  \n \n30,856\n \n  \n \n(6,403\n) \n \n \n38,956\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n62,653\n \n  \n¥\n11,902\n \n \n¥\n63,427\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nComprehensive income for the year:\n\n  \n\n  \n\n \n\nAffiliates\n\n  \n¥\n58,287\n \n  \n¥\n34,143\n \n \n¥\n7,457\n \n\nJoint ventures\n\n  \n \n115,183\n \n  \n \n(21,259\n) \n \n \n(106,110\n)\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n173,470\n \n  \n¥\n12,884\n \n \n¥\n(98,653\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nF-39\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nCombined financial information in respect of affiliates as of March 31, 2025 and 2026, and for the years ended March 31, 2024, 2025 and 2026 is as follows:\n\n \n\n \n  \n\nYen (millions)\n\n \n\nFor the year ended March 31, 2024\n\n  \n\nMotorcycle\nBusiness\n\n \n  \n\nAutomobile\nBusiness\n\n \n  \n\nPower Products\nand Other\nBusinesses\n\n \n  \n\nTotal\n\n \n\nSales revenue\n\n  \n¥\n178,964\n \n  \n¥\n4,425,320\n \n  \n¥\n10,335\n \n  \n¥\n4,614,619\n \n\nProfit for the year\n\n  \n \n12,744\n \n  \n \n38,348\n \n  \n \n2,193\n \n  \n \n53,285\n \n\n \n\n \n  \n\nYen (millions)\n\n \n\nAs of and for the year ended March 31, 2025\n\n  \n\nMotorcycle\nBusiness\n\n \n  \n\nAutomobile\nBusiness\n\n \n  \n\nPower Products\nand Other\nBusinesses\n\n \n  \n\nTotal\n\n \n\nCurrent assets\n\n  \n¥\n46,092\n \n  \n¥\n1,971,257\n \n  \n¥\n32,727\n \n  \n¥\n2,050,076\n \n\nNon-current\nassets\n\n  \n \n18,217\n \n  \n \n2,770,810\n \n  \n \n24,559\n \n  \n \n2,813,586\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal assets\n\n  \n \n64,309\n \n  \n \n4,742,067\n \n  \n \n57,286\n \n  \n \n4,863,662\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nCurrent liabilities\n\n  \n \n19,386\n \n  \n \n1,549,786\n \n  \n \n6,630\n \n  \n \n1,575,802\n \n\nNon-current\nliabilities\n\n  \n \n1,919\n \n  \n \n499,907\n \n  \n \n541\n \n  \n \n502,367\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal liabilities\n\n  \n \n21,305\n \n  \n \n2,049,693\n \n  \n \n7,171\n \n  \n \n2,078,169\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal equity\n\n  \n¥\n43,004\n \n  \n¥\n2,692,374\n \n  \n¥\n50,115\n \n  \n¥\n2,785,493\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nSales revenue\n\n  \n¥\n153,727\n \n  \n¥\n4,451,855\n \n  \n¥\n17,845\n \n  \n¥\n4,623,427\n \n\nProfit for the year\n\n  \n \n12,978\n \n  \n \n87,996\n \n  \n \n3,047\n \n  \n \n104,021\n \n\n \n\n \n\n  \n\nYen (millions)\n\n \n\nAs of and for the year ended March 31, 2026\n\n  \n\nMotorcycle\nBusiness\n\n \n\n  \n\nAutomobile\nBusiness\n\n \n\n  \n\nPower Products\nand Other\nBusinesses\n\n \n\n  \n\nTotal\n\n \n\nCurrent assets\n\n  \n¥\n59,611\n \n  \n¥\n2,417,433\n \n  \n¥\n28,692\n \n  \n¥\n2,505,736\n \n\nNon-current\nassets\n\n  \n \n21,027\n \n  \n \n2,733,794\n \n  \n \n25,388\n \n  \n \n2,780,209\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal assets\n\n  \n \n80,638\n \n  \n \n5,151,227\n \n  \n \n54,080\n \n  \n \n5,285,945\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nCurrent liabilities\n\n  \n \n23,612\n \n  \n \n1,726,322\n \n  \n \n6,514\n \n  \n \n1,756,448\n \n\nNon-current\nliabilities\n\n  \n \n2,349\n \n  \n \n721,007\n \n  \n \n437\n \n  \n \n723,793\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal liabilities\n\n  \n \n25,961\n \n  \n \n2,447,329\n \n  \n \n6,951\n \n  \n \n2,480,241\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal equity\n\n  \n¥\n54,677\n \n  \n¥\n2,703,898\n \n  \n¥\n47,129\n \n  \n¥\n2,805,704\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nSales revenue\n\n  \n¥\n191,970\n \n  \n¥\n4,334,184\n \n  \n¥\n17,977\n \n  \n¥\n4,544,131\n \n\nProfit for the year\n\n  \n \n17,069\n \n  \n \n10,378\n \n  \n \n1,964\n \n  \n \n29,411\n \n\n \n\nF-40\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nCombined financial information in respect of joint ventures as of March 31, 2025 and 2026, and for the years ended March 31, 2024, 2025 and 2026 is as follows:\n\n \n\n \n  \n\nYen (millions)\n\n \n\nFor the year ended March 31, 2024\n\n  \n\nMotorcycle\nBusiness\n\n \n  \n\nAutomobile\nBusiness\n\n \n  \n\nPower Products\nand Other\nBusinesses\n\n \n  \n\nTotal\n\n \n\nSales revenue\n\n  \n¥\n1,103,578\n \n  \n¥\n4,003,276\n \n  \n¥\n4,183\n \n  \n¥\n5,111,037\n \n\nProfit for the year\n\n  \n \n100,242\n \n  \n \n67,056\n \n  \n \n1,674\n \n  \n \n168,972\n \n\n \n\n \n\n  \n\nYen (millions)\n\n \n\nAs of and for the year ended March 31, 2025\n\n  \n\nMotorcycle\nBusiness\n\n \n\n  \n\nAutomobile\nBusiness\n\n \n\n \n\nPower Products\nand Other\nBusinesses\n\n \n\n  \n\nTotal\n\n \n\nCurrent assets\n\n  \n¥\n383,566\n \n  \n¥\n919,732\n \n \n¥\n4,892\n \n  \n¥\n1,308,190\n \n\nNon-current\nassets\n\n  \n \n185,883\n \n  \n \n631,036\n \n \n \n1,153\n \n  \n \n818,072\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal assets\n\n  \n \n569,449\n \n  \n \n1,550,768\n \n \n \n6,045\n \n  \n \n2,126,262\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nCurrent liabilities\n\n  \n \n326,185\n \n  \n \n874,653\n \n \n \n2,119\n \n  \n \n1,202,957\n \n\nNon-current\nliabilities\n\n  \n \n71,439\n \n  \n \n78,792\n \n \n \n3,266\n \n  \n \n153,497\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal liabilities\n\n  \n \n397,624\n \n  \n \n953,445\n \n \n \n5,385\n \n  \n \n1,356,454\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal equity\n\n  \n¥\n171,825\n \n  \n¥\n597,323\n \n \n¥\n660\n \n  \n¥\n769,808\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nSales revenue\n\n  \n¥\n1,181,238\n \n  \n¥\n2,723,204\n \n \n¥\n4,943\n \n  \n¥\n3,909,385\n \n\nProfit for the year\n\n  \n \n108,842\n \n  \n \n(139,636\n) \n \n \n1,398\n \n  \n \n(29,396\n) \n\n \n\n \n\n  \n\nYen (millions)\n\n \n\nAs of and for the year ended March 31, 2026\n\n  \n\nMotorcycle\nBusiness\n\n \n\n  \n\nAutomobile\nBusiness\n\n \n\n \n\nPower Products\nand Other\nBusinesses\n\n \n\n  \n\nTotal\n\n \n\nCurrent assets\n\n  \n¥\n423,037\n \n  \n¥\n930,195\n \n  \n¥\n3,778\n \n  \n¥\n1,357,010\n \n\nNon-current\nassets\n\n  \n \n182,897\n \n  \n \n551,504\n \n  \n \n1,262\n \n  \n \n735,663\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal assets\n\n  \n \n605,934\n \n  \n \n1,481,699\n \n  \n \n5,040\n \n  \n \n2,092,673\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nCurrent liabilities\n\n  \n \n371,144\n \n  \n \n852,346\n \n  \n \n832\n \n  \n \n1,224,322\n \n\nNon-current\nliabilities\n\n  \n \n68,951\n \n  \n \n71,904\n \n  \n \n3,557\n \n  \n \n144,412\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal liabilities\n\n  \n \n440,095\n \n  \n \n924,250\n \n  \n \n4,389\n \n  \n \n1,368,734\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal equity\n\n  \n¥\n165,839\n \n  \n¥\n557,449\n \n  \n¥\n651\n \n  \n¥\n723,939\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nSales revenue\n\n  \n¥\n1,226,487\n \n  \n¥\n1,902,570\n \n  \n¥\n5,828\n \n  \n¥\n3,134,885\n \n\nProfit for the year\n\n  \n \n119,253\n \n  \n \n(229,264\n) \n  \n \n1,345\n \n  \n \n(108,666\n) \n\n \n\nF-41\n\n[Table of Contents](#toc)\n\nHONDA\nMOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(11) Equipment on Operating Leases\n\nEquipment on operating leases are mainly vehicles.\n\nThe changes in cost, accumulated depreciation and impairment losses, and the carrying amounts of equipment on operating leases for the years ended March 31, 2025 and 2026 are as follows:\n\n(Cost)\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\nBalance as of April 1, 2024\n\n  \n¥\n6,678,707\n \n\n  \n\n \n\n \n\n \n\nAdditions\n\n  \n¥\n3,134,025\n \n\nSales or disposal\n\n  \n \n(2,608,962\n) \n\nExchange differences on translating foreign operations\n\n  \n \n(112,651\n) \n\nOther\n\n  \n \n— \n \n\n  \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n  \n¥\n7,091,119\n \n\n  \n\n \n\n \n\n \n\nAdditions\n\n  \n¥\n2,764,248\n \n\nSales or disposal\n\n  \n \n(2,211,986\n)\n\nExchange differences on translating foreign operations\n\n  \n \n436,078\n \n\nOther\n\n  \n \n— \n \n\n  \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n  \n¥\n8,079,459\n \n\n  \n\n \n\n \n\n \n\n(Accumulated depreciation and impairment losses)\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\nBalance as of April 1, 2024\n\n  \n¥\n(1,475,939\n) \n\n  \n\n \n\n \n\n \n\nDepreciation\n\n  \n¥\n(876,860\n) \n\nSales or disposal\n\n  \n \n1,020,755\n \n\nExchange differences on translating foreign operations\n\n  \n \n21,499\n \n\nOther\n\n  \n \n(32,387\n) \n\n  \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n  \n¥\n(1,342,932\n) \n\n  \n\n \n\n \n\n \n\nDepreciation\n\n  \n¥\n(954,102\n)\n\nSales or disposal\n\n  \n \n815,485\n \n\nExchange differences on translating foreign operations\n\n  \n \n(78,931\n)\n\nOther*\n\n  \n \n(85,186\n)\n\n  \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n  \n¥\n(1,645,666\n)\n\n  \n\n \n\n \n\n \n\n \n\nExplanatory note:\n\n \n\n*\n\nOther for the year ended March 31, 2026 includes impairment losses on leased electric vehicles, mainly due to declines in estimated end of term residual values.\n\n(Carrying amount)\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\nBalance as of March 31, 2025\n\n  \n¥\n5,748,187\n \n\nBalance as of March 31, 2026\n\n  \n \n6,433,793\n \n\n \n\n \n\nF-42\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(Future lease payments)\n\nFuture lease payments expected to be received under the operating leases by maturity as of March 31, 2025 and 2026 consist of the following:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nWithin 1 year\n\n  \n¥\n966,028\n \n  \n¥\n1,071,460\n \n\nBetween 1 and 2 years\n\n  \n \n741,093\n \n  \n \n771,480\n \n\nBetween 2 and 3 years\n\n  \n \n364,347\n \n  \n \n369,762\n \n\nBetween 3 and 4 years\n\n  \n \n114,240\n \n  \n \n115,901\n \n\nBetween 4 and 5 years\n\n  \n \n32,341\n \n  \n \n34,209\n \n\nLater than 5 years\n\n  \n \n12,540\n \n  \n \n12,061\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n2,230,589\n \n  \n¥\n2,374,873\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nFuture lease payments expected to be received as shown above should not necessarily be considered indicative of future cash collections.\n\n(Lease income)\n\nOperating leases income for the years ended March 31, 2025 and 2026 are ¥1,256,945 million and ¥1,383,758 million, respectively.\n\n(12) Property, Plant and Equipment\n\nThe changes in cost, accumulated depreciation and impairment losses, and the carrying amounts of property, plant and equipment for the years ended March 31, 2025 and 2026 are as follows:\n\n(Cost)\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\nLand\n\n \n\n \n\nBuildings and\nstructures\n\n \n\n \n\nMachinery and\nequipment\n\n \n\n \n\nConstruction in\nprogress\n\n \n\n \n\nTotal\n\n \n\nBalance as of April 1, 2024\n\n  \n¥\n674,562\n \n \n¥\n2,954,398\n \n \n¥\n7,156,049\n \n \n¥\n219,879\n \n \n¥\n11,004,888\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nAdditions\n\n  \n \n14,867\n \n \n \n36,761\n \n \n \n98,025\n \n \n \n463,013\n \n \n \n612,666\n \n\nReclassification\n\n  \n \n3,336\n \n \n \n84,185\n \n \n \n292,186\n \n \n \n(379,707\n) \n \n \n— \n \n\nSales or disposal\n\n  \n \n(9,128\n) \n \n \n(39,708\n) \n \n \n(295,604\n) \n \n \n— \n \n \n \n(344,440\n) \n\nExchange differences on translating foreign operations\n\n  \n \n(2,385\n) \n \n \n(26,961\n) \n \n \n(117,006\n) \n \n \n(5,476\n) \n \n \n(151,828\n) \n\nOther\n\n  \n \n6\n \n \n \n(3,179\n) \n \n \n(2,949\n) \n \n \n(2,128\n) \n \n \n(8,250\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n  \n¥\n681,258\n \n \n¥\n3,005,496\n \n \n¥\n7,130,701\n \n \n¥\n295,581\n \n \n¥\n11,113,036\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nAdditions\n\n  \n \n8,500\n \n \n \n44,656\n \n \n \n80,698\n \n \n \n704,589\n \n \n \n838,443\n \n\nReclassification\n\n  \n \n4,372\n \n \n \n84,869\n \n \n \n239,373\n \n \n \n(328,614\n)\n \n \n —\n\nSales or disposal\n\n  \n \n(3,414\n)\n \n \n(100,687\n)\n \n \n(356,226\n)\n \n \n(3,173\n)\n \n \n(463,500\n)\n\nTransfers to assets held for sale\n\n  \n \n(16,578\n) \n \n \n(43,796\n) \n \n \n(164,120\n) \n \n \n(1,016\n) \n \n \n(225,510\n) \n\nExchange differences on translating foreign operations\n\n  \n \n14,813\n \n \n \n128,530\n \n \n \n405,163\n \n \n \n28,978\n \n \n \n577,484\n \n\nOther\n\n  \n \n154\n \n \n \n(916\n)\n \n \n(7,179\n)\n \n \n(4,128\n)\n \n \n(12,069\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n  \n¥\n689,105\n \n \n¥\n3,118,152\n \n \n¥\n7,328,410\n \n \n¥\n692,217\n \n \n¥\n11,827,884\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nF-43\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(Accumulated depreciation and impairment losses)\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\nLand\n\n \n\n \n\nBuildings and\nstructures\n\n \n\n \n\nMachinery and\nequipment\n\n \n\n \n\nConstruction in\nprogress\n\n \n\n \n\nTotal\n\n \n\nBalance as of April 1, 2024\n\n  \n¥\n(25,442\n) \n \n¥\n(1,845,450\n) \n \n¥\n(5,899,182\n) \n \n¥\n(401\n) \n \n¥\n(7,770,475\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nDepreciation\n\n  \n \n(6,399\n) \n \n \n(106,045\n) \n \n \n(419,365\n) \n \n \n— \n \n \n \n(531,809\n) \n\nSales or disposal\n\n  \n \n3,372\n \n \n \n34,386\n \n \n \n263,760\n \n \n \n— \n \n \n \n301,518\n \n\nExchange differences on translating foreign operations\n\n  \n \n44\n \n \n \n15,566\n \n \n \n95,475\n \n \n \n— \n \n \n \n111,085\n \n\nOther\n\n  \n \n(355\n) \n \n \n(2,909\n) \n \n \n(10,132\n) \n \n \n(38\n)\n \n \n(13,434\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n  \n¥\n(28,780\n) \n \n¥\n(1,904,452\n) \n \n¥\n(5,969,444\n) \n \n¥\n  (439\n)\n \n¥\n(7,903,115\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nDepreciation\n\n  \n \n(6,988\n)\n \n \n(108,060\n)\n \n \n(372,605\n)\n \n \n— \n \n \n \n(487,653\n)\n\nImpairment losses...\n\n  \n \n(291\n) \n \n \n(530\n) \n \n \n(27,463\n) \n \n \n(373,838\n)\n \n \n(402,122\n) \n\nSales or disposal\n\n  \n \n1,365\n \n \n \n95,110\n \n \n \n322,206\n \n \n \n— \n \n \n \n418,681\n \n\nTransfers to assets held for sale\n\n  \n \n1,447\n \n \n \n30,728\n \n \n \n146,497\n \n \n \n—\n \n \n \n178,672\n \n\nExchange differences on translating foreign operations\n\n  \n \n(473\n)\n \n \n(80,152\n)\n \n \n(348,101\n)\n \n \n(7,107\n)\n \n \n(435,833\n)\n\nOther\n\n  \n \n(211\n)\n \n \n244\n \n \n \n(201\n)\n \n \n36\n \n \n \n(132\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n  \n¥\n(33,931\n)\n \n¥\n(1,967,112\n)\n \n¥\n(6,249,111\n)\n \n¥\n(381,348\n)\n \n¥\n(8,631,502\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n(Carrying amount)\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\nLand\n\n \n\n  \n\nBuildings and\nstructures\n\n \n\n  \n\nMachinery and\nequipment\n\n \n\n  \n\nConstruction in\nprogress\n\n \n\n  \n\nTotal\n\n \n\nBalance as of March 31, 2025\n\n  \n¥\n652,478\n \n  \n¥\n1,101,044\n \n  \n¥\n1,161,257\n \n  \n¥\n295,142\n \n  \n¥\n3,209,921\n \n\nBalance as of March 31, 2026\n\n  \n \n655,174\n \n  \n \n1,151,040\n \n  \n \n1,079,299\n \n  \n \n310,869\n \n  \n \n3,196,382\n \n\nFor commitments for purchases of property, plant and equipment, see note 28.\n\nFor the details of EV-related impairment losses, see note 4(d).\n\n(Right-of-use\n\nAssets)\n\nProperty, plant and equipment in the consolidated statements of financial position includes the\n\nright-of-use\n\nassets under lease arrangements, which are mainly included in Automobile business.\n\nHonda leases mainly dealer’s stores, company housing and parking lots, under arrangements that often contain extension and termination options. Since lease contracts are managed at each company and individually negotiated, the lease contracts include various terms. Extension and termination options are included mainly in order to enhance operational flexibly of each company.\n\n \n\nF-44\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nThe changes in the carrying amounts of the\n\nright-of-use\n\nassets for the years ended March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\nLand\n\n \n\n \n\nBuildings and\nstructures\n\n \n\n \n\nMachinery and\nequipment\n\n \n\n \n\nTotal\n\n \n\nBalance as of April 1, 2024\n\n  \n¥\n91,186\n \n \n¥\n137,598\n \n \n¥\n94,227\n \n \n¥\n323,011\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nAdditions\n\n  \n \n5,689\n \n \n \n33,006\n \n \n \n36,544\n \n \n \n75,239\n \n\nDepreciation\n\n  \n \n(6,399\n) \n \n \n(19,110\n) \n \n \n(50,115\n) \n \n \n(75,624\n) \n\nOther\n\n  \n \n(3,839\n) \n \n \n(7,669\n) \n \n \n(1,413\n) \n \n \n(12,921\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n  \n¥\n86,637\n \n \n¥\n143,825\n \n \n¥\n79,243\n \n \n¥\n309,705\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nAdditions\n\n  \n \n8,500\n \n \n \n38,740\n \n \n \n39,824\n \n \n \n87,064\n \n\nDepreciation\n\n  \n \n(6,988\n)\n \n \n(26,452\n)\n \n \n(43,927\n)\n \n \n(77,367\n)\n\nOther\n\n  \n \n1,032\n \n \n \n(366\n)\n \n \n(729\n)\n \n \n(63\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n  \n¥\n89,181\n \n \n¥\n155,747\n \n \n¥\n74,411\n \n \n¥\n319,339\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n(13) Intangible Assets\n\nThe changes in cost, accumulated amortization and impairment losses, and carrying amounts of intangible assets for the years ended March 31, 2025 and 2026 are as follows:\n\n(Cost)\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\nCapitalized\ndevelopment costs\n\n \n\n \n\nSoftware\n\n \n\n \n\nOther\n\n \n\n \n\nTotal\n\n \n\nBalance as of April 1, 2024\n\n  \n¥\n1,101,561\n \n \n¥\n597,982\n \n \n¥\n130,629\n \n \n¥\n1,830,172\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nAdditions\n\n  \n¥\n — \n \n \n¥\n20,330\n \n \n¥\n2,153\n \n \n¥\n22,483\n \n\nInternally developed\n\n  \n \n287,098\n \n \n \n55,775\n \n \n \n — \n \n \n \n342,873\n \n\nSales or disposal\n\n  \n \n(50,588\n)\n \n \n(6,880\n)\n \n \n(21,365\n)\n \n \n(78,833\n)\n\nExchange differences on translating foreign operations\n\n  \n \n(793\n)\n \n \n(5,754\n)\n \n \n(2,099\n)\n \n \n(8,646\n) \n\nOther\n\n  \n \n1,616\n \n \n \n5,352\n \n \n \n206\n \n \n \n7,174\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n  \n¥\n1,338,894\n \n \n¥\n666,805\n \n \n¥\n109,524\n \n \n¥\n2,115,223\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nAdditions\n\n  \n¥\n — \n \n \n¥\n26,064\n \n \n¥\n2,931\n \n \n¥\n28,995\n \n\nInternally developed\n\n  \n \n198,806\n \n \n \n61,280\n \n \n \n — \n \n \n \n260,086\n \n\nSales or disposal\n\n  \n \n(539,135\n) \n \n \n(50,744\n) \n \n \n(9,648\n) \n \n \n(599,527\n)\n\nExchange differences on translating foreign operations\n\n  \n \n16,219\n \n \n \n30,460\n \n \n \n9,019\n \n \n \n55,698\n \n\nOther\n\n  \n \n1,756\n \n \n \n(4,245\n)\n \n \n(1,030\n)\n \n \n(3,519\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n  \n¥\n1,016,540\n \n \n¥\n729,620\n \n \n¥\n110,796\n \n \n¥\n1,856,956\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nF-45\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(Accumulated amortization and impairment losses)\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\nCapitalized\ndevelopment costs\n\n \n\n \n\nSoftware\n\n \n\n \n\nOther\n\n \n\n \n\nTotal\n\n \n\nBalance as of April 1, 2024\n\n  \n¥\n(372,370\n) \n \n¥\n(445,892\n) \n \n¥\n(12,221\n) \n \n¥\n(830,483\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nAmortization\n\n  \n¥\n(162,579\n) \n \n¥\n(40,549\n)\n \n¥\n(1,008\n)\n \n¥\n(204,136\n)\n\nSales or disposal\n\n  \n \n37,207\n \n \n \n6,041\n \n \n \n302\n \n \n \n43,550\n \n\nExchange differences on translating foreign operations\n\n  \n \n(39\n) \n \n \n3,650\n \n \n \n168\n \n \n \n3,779\n \n\nOther\n\n  \n \n18\n \n \n \n(124\n)\n \n \n(1,808\n)\n \n \n(1,914\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n  \n¥\n(497,763\n) \n \n¥\n(476,874\n)\n \n¥\n(14,567\n)\n \n¥\n(989,204\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nAmortization\n\n  \n¥\n(165,607\n)\n \n¥\n(40,769\n)\n \n¥\n(2,414\n)\n \n¥\n(208,790\n)\n\nImpairment losses\n\n  \n \n(69,602\n) \n \n \n(217\n)\n \n \n(34,333\n)\n \n \n(104,152\n)\n\nSales or disposal\n\n  \n \n209,740\n \n \n \n45,731\n \n \n \n23\n \n \n \n255,494\n \n\nExchange differences on translating foreign operations\n\n  \n \n(8,758\n)\n \n \n(21,879\n)\n \n \n(2,907\n)\n \n \n(33,544\n)\n\nOther\n\n  \n \n3,498\n \n \n \n2,757\n \n \n \n1,745\n \n \n \n8,000\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n  \n¥\n(528,492\n)\n \n¥\n(491,251\n)\n \n¥\n(52,453\n)\n \n¥\n(1,072,196\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n(Carrying amount)\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\nCapitalized\ndevelopment costs\n\n \n\n  \n\nSoftware\n\n \n\n  \n\nOther\n\n \n\n  \n\nTotal\n\n \n\nBalance as of March 31, 2025\n\n  \n¥\n 841,131\n \n  \n¥\n 189,931\n \n  \n¥\n 94,957\n \n  \n¥\n  1,126,019\n \n\nBalance as of March 31, 2026\n\n  \n \n488,048\n \n  \n \n238,369\n \n  \n \n58,343\n \n  \n \n784,760\n \n\nAmortization, impairment losses and losses on disposal of capitalized development costs is included in research and development, and amortization of other intangible assets is included in cost of sales, selling, general and administrative, and research and development in the consolidated statements of income.\n\nFor commitments for purchases of intangible assets, see note 28.\n\nFor the details of EV-related impairment losses and losses on disposal, see note 4(d).\n\n(14) Trade Payables\n\nTrade payables are classified as financial liabilities measured at amortized cost.\n\nTrade payables as of March 31, 2025 and 2026 consist of the following:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nTrade accounts and notes payable\n\n  \n¥\n1,359,175\n \n  \n¥\n1,438,658\n \n\nOther\n\n  \n \n304,312\n \n  \n \n342,940\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n1,663,487\n \n  \n¥\n1,781,598\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\nF-46\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(15) Financing Liabilities\n\nFinancing liabilities are classified as financial liabilities measured at amortized cost.\n\nFinancing liabilities presented in current liabilities as of March 31, 2025 and 2026 consist of the following:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nCurrent:\n\n  \n\n  \n\nCommercial paper\n\n  \n¥\n1,114,208\n \n  \n¥\n657,136\n \n\nLoans\n\n  \n \n475,728\n \n  \n \n389,253\n \n\nMedium-term notes\n\n  \n \n164,457\n \n  \n \n95,920\n \n\nAsset-backed securities\n\n  \n \n75,511\n \n  \n \n89,255\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nSubtotal\n\n  \n¥\n1,829,904\n \n  \n¥\n1,231,564\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nReclassification from\nnon-current\nliabilities (Current portion)\n\n  \n¥\n2,667,843\n \n  \n¥\n3,773,148\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n4,497,747\n \n  \n¥\n5,004,712\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nThe weighted average interest rates for financing liabilities presented in current liabilities (excluding reclassification from\nnon-current\nliabilities) as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\n2025\n\n \n\n \n\n2026\n\n \n\nWeighted average interest rate\n\n  \n \n4.15\n% \n \n \n3.38\n% \n\nFinancing liabilities presented in\nnon-current\nliabilities as of March 31, 2025 and 2026 consist of the following:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n \n\n2026\n\n \n\nNon-current:\n\n  \n\n \n\nLoans\n\n  \n¥\n984,333\n \n \n¥\n1,321,417\n \n\nMedium-term notes\n\n  \n \n5,900,016\n \n \n \n7,026,249\n \n\nCorporate bonds\n\n  \n \n866,042\n \n \n \n1,439,571\n \n\nAsset-backed securities\n\n  \n \n1,870,972\n \n \n \n2,461,062\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nSubtotal\n\n  \n¥\n9,621,363\n \n \n¥\n12,248,299\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nReclassification to current liabilities (Current portion)\n\n  \n¥\n(2,667,843\n) \n \n¥\n(3,773,148\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n6,953,520\n \n \n¥\n8,475,151\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nF-47\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nThe interest rate range and payment due date for financing liabilities presented in\nnon-current\nliabilities (including reclassification to current liabilities) as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\n2025\n\n  \n\n2026\n\nLoans\n\n  \n\nInterest rate: 0.14% - 13.30%\n\nDue: 2025 - 2046\n\n  \n\nInterest rate: 0.14%  -  11.82%\n\nDue: 2026 - 2046\n\nMedium-term notes\n\n  \n\nInterest rate: 0.30% - 5.85%\n\nDue: 2025 - 2035\n\n  \n\nInterest rate: 0.30%  - \n\n5.85\n\n%\n\nDue: 2026 - 2036\n\nCorporate bonds\n\n  \n\nInterest rate: 0.09% - 2.97%\n\nDue: 2025 - 2032\n\n  \n\nInterest rate: 0.09% -  5.34%\n\nDue: 2026 - 2036\n\nAsset-backed securities\n\n  \n\nInterest rate: 0.11% - 5.87%\n\nDue: 2025 - 2029\n\n  \n\nInterest rate: 0.36% -  5.67%\n\nDue: 2026 - 2030\n\n(Pledged assets)\n\nPledged assets for financing liabilities as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nTrade receivables\n\n  \n¥\n27,365\n \n  \n¥\n28,370\n \n\nReceivables from financial services\n\n  \n \n1,980,042\n \n  \n \n2,631,644\n \n\nInventories\n\n  \n \n1,772\n \n  \n \n1,017\n \n\nEquipment on operating leases\n\n  \n \n92,822\n \n  \n \n99,137\n \n\nProperty, plant and equipment\n\n  \n \n2,779\n \n  \n \n2,773\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n2,104,780\n \n  \n¥\n2,762,941\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nReceivables from financial services and equipment on operating leases are pledged as collateral for liabilities related to asset-backed securities transactions. Other items are mainly pledged as collateral for secured bank loans.\n\nAs is customary in Japan, bank loans are extended under general agreements which provide that security and guarantees for present and future indebtedness will be given upon request of the bank, and that the bank shall have the right to offset cash deposits against obligations that have become due or, in the event of default, against all obligations due to the bank.\n\n \n\nF-4\n8\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(Reconciliation of liabilities arising from financing activities)\n\nThe changes in liabilities arising from financing activities for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\nFor the year ended March 31, 2024\n\n \n\n \n\n \n\nYen (millions)\n\n \n\n \n\n \n\nBalance\nas of\nApril 1,\n2023\n\n \n\n \n\nCash flows\nfrom\nfinancing\nactivities\n\n \n\n \n\nCash flows\nfrom\noperating\nactivities\n\n \n\n \n\nNon-cash\nchanges\n\n \n\n \n\nBalance\nas of\nMarch 31,\n2024\n\n \n\n \n\nAcquisitions\n\n \n\n \n\nChanges\nin foreign\ncurrency\nexchange\nrates\n\n \n\n \n\nChanges\nin fair value\n\n \n\n \n\nOther\n\n \n\nShort-term financing liabilities\n\n \n¥\n1,365,775\n \n \n¥\n(24,382\n) \n \n¥\n— \n \n \n¥\n— \n \n \n¥\n177,888\n \n \n¥\n— \n \n \n¥\n(2,434\n) \n \n¥\n1,516,847\n \n\nLong-term financing liabilities\n\n \n \n6,299,393\n \n \n \n1,593,898\n \n \n \n— \n \n \n \n— \n \n \n \n751,082\n \n \n \n— \n \n \n \n2,337\n \n \n \n8,646,710\n \n\nLease liabilities\n\n \n \n315,958\n \n \n \n(80,513\n) \n \n \n— \n \n \n \n92,612\n \n \n \n9,509\n \n \n \n— \n \n \n \n(5,160\n) \n \n \n332,406\n \n\nDerivative financial liabilities (assets)\n*\n\n \n \n65,276\n \n \n \n4,983\n \n \n \n(36,665\n) \n \n \n  — \n \n \n \n11,112\n \n \n \n(32,957\n) \n \n \n  — \n \n \n \n11,749\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n \n¥\n8,046,402\n \n \n¥\n1,493,986\n \n \n¥\n(36,665\n) \n \n¥\n92,612\n \n \n¥\n949,591\n \n \n¥\n(32,957\n) \n \n¥\n(5,257)\n \n \n¥\n10,507,712\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nFor the year ended March 31, 2025\n\n \n\n \n\n \n\nYen (millions)\n\n \n\n \n\n \n\nBalance\nas of\nApril 1,\n2024\n\n \n\n \n\nCash flows\nfrom\nfinancing\nactivities\n\n \n\n \n\nCash flows\nfrom\noperating\nactivities\n\n \n\n \n\nNon-cash\nchanges\n\n \n\n \n\nBalance\nas of\nMarch 31,\n2025\n\n \n\n \n\nAcquisitions\n\n \n\n \n\nChanges\nin foreign\ncurrency\nexchange\nrates\n\n \n\n \n\nChanges\nin fair value\n\n \n\n \n\nOther\n\n \n\nShort-term financing liabilities\n\n \n¥\n1,516,847\n \n \n¥\n340,693\n \n \n¥\n— \n \n \n¥\n— \n \n \n¥\n(30,130\n) \n \n¥\n— \n \n \n¥\n2,494\n \n \n¥\n1,829,904\n \n\nLong-term financing liabilities\n\n \n \n8,646,710\n \n \n \n1,119,418\n \n \n \n— \n \n \n \n— \n \n \n \n(149,634\n) \n \n \n— \n \n \n \n4,869\n \n \n \n9,621,363\n \n\nLease liabilities\n\n \n \n332,406\n \n \n \n(78,137\n) \n \n \n— \n \n \n \n76,919\n \n \n \n(1,427\n) \n \n \n— \n \n \n \n(6,838\n) \n \n \n322,923\n \n\nDerivative financial liabilities (assets)\n*\n\n \n \n11,749\n \n \n \n31,488\n \n \n \n(35,007\n) \n \n \n  — \n \n \n \n(621\n) \n \n \n2,532\n \n \n \n  — \n \n \n \n10,141\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n \n¥\n10,507,712\n \n \n¥\n1,413,462\n \n \n¥\n(35,007\n) \n \n¥\n76,919\n \n \n¥\n(181,812\n) \n \n¥\n  2,532\n \n \n¥\n525\n \n \n¥\n11,784,331\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nFor the year ended March 31, 2026\n\n \n\n \n\n \n\nYen (millions)\n\n \n\n \n\n \n\nBalance\nas of\nApril 1,\n2025\n\n \n\n \n\nCash flows\nfrom\nfinancing\nactivities\n\n \n\n \n\nCash flows\nfrom\noperating\nactivities\n\n \n\n \n\nNon-cash\nchanges\n\n \n\n \n\nBalance\nas of\nMarch 31,\n2026\n\n \n\n \n\nAcquisitions\n\n \n\n \n\nChanges\nin foreign\ncurrency\nexchange\nrates\n\n \n\n \n\nChanges\nin fair value\n\n \n\n \n\nOther\n\n \n\nShort-term financing liabilities\n\n \n¥\n1,829,904\n \n \n¥\n(685,405\n)\n \n¥\n\n— \n\n \n \n¥\n\n— \n\n \n \n¥\n90,254\n \n \n¥\n— \n \n \n¥\n(3,189\n)\n \n¥\n1,231,564\n \n\nLong-term financing liabilities\n\n \n \n9,621,363\n \n \n \n1,757,609\n \n \n \n  — \n \n \n \n— \n \n \n \n860,734\n \n \n \n— \n \n \n \n8,593\n \n \n \n12,248,299\n \n\nLease liabilities\n\n \n \n322,923\n \n \n \n(80,222\n) \n \n \n  — \n \n \n \n82,789\n \n \n \n6,512\n \n \n \n   — \n \n \n \n(5,058\n) \n \n \n326,944\n \n\nDerivative financial liabilities (assets)\n*\n\n \n \n10,141\n \n \n \n3,960\n \n \n \n(33,225\n) \n \n \n    — \n \n \n \n(567\n) \n \n \n(136,758\n) \n \n \n— \n \n \n \n(156,449\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n \n¥\n11,784,331\n \n \n¥\n \n\n995,942\n \n \n¥ \n(33,225\n)\n \n¥\n82,789\n \n \n¥\n956,933\n \n \n¥\n(136,758\n)\n \n¥\n346\n \n \n¥\n13,650,358\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nF-4\n9\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n \n\nExplanatory note:\n\n \n\n*\n\nDerivative financial liabilities (assets) are held by the Company and its finance subsidiaries to hedge foreign currency risk for principals and interests payment of long-term financing liabilities. The cash flows related to repayments of principals are included in cash flows from financing activities, while the cash flows related to interest paid are included in cash flows from operating activities.\n\n(16) Other Financial Liabilities\n\nOther financial liabilities as of March 31, 2025 and 2026 consist of the following:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n 2026 \n\n \n\nFinancial liabilities measured at amortized cost\n\n  \n¥\n83,747\n \n  \n¥\n131,675\n \n\nFinancial liabilities measured at fair value through profit or loss:\n\n  \n\n  \n\nDerivatives\n\n  \n \n171,630\n \n  \n \n122,477\n \n\nLease liabilities\n\n  \n \n322,923\n \n  \n \n326,944\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n578,300\n \n  \n¥\n581,096\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nCurrent liabilities\n\n  \n¥\n276,861\n \n  \n¥\n264,598\n \n\nNon-current\nliabilities\n\n  \n \n301,439\n \n  \n \n316,498\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n578,300\n \n  \n¥\n581,096\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n(17) Provisions\n\nThe components of and changes in provisions for the year ended March 31, 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\nProduct\nwarranties\n*1\n\n \n\n \n\nEV-related\nlosses\n*2\n\n \n\n \n\nOther\n\n \n\n \n\nTotal\n\n \n\nBalance as of April 1, 2025\n\n \n\n¥\n  858,103\n\n \n\n  \n¥\n  52,199\n \n  \n¥\n  145,413\n \n  \n¥\n  1,055,715\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nAdditional provisions\n\n \n\n¥\n319,613\n\n \n\n  \n¥\n667,366\n \n  \n¥\n68,605\n \n  \n¥\n1,055,584\n \n\nWrite-offs\n\n \n\n \n\n(354,596\n\n)\n \n\n  \n \n(82,954\n)\n \n\n  \n \n(48,734\n)\n  \n \n(486,284\n)\n\nReversal\n\n \n\n \n\n(19,037\n\n)\n\n  \n \n —\n \n  \n \n(18,538\n)\n \n\n  \n \n(37,575\n)\n \n\nOther\n\n \n\n \n\n63,085\n\n \n\n  \n \n10,886\n \n  \n \n22,065\n \n  \n \n96,036\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n \n\n¥\n867,168\n\n \n\n  \n¥\n647,497\n \n  \n¥\n168,811\n \n  \n¥\n1,683,476\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nCurrent liabilities and\nnon-current\nliabilities of provisions as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nCurrent liabilities\n\n  \n¥\n388,441\n \n  \n¥\n948,252\n \n\nNon-current\nliabilities\n\n  \n \n667,274\n \n  \n \n735,224\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n1,055,715\n \n  \n¥\n1,683,476\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\nExplanatory note:\n\n \n\n*1\n\nHonda recognizes provisions for product warranties to cover future product warranty expenses. Honda recognizes costs for general warranties on products Honda sells and for specific warranty programs, including product recalls.\n\n \n\nF-\n5\n\n0\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(i) Honda recognizes general estimated warranty costs at the time products are sold to customers and estimates based on historical warranty claim experience with consideration given to the expected level of future warranty costs, including current sales trends, the expected number of units to be affected and the estimated average repair cost per unit for warranty claims.\n\n(ii) Honda recognizes specific estimated warranty program costs as follows.\n\nHonda accrues the provisions comprehensively for specific warranty programs of automobile products manufactured at our major production bases at the time of vehicle sales.\n\nThe estimated specific warranty costs are measured by the number of units sold over the past fiscal years and specific warranty cost per unit expected to be incurred (specific warranty cost per unit) after vehicle sales over their product life based on our historical experience. Expected specific warranty cost per unit is calculated based on the actual warranty costs incurred over specific range of past periods such as the average useful product life. This estimate is inherently uncertain as it is based on our historical experience as described above. Consequently, the actual specific warranty cost per unit may differ from the expected cost per unit and result in adjustments to the provisions in future reporting periods. The difference from estimated specific warranty cost per unit can be primarily driven by actual repair costs such as parts and labor.\n\nIn addition to the provisions comprehensively accrued, estimates of certain warranty program costs are individually made when it is deemed appropriate by considering its nature and magnitude of each program. Honda recognizes those provisions when it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. The provisions are estimated based on the expected level of future warranty costs, including the expected number of units to be affected and the estimated repair cost per unit for warranty claims.\n\nHonda also accrues the provisions individually for specific warranty programs of our products manufactured at our production bases other than major automobile production bases.\n\nProvisions for (i) and (ii) product warranties are utilized for expenditures based on the demand from customers and dealers. A portion of the product warranties is expected to be reimbursed by agreement with suppliers. The amount of expected reimbursement is ¥116,067 million as of March 31, 2026.\n\n \n\n*2\n\nDue to an increase in quantitative materiality as of the year ended March 31, 2026, provisions for\nEV-related\nlosses which had been included in “Other” as of the year ended March 31, 2025, are presented separately. Accordingly, the balance as of April 1, 2025 has been reclassified.\n\nProvisions for EV-related losses consist of the following:\n\n(i) Provisions for the onerous contract under an alliance agreement Provisions for the onerous contract as of April 1, 2025 and March 31, 2026, are ¥52,199 million and ¥\n\n86,302\n\n million, respectively.\n\nHonda has a long-term supply agreement for EV models jointly developed with an alliance partner. Provisions are recognized and measured as onerous contracts when the unavoidable costs of meeting the obligations under a contract exceed the economic benefits expected to be received under it. For the year ended March 31, 2026, Honda recognized additional provisions of ¥106,296 million for the onerous contract. This increase was primarily driven by a shift in the United States government policy, including the imposition of tariffs, the abolition of tax incentives for EV purchases, and the easing of emissions regulations, as well as a reduction in production volume, which resulted in decreased economic benefits and increased costs. Outflows of resources embodying economic benefits related to these onerous contracts are expected to occur within one year from March 31, 2026.\n\n \n\nF-\n5\n\n1\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(ii) Provisions for losses or expenses arising from contracts entered into with other parties in relation to EV models\n\nThe ending balance of these provisions as of March 31, 2026 is ¥561,195 million.\n\nHonda has entered into various agreements with alliance partners and other suppliers, including contracts for joint development of EV models, procurement of parts, and the supply of EV models. Certain of these contracts contain clauses that require compensation to be paid in the event that minimum purchase quantities are not met or purchase orders are canceled. In connection with these agreements, following the decisions made during the year ended March 31, 2026 to cancel the development and market launch of EV models planned for production in North America, as well as to discontinue production or reduce production volumes of EV models jointly developed under a certain alliance agreement, Honda had initiated discussions with certain alliance partners regarding compensation by March 31, 2026. Provisions are recognized for losses or expenses related to additional payments to suppliers arising from these agreements when it is probable that an outflow of resources embodying economic benefits will be required and when the amount can be reliably estimated. For the year ended March 31, 2026, Honda recognized additional provisions\n\nof ¥561,070 million. These provisions are measured taking into account the status of negotiations, and the timing of outflows of resources embodying economic benefits is subject to change depending on the progress of discussions with other parties and changes in circumstances.\n\nFor commitments with related parties associated with the compensation, see note 30.\n\n \n\nF-52\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(18) Employee Benefits\n\n(a) Post-employment Benefits\n\nHonda has various pension plans covering substantially all of its employees in Japan and certain employees in foreign countries. The Company and its Japanese subsidiaries provide plans similar to a cash balance pension plan or other defined benefit pension plans in accordance with the Defined-Benefit Corporate Pension Act of Japan. The Company and some of its subsidiaries have retirement pension benefit plans as well as\nlump-sum\nretirement benefit plans, in which the amount of benefits is basically determined based on the level of salary, service years, and other factors. In addition, certain consolidated subsidiaries in North America provide mainly health care and life insurance benefits to retired employees.\n\nThe Company’s pension plans are administered by the Honda Pension Fund (the Fund) which is legally independent of the Company. The Director of the Fund has the fiduciary duty to comply with laws, the directives by the Minister of Health, Labour and Welfare, and the Director-Generals of Regional Bureaus of Health and Welfare made pursuant to those laws, and the\nby-laws\nof the Fund and the decisions made by the Board of Representatives of the Fund. The Company is required to make contributions to the Fund and obligated to make contributions in the amount stipulated by the Fund. Contributions are also regularly reviewed and adjusted as necessary to the extent permitted by laws and regulations.\n\n \n\nF-\n5\n3\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n1) Defined benefit obligations and plan assets\n\nThe changes in present value of defined benefit obligations and fair value of plan assets of the Company and certain of its consolidated subsidiaries for the years ended March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n \n\n2026\n\n \n\n \n\n  \n\nJapanese plans\n\n \n\n \n\nForeign plans\n\n \n\n \n\nJapanese plans\n\n \n\n \n\nForeign plans\n\n \n\nPresent value of defined benefit obligations:\n\n  \n\n \n\n \n\n  \n\nBalance at beginning of year\n\n  \n¥\n1,081,392\n \n \n¥\n1,037,123\n \n \n¥\n980,252\n \n  \n¥\n1,006,596\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nCurrent service cost\n\n  \n \n24,203\n \n \n \n19,077\n \n \n \n21,419\n \n  \n \n19,615\n \n\nInterest cost\n\n  \n \n16,392\n \n \n \n50,717\n \n \n \n21,486\n \n  \n \n50,632\n \n\nPlan participants’ contributions\n\n  \n \n— \n \n \n \n4,022\n \n \n \n — \n \n  \n \n3,841\n \n\nRemeasurements:\n\n  \n\n \n\n \n\n  \n\nChanges in demographic\nassumptions\n\n  \n \n980\n \n \n \n1,982\n \n \n \n(3,235\n)\n  \n \n3,344\n \n\nChanges in financial assumptions\n\n  \n \n(83,744\n) \n \n \n(28,838\n) \n \n \n(79,242\n)\n  \n \n(19,047\n)\n\nOther\n\n  \n \n3,325\n \n \n \n8,516\n \n \n \n(2,132\n)\n  \n \n14,447\n \n\nBenefits paid\n\n  \n \n(62,296\n) \n \n \n(63,038\n) \n \n \n(58,011\n)\n  \n \n(72,880\n)\n\nExchange differences on translating\nforeign operations\n\n  \n \n— \n \n \n \n(22,965\n) \n \n \n — \n \n  \n \n79,598\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nBalance at end of year\n\n  \n¥\n980,252\n \n \n¥\n1,006,596\n \n \n¥\n880,537\n \n  \n¥\n1,086,146\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nFair value of plan assets:\n\n  \n\n \n\n \n\n  \n\nBalance at beginning of year\n\n  \n¥\n1,247,059\n \n \n¥\n993,401\n \n \n¥\n1,199,267\n \n  \n¥\n958,328\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nInterest income\n\n  \n \n19,164\n \n \n \n52,338\n \n \n \n26,657\n \n  \n \n48,176\n \n\nActual return on plan assets, excluding\ninterest income\n\n  \n \n(27,278\n) \n \n \n(19,496\n) \n \n \n63,950\n \n  \n \n7,757\n \n\nEmployer contributions\n\n  \n \n19,349\n \n \n \n15,683\n \n \n \n16,896\n \n  \n \n21,944\n \n\nPlan participants’ contributions\n\n  \n \n— \n \n \n \n4,022\n \n \n \n — \n \n  \n \n3,841\n \n\nBenefits paid\n\n  \n \n(59,027\n) \n \n \n(63,038\n) \n \n \n(55,091\n)\n  \n \n(72,880\n) \n\nExchange differences on translating\nforeign operations\n\n  \n \n — \n \n \n \n(24,582\n) \n \n \n — \n \n  \n \n79,116\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nBalance at end of year\n\n  \n¥\n1,199,267\n \n \n¥\n958,328\n \n \n¥\n1,251,679\n \n  \n¥\n1,046,282\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nEffects of asset ceiling\n\n  \n \n195,916\n \n \n \n37,807\n \n \n \n345,141\n \n  \n \n70,054\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nNet defined benefit liabilities (assets)\n\n  \n¥\n(23,099\n) \n \n¥\n86,075\n \n \n¥\n(26,001\n) \n  \n¥\n109,918\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nRetirement benefit assets included in net defined benefit liabilities (assets) as of March 31, 2025 and 2026 are ¥\n\n185,835 \n\nmillion and\n\n¥187,988 \nmillion, respectively, which are presented in other\nnon-current\nassets in the consolidated statements of financial position.\n\n \n\nF-5\n4\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n2) Fair value of plan assets\n\nHonda’s investment policies for the Japanese and foreign pension plan assets are designed to maximize total\n\nmedium-to-long\n\nterm returns that are available to provide future payments of pension benefits to eligible participants under accepted risks. Plan assets are invested in well-diversified Japanese and foreign individual equity and debt securities using target asset allocations, consistent with accepted tolerance for risks. Honda sets target asset allocations for each asset category with future anticipated performance over\n\nmedium-to-long\n\nterm periods based on the expected returns, long-term risks and historical returns. Target asset allocations are adjusted as necessary when there are significant changes in the investment environment of plan assets.\n\nThe fair value of the Japanese and foreign pension plan assets by asset category as of March 31, 2025 and 2026 is as follows:\n\nAs of March 31, 2025\n\n \n\n \n \n\nYen (millions)\n\n \n\n \n \n\nJapanese plans\n\n \n \n\nForeign plans\n\n \n\n \n \n\nMarket price in active\nmarket\n\n \n \n \n \n \n\nMarket price in active\nmarket\n\n \n \n \n \n\n \n \n\nQuoted\n\n \n \n\nUnquoted\n\n \n \n\nTotal\n\n \n \n\nQuoted\n\n \n \n\nUnquoted\n\n \n \n\nTotal\n\n \n\nCash and cash equivalents\n\n \n¥\n22,760\n \n \n¥\n— \n \n \n¥\n22,760\n \n \n¥\n8,124\n \n \n¥\n— \n \n \n¥\n8,124\n \n\nEquity securities:\n\n \n\n \n\n \n\n \n\n \n\n \n\nJapan\n\n \n \n22,005\n \n \n \n— \n \n \n \n22,005\n \n \n \n546\n \n \n \n— \n \n \n \n546\n \n\nUnited States\n\n \n \n200,605\n \n \n \n— \n \n \n \n200,605\n \n \n \n10,687\n \n \n \n— \n \n \n \n10,687\n \n\nOther\n\n \n \n145,261\n \n \n \n70\n \n \n \n145,331\n \n \n \n4,685\n \n \n \n2,048\n \n \n \n6,733\n \n\nDebt securities:\n\n \n\n \n\n \n\n \n\n \n\n \n\nJapan\n\n \n \n47,992\n \n \n \n1,262\n \n \n \n49,254\n \n \n \n— \n \n \n \n1,055\n \n \n \n1,055\n \n\nUnited States\n\n \n \n145,869\n \n \n \n23,544\n \n \n \n169,413\n \n \n \n— \n \n \n \n163,424\n \n \n \n163,424\n \n\nOther\n\n \n \n135,936\n \n \n \n115,050\n \n \n \n250,986\n \n \n \n— \n \n \n \n14,544\n \n \n \n14,544\n \n\nGroup annuity insurance:\n\n \n\n \n\n \n\n \n\n \n\n \n\nGeneral accounts\n\n \n \n— \n \n \n \n39,871\n \n \n \n39,871\n \n \n \n— \n \n \n \n— \n \n \n \n— \n \n\nSeparate accounts\n\n \n \n— \n \n \n \n29,531\n \n \n \n29,531\n \n \n \n— \n \n \n \n— \n \n \n \n— \n \n\nPooled funds:\n\n \n\n \n\n \n\n \n\n \n\n \n\nReal estate funds\n\n \n \n— \n \n \n \n209\n \n \n \n209\n \n \n \n— \n \n \n \n70,336\n \n \n \n70,336\n \n\nPrivate equity funds\n\n \n \n— \n \n \n \n— \n \n \n \n— \n \n \n \n— \n \n \n \n154,824\n \n \n \n154,824\n \n\nHedge funds\n\n \n \n— \n \n \n \n120,414\n \n \n \n120,414\n \n \n \n— \n \n \n \n26,400\n \n \n \n26,400\n \n\nCommingled and other mutual funds\n\n \n \n1,038\n \n \n \n158,217\n \n \n \n159,255\n \n \n \n— \n \n \n \n459,546\n \n \n \n459,546\n \n\nOther\n\n \n \n2\n \n \n \n(10,369\n) \n \n \n(10,367\n) \n \n \n382\n \n \n \n41,727\n \n \n \n42,109\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n \n¥\n721,468\n \n \n¥\n477,799\n \n \n¥\n1,199,267\n \n \n¥\n24,424\n \n \n¥\n933,904\n \n \n¥\n958,328\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nF-5\n5\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nAs of March 31,\n2026\n\n \n\n \n\n \n\nYen (millions)\n\n \n\n \n\n \n\nJapanese plans\n\n \n\n \n\nForeign plans\n\n \n\n \n\n \n\nMarket price in active\nmarket\n\n \n\n \n\n \n\n \n\n \n\nMarket price in active\nmarket\n\n \n\n \n\n \n\n \n\n \n\n \n\nQuoted\n\n \n\n \n\nUnquoted\n\n \n\n \n\nTotal\n\n \n\n \n\nQuoted\n\n \n\n \n\nUnquoted\n\n \n\n \n\nTotal\n\n \n\nCash and cash equivalents\n\n \n¥\n13,585\n \n \n¥\n— \n \n \n¥\n13,585\n \n \n¥\n13,491\n \n \n¥\n— \n \n \n¥\n13,491\n \n\nEquity securities:\n\n \n\n \n\n \n\n \n\n \n\n \n\nJapan\n\n \n \n21,501\n \n \n \n— \n \n \n \n21,501\n \n \n \n683\n \n \n \n— \n \n \n \n683\n \n\nUnited States\n\n \n \n207,710\n \n \n \n— \n \n \n \n207,710\n \n \n \n12,903\n \n \n \n— \n \n \n \n12,903\n \n\nOther\n\n \n \n177,745\n \n \n \n46\n \n \n \n177,791\n \n \n \n7,474\n \n \n \n2,281\n \n \n \n9,755\n \n\nDebt securities:\n\n \n\n \n\n \n\n \n\n \n\n \n\nJapan\n\n \n \n42,351\n \n \n \n1,862\n \n \n \n44,213\n \n \n \n— \n \n \n \n1,508\n \n \n \n1,508\n \n\nUnited States\n\n \n \n132,985\n \n \n \n33,228\n \n \n \n166,213\n \n \n \n— \n \n \n \n216,100\n \n \n \n216,100\n \n\nOther\n\n \n \n110,580\n \n \n \n152,253\n \n \n \n262,833\n \n \n \n— \n \n \n \n15,405\n \n \n \n15,405\n \n\nGroup annuity insurance:\n\n \n\n \n\n \n\n \n\n \n\n \n\nGeneral accounts\n\n \n \n— \n \n \n \n39,574\n \n \n \n39,574\n \n \n \n— \n \n \n \n— \n \n \n \n— \n \n\nSeparate accounts\n\n \n \n— \n \n \n \n34,851\n \n \n \n34,851\n \n \n \n— \n \n \n \n— \n \n \n \n— \n \n\nPooled funds:\n\n \n\n \n\n \n\n \n\n \n\n \n\nReal estate funds\n\n \n \n— \n \n \n \n713\n \n \n \n713\n \n \n \n— \n \n \n \n87,445\n \n \n \n87,445\n \n\nPrivate equity funds\n\n \n \n— \n \n \n \n— \n \n \n \n— \n \n \n \n— \n \n \n \n144,927\n \n \n \n144,927\n \n\nHedge funds\n\n \n \n— \n \n \n \n135,314\n \n \n \n135,314\n \n \n \n— \n \n \n \n1,586\n \n \n \n1,586\n \n\nCommingled and other mutual funds\n\n \n \n1,524\n \n \n \n152,818\n \n \n \n154,342\n \n \n \n— \n \n \n \n348,676\n \n \n \n348,676\n \n\nInsurance Contracts\n\n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n—\n \n \n \n127,441\n \n \n \n127,441\n \n\nOther\n\n \n \n(140\n) \n \n \n(6,821\n) \n \n \n(6,961\n) \n \n \n381\n \n \n \n65,981\n \n \n \n66,362\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n \n¥\n707,841\n \n \n¥\n543,838\n \n \n¥\n1,251,679\n \n \n¥\n34,932\n \n \n¥\n1,011,350\n \n \n¥\n1,046,282\n \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n3) Actuarial assumptions\n\nThe significant actuarial assumptions used to determine the present value of defined benefit obligations as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\n2025\n\n \n\n \n\n2026\n\n \n\n \n\n  \n\nJapanese plans\n\n \n\n \n\nForeign plans\n\n \n\n \n\nJapanese plans\n\n \n\n \n\nForeign plans\n\n \n\nDiscount rate\n\n  \n \n2.3\n% \n \n \n\n4.6 - 5.9\n\n% \n \n \n3.1\n% \n \n \n\n4.8 - 6.2\n\n% \n\nRate of salary increase\n\n  \n \n1.6\n% \n \n \n\n2.0 - 4.9\n\n% \n \n \n1.6\n% \n \n \n\n2.0 - 3.5\n\n% \n\n4) Sensitivity analysis\n\nThe effects on defined benefit obligations of 0.5% increase or decrease in the discount rate as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\n \n\n  \n\nJapanese plans\n\n \n\n  \n\nForeign plans\n\n \n\n  \n\nJapanese plans\n\n \n\n  \n\nForeign plans\n\n \n\n0.5% decrease\n\n  \n¥\n58,739 increase\n \n  \n¥\n62,310 increase\n \n  \n¥\n47,737 increase\n \n  \n¥\n62,969 increase\n \n\n0.5% increase\n\n  \n¥\n53,176 decrease\n \n  \n¥\n55,111 decrease\n \n  \n¥\n43,353 decrease\n \n  \n¥\n57,522 decrease\n \n\n \n\nF-5\n6\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nThis sensitivity analysis shows changes in defined benefit obligations as of March 31, 2025 and 2026, as a result of changes in actuarial assumptions that the Company can reasonably assume. This analysis is based on provisional calculations, and thus actual results may differ from the analysis. In addition, changes in the rate of salary increase are not expected.\n\n5) Cash flows\n\nThe amount of contributions to plan assets made by the Company and certain of its consolidated subsidiaries is determined based on various factors such as the level of salary and service years of employees, status of plan asset reserve, and actuarial calculations. In accordance with the provisions of the Defined Benefit Corporate Pension Act, the Honda Pension Fund also recalculates the amount of contributions every five years at the end of the reporting period as a base date, in an effort to ensure balanced finances in the future. The Company and certain of its consolidated subsidiaries may make contributions of a necessary amount if the amount of reserve falls below the minimum base amount.\n\nThe Company and certain of its consolidated subsidiaries expect to contribute ¥16,611 million to its Japanese pension plans and ¥30,261 million to its foreign pension plans in the year ending March 31, 202\n7\n.\n\nThe weighted average duration of defined benefit obligations as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\n \n\n  \n\nJapanese plans\n\n \n\n  \n\nForeign plans\n\n \n\n  \n\nJapanese plans\n\n \n\n  \n\nForeign plans\n\n \n\nWeighted average duration of defined benefit obligations\n\n  \n \n11 years\n \n  \n \n10 years\n \n  \n \n10 years\n \n  \n \n10 years\n \n\n(b) Personnel Expenses\n\nPersonnel expenses included in the consolidated statements of income for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n    2024    \n\n \n\n  \n\n    2025    \n\n \n\n  \n\n    2026    \n\n \n\nPersonnel expenses\n\n  \n¥\n1,807,731\n \n  \n¥\n1,934,596\n \n  \n¥\n2,021,349\n \n\nPersonnel expenses include salaries, bonuses, social security expenses and expenses relating to post-employment benefits.\n\n(19) Equity\n\n(a) Management of Capital\n\nHonda makes investments in capital and research and development to improve corporate value through growth on a global basis. In order to meet these funding needs, Honda makes capital management through consideration of the balance between financing liabilities and equity.\n\nFinancing liabilities and equity of Honda as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n 2026 \n\n \n\nFinancing liabilities\n\n  \n¥\n11,451,267\n \n  \n¥\n13,479,863\n \n\nEquity\n\n  \n \n12,627,822\n \n  \n \n12,148,072\n \n\n \n\nF-5\n7\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(b) Common Stock\n\nThe Company’s total number of shares authorized and issued for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nShares\n\n \n\n \n\n  \n\n2024\n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nTotal number of authorized shares\n\n  \n\n  \n\n  \n\nBalance at end of year\n\n  \n\n  \n\n  \n\nCommon shares, no par value\n\n  \n \n7,086,000,000\n \n  \n \n7,086,000,000\n \n  \n \n7,086,000,000\n \n\nTotal number of issued shares\n\n  \n\n  \n\n  \n\nBalance at beginning of year\n\n  \n \n1,811,428,430\n \n  \n \n5,280,000,000\n \n  \n \n5,280,000,000\n \n\nChanges during the year *\n\n  \n \n3,468,571,570\n \n  \n \n— \n \n  \n \n(747,000,000\n) \n\nBalance at end of year\n\n  \n \n5,280,000,000\n \n  \n \n5,280,000,000\n \n  \n \n4,533,000,000\n \n\n \n\nExplanatory notes:\n\n \n\n*1\n\nAs of the effective date of October 1, 2023, the Company implemented a\n\nthree-for-one\n\nstock split of its common stock to shareholders as of the record date of September 30, 2023.\n\n*2\n\nAs of February 29, 2024, the Company cancelled 154,285,290 shares of its treasury stock based on the resolution of the Board of Directors Meeting on February 8, 2024.\n\n*3\n\nAs of February 27, 2026, the Company cancelled 747,000,000 shares of its treasury stock based on the resolution of the Board of Directors Meeting on February 10, 2026.\n\nAll of the issued shares as of March 31, 2024, 2025 and 2026 have been paid in full.\n\n(c) Capital Surplus and Retained Earnings\n\nCapital surplus consists of surplus that is derived from equity transactions and not recorded in common stock, and its primary component is capital reserves. The Companies Act of Japan provides that no less than 50% of the\npaid-in\namount or proceeds of issuance of shares shall be incorporated in common stock, and that the remaining shall be incorporated in capital reserves. Capital reserves may be incorporated in common stock upon approval of the General Meeting of Shareholders.\n\nRetained earnings consist of legal reserves and accumulated earnings. The Companies Act of Japan provides that earnings in an amount equal to 10% of cash dividends from retained earnings shall be appropriated as a capital reserve or a legal reserve on the date of distribution of retained earnings until an aggregated amount of capital reserve and legal reserve equals 25% of common stock. Legal reserves may be used upon approval of the General Meeting of Shareholders. Certain foreign consolidated subsidiaries are also required to appropriate their earnings under the laws of respective countries.\n\nRetained earnings as of March 31, 2026 includes ¥293,864 million relating to Honda’s equity in undistributed earnings of affiliates and joint ventures.\n\n(d) Treasury Stock\n\nThe total number of the Company’s treasury stock held by Honda as of March 31, 2024, 2025 and 2026 is as follows:\n\n \n\n \n\n  \n\nShares\n\n \n\n \n\n  \n\n2024\n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nCommon shares\n\n  \n \n  451,092,624\n \n  \n \n  933,490,429\n \n  \n \n  640,419,559\n\n \n\nF-5\n8\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nUnder the Companies Act of Japan, the number of shares and total value of treasury stock acquisition may be determined, upon approval of the General Meeting of Shareholders, within the amount available for distribution. Furthermore, treasury stock may be acquired through market transactions or tender offers in accordance with the articles of incorporation within the conditions set forth in the Companies Act, upon approval of the Board of Directors.\n\n(e) Other Components of Equity\n\nThe changes in other components of equity for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\n \n\n \n\nYen (millions)\n\n \n\n \n\n \n\nRemeasurements of\ndefined benefit plans\n\n \n\n \n\nNet changes in revaluation of\nfinancial assets measured at\nfair value through other\ncomprehensive income\n\n \n\n \n\nExchange differences\non translating foreign\noperations\n\n \n\n \n\nCash flow hedge\n\n \n\n \n\nTotal\n\n \n\nBalance as of April 1, 2023\n\n \n\n¥\n\n—\n\n \n\n \n\n¥\n\n126,940\n\n \n\n \n\n¥\n\n1,290,457\n\n \n\n \n\n¥\n\n—\n\n \n\n \n\n¥\n\n1,417,397\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAdjustment during the year\n\n \n\n¥\n\n(18,194\n\n)\n\n \n\n¥\n\n(17,924\n\n)\n\n \n\n¥\n\n913,456\n\n \n\n \n\n¥\n\n—\n\n \n\n \n\n¥\n\n877,338\n\n \n\nReclassification to retained earnings\n\n \n\n \n\n18,194\n\n \n\n \n\n \n\n(479\n\n)\n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n17,715\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nBalance as of March 31, 2024\n\n \n\n¥\n\n—\n\n \n\n \n\n¥\n\n108,537\n\n \n\n \n\n¥\n\n2,203,913\n\n \n\n \n\n¥\n\n—\n\n \n\n \n\n¥\n\n2,312,450\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAdjustment during the year\n\n \n\n¥\n\n26,874\n\n \n\n \n\n¥\n\n(19,953\n\n)\n\n \n\n¥\n\n(143,608\n\n)\n\n \n\n¥\n\n—\n\n \n\n \n\n¥\n\n(136,687\n\n) \n\nReclassification to retained earnings\n\n \n\n \n\n(26,874\n\n)\n \n\n \n\n \n\n36,932\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n—\n\n \n\n \n\n \n\n10,058\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n \n\n¥\n\n—\n\n \n\n \n\n¥\n\n125,516\n\n \n\n \n\n¥\n\n2,060,305\n\n \n\n \n\n¥\n\n—\n\n \n\n \n\n¥\n\n2,185,821\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAdjustment during the year\n\n \n\n¥\n\n(14,637\n\n)\n\n \n\n¥\n\n134,224\n\n \n\n \n\n¥\n\n738,648\n\n \n\n \n\n¥\n\n11,021\n\n \n\n \n\n¥\n\n869,256\n\n \n\nReclassification to retained earnings\n\n \n\n \n\n14,637\n\n \n\n \n\n \n\n(22,225\n\n)\n\n \n\n \n\n—\n\n \n\n \n\n \n\n \n\n(7,588\n\n) \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n \n\n¥\n\n—\n\n \n\n \n\n¥\n\n237,515\n\n \n\n \n\n¥\n\n2,798,953\n\n \n\n \n\n¥\n\n11,021\n\n \n\n \n\n¥\n\n3,047,489\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nF-5\n9\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(f) Other Comprehensive Income\n\nEach component of other comprehensive income and related tax effect including\nnon-controlling\ninterests for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\nFor the year ended March 31, 2024\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\nBefore-tax\n\n \n \n\nTax benefit\n(expense)\n\n \n \n\nNet-of-tax\n\n \n\nItems that will not be reclassified to profit or loss:\n\n  \n\n \n\n \n\nRemeasurements of defined benefit plans:\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n¥\n(30,696\n) \n \n¥\n11,765\n \n \n¥\n(18,931\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet changes\n\n  \n \n(30,696\n) \n \n \n11,765\n \n \n \n(18,931\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet changes in revaluation of financial assets measured at fair value through other comprehensive income:\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n(27,034\n) \n \n \n1,565\n \n \n \n(25,469\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet changes\n\n  \n \n(27,034\n) \n \n \n1,565\n \n \n \n(25,469\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nShare of other comprehensive income of investments accounted for using the equity method:\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n8,976\n \n \n \n(676\n) \n \n \n8,300\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet changes\n\n  \n \n8,976\n \n \n \n(676\n) \n \n \n8,300\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nItems that may be reclassified subsequently to profit or loss:\n\n  \n\n \n\n \n\nNet changes in revaluation of financial assets measured at\n \n\nfair value through other comprehensive income:\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n149\n \n \n \n(83\n) \n \n \n66\n \n\nReclassification to profit or loss\n\n  \n \n(78\n) \n \n \n68\n \n \n \n(10\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet changes\n\n  \n \n71\n \n \n \n(15\n) \n \n \n56\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nExchange differences on translating foreign operations:\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n880,235\n \n \n \n(2,727\n) \n \n \n877,508\n \n\nReclassification to profit or loss\n\n  \n \n(5,185\n) \n \n \n2,727\n \n \n \n(2,458\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet changes\n\n  \n \n875,050\n \n \n \n— \n \n \n \n875,050\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nShare of other comprehensive income of investments accounted for using the equity method:\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n57,139\n \n \n \n(2,850\n) \n \n \n54,289\n \n\nReclassification to profit or loss\n\n  \n \n64\n \n \n \n— \n \n \n \n64\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet changes\n\n  \n \n57,203\n \n \n \n(2,850\n) \n \n \n54,353\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal other comprehensive income\n\n  \n¥\n883,570\n \n \n¥\n9,789\n \n \n¥\n893,359\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nF-\n60\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nFor the year ended March 31, 2025\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\nBefore-tax\n\n \n \n\nTax benefit\n(expense)\n\n \n \n\nNet-of-tax\n\n \n\nItems that will not be reclassified to profit or loss:\n\n  \n\n \n\n \n\nRemeasurements of defined benefit plans:\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n¥\n33,986\n \n \n¥\n(7,259\n) \n \n¥\n26,727\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet changes\n\n  \n \n33,986\n \n \n \n(7,259\n) \n \n \n26,727\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet changes in revaluation of financial assets measured at fair value through other comprehensive income:\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n(23,320\n) \n \n \n9,843\n \n \n \n(13,477\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet changes\n\n  \n \n(23,320\n) \n \n \n9,843\n \n \n \n(13,477\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nShare of other comprehensive income of investments accounted for using the equity method:\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n(7,029\n) \n \n \n530\n \n \n \n(6,499\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet changes\n\n  \n \n(7,029\n) \n \n \n530\n \n \n \n(6,499\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nItems that may be reclassified subsequently to profit or loss:\n\n  \n\n \n\n \n\nNet changes in revaluation of financial assets measured at\n \n\nfair value through other comprehensive income:\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n582\n \n \n \n(128\n) \n \n \n454\n \n\nReclassification to profit or loss\n\n  \n \n(50\n) \n \n \n11\n \n \n \n(39\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet changes\n\n  \n \n532\n \n \n \n(117\n) \n \n \n415\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nExchange differences on translating foreign operations:\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n(162,200\n) \n \n \n(2\n) \n \n \n(162,202\n) \n\nReclassification to profit or loss\n\n  \n \n(125\n) \n \n \n2\n \n \n \n(123\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet changes\n\n  \n \n(162,325\n) \n \n \n— \n \n \n \n(162,325\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nShare of other comprehensive income of investments\naccounted for using the equity method:\n\n  \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n20,910\n \n \n \n(1,190\n) \n \n \n19,720\n \n\nReclassification to profit or loss\n\n  \n \n(1,319\n) \n \n \n— \n \n \n \n(1,319\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet changes\n\n  \n \n19,591\n \n \n \n(1,190\n) \n \n \n18,401\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal other comprehensive income\n\n  \n¥\n(138,565\n) \n \n¥\n1,807\n \n \n¥\n(136,758\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nF-\n6\n1\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nFor the year ended March 31, 2026\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\nBefore-tax\n\n \n\n \n\nTax benefit\n(expense)\n\n \n\n \n\nNet-of-tax\n\n \n\nItems that will not be reclassified to profit or loss:\n\n  \n\n  \n\n  \n\nRemeasurements of defined benefit plans:\n\n  \n\n  \n\n  \n\nAmount incurred during the year\n\n  \n¥\n(10,970\n)\n  \n¥\n(4,076\n) \n  \n¥\n(15,046\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nNet changes\n\n  \n \n(10,970\n)\n  \n \n(4,076\n) \n  \n \n(15,046\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nNet changes in revaluation of financial assets measured at fair value through other comprehensive income:\n\n  \n\n  \n\n  \n\nAmount incurred during the year\n\n  \n \n179,774\n \n  \n \n(48,660\n) \n  \n \n131,114\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nNet changes\n\n  \n \n179,774\n \n  \n \n(48,660\n) \n  \n \n131,114\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nShare of other comprehensive income of investments accounted for using the equity method:\n\n  \n\n  \n\n  \n\nAmount incurred during the year\n\n  \n \n3,398\n \n  \n \n82\n \n  \n \n3,480\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nNet changes\n\n  \n \n3,398\n \n  \n \n82\n \n  \n \n3,480\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nItems that may be reclassified subsequently to profit or loss:\n\n  \n\n  \n\n  \n\nNet changes in revaluation of financial assets measured at\n \n\nfair value through other comprehensive income:\n\n  \n\n  \n\n  \n\nAmount incurred during the year\n\n  \n \n(215\n)\n  \n \n52\n \n  \n \n(163\n)\n\nReclassification to profit or loss\n\n  \n \n120\n \n  \n \n(28\n) \n  \n \n92\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nNet changes\n\n  \n \n(95\n)\n  \n \n24\n \n  \n \n(71\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nExchange differences on translating foreign operations:\n\n  \n\n  \n\n  \n\nAmount incurred during the year\n\n  \n \n702,846\n \n  \n \n(26\n) \n  \n \n702,820\n \n\nReclassification to profit or loss\n\n  \n \n(921\n)\n  \n \n26\n \n  \n \n(895\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nNet changes\n\n  \n \n701,925\n \n  \n \n—\n \n  \n \n701,925\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nCash flow hedge\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nAmount incurred during the year\n\n  \n \n76,045\n \n \n \n(23,574\n) \n \n \n52,471\n \n\nReclassification to profit or loss\n\n  \n \n(60,072\n) \n \n \n18,622\n \n \n \n(41,450\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet changes\n\n  \n \n15,973\n \n \n \n(4,952\n) \n \n \n11,021\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nShare of other comprehensive income of investments accounted for using the equity method:\n\n  \n\n  \n\n  \n\nAmount incurred during the year\n\n  \n \n63,775\n \n  \n \n171\n \n  \n \n63,946\n \n\nReclassification to profit or loss\n\n  \n \n(3,999\n)\n  \n \n—\n \n  \n \n(3,999\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nNet changes\n\n  \n \n59,776\n \n  \n \n171\n \n  \n \n59,947\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal other comprehensive income\n\n  \n¥\n949,781\n \n  \n¥\n(57,411)\n \n  \n¥\n892,370\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\nF-\n6\n2\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nThe components of other comprehensive income included in\nnon-controlling\ninterests for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2024\n\n \n\n  \n\n2025\n\n \n\n \n\n2026\n\n \n\nItems that will not be reclassified to profit or loss:\n\n  \n\n  \n\n \n\nRemeasurements of defined benefit plans\n\n  \n¥\n186\n \n  \n¥\n90\n \n \n¥\n(137\n) \n\nNet changes in revaluation of financial assets measured at fair value through other comprehensive income\n\n  \n \n     6\n \n  \n \n  155\n \n \n \n27\n \n\nItems that may be reclassified subsequently to profit or loss:\n\n  \n\n  \n\n \n\nExchange differences on translating foreign operations\n\n  \n \n18,893\n \n  \n \n(316\n) \n \n \n23,224\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n 19,085\n \n  \n¥\n(71\n) \n \n¥\n23,114\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n(g) Dividends from Retained Earnings\n\nThe Company distributes retained earnings within the available amount calculated in accordance with the Companies Act of Japan. The amount of retained earnings available for distribution is calculated based on the amount of retained earnings recorded in the Company’s\nnon-consolidated\naccounting records prepared in accordance with accounting principles generally accepted in Japan.\n\nThe amounts recognized as dividends of retained earnings for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\n1) Dividend payout\n\nFor the year ended March 31, 2024\n\n \n\nResolution\n \nThe Board of Directors Meeting on May 11, 2023\n\nType of shares\n \nCommon shares\n\nTotal amount of dividends (millions of yen)\n \n99,915\n\nDividend per share (yen)\n \n60.00\n\nRecord date\n \nMarch 31, 2023\n\nEffective date\n \nJune 6, 2023\n\nResolution\n\n \n\nThe Board of Directors Meeting on November 9, 2023\n\nType of shares\n \nCommon shares\n\nTotal amount of dividends (millions of yen)\n \n141,949\n\nDividend per share (yen)\n \n87.00\n\nRecord date\n \nSeptember 30, 2023\n\nEffective date\n \nDecember 5, 2023\n\n \n\nExplanatory note:\n\n \n\n*\n\nAs of the effective date of October 1, 2023, the Company implemented a three-for-one stock split of its common stock to shareholders as of the record date of September 30, 2023. Dividend per share is an amount prior to the stock split.\n\n \n\nF-\n6\n3\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nFor the year ended March 31, 2025\n\n \n\nResolution\n \nThe Board of Directors Meeting on May 10, 2024\n\nType of shares\n \nCommon shares\n\nTotal amount of dividends (millions of yen)\n \n188,418\n\nDividend per share (yen)\n \n39.00\n\nRecord date\n \nMarch 31, 2024\n\nEffective date\n \nJune 4, 2024\n\nResolution\n\n \n\nThe Board of Directors Meeting on November 6, 2024\n\nType of shares\n \nCommon shares\n\nTotal amount of dividends (millions of yen)\n \n159,386\n\nDividend per share (yen)\n \n34.00\n\nRecord date\n \nSeptember 30, 2024\n\nEffective date\n \nDecember 4, 2024\n\nFor the year ended March 31, 2026\n\n \n\nResolution\n \nThe Board of Directors Meeting on May 13, 2025\n\nType of shares\n \nCommon shares\n\nTotal amount of dividends (millions of yen)\n \n147,960\n\nDividend per share (yen)\n \n34.00\n\nRecord date\n \nMarch 31, 2025\n\nEffective date\n \nJune 5, 2025\n\nResolution\n\n \n\nThe Board of Directors Meeting on November 7, 2025\n\nType of shares\n \nCommon shares\n\nTotal amount of dividends (millions of yen)\n \n136,430\n\nDividend per share (yen)\n \n35.00\n\nRecord date\n \nSeptember 30, 2025\n\nEffective date\n \nDecember 5, 2025\n\n2) Dividends payable of which record date was in the year ended March 31, 2026, effective after the period\n\n \n\nResolution\n \nThe Board of Directors Meeting on May 14, 2026\n\nType of shares\n \nCommon shares\n\nResource for dividend\n \nRetained earnings\n\nTotal amount of dividends (millions of yen)\n \n136,430\n\nDividend per share (yen)\n \n35.00\n\nRecord date\n \nMarch 31, 2026\n\nEffective date\n \nJune 9, 2026\n\n \n\nF-6\n4\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(20) Sales Revenue\n\n(a) Disaggregation of revenue\n\nAs stated in Note 4, Honda discloses segment information in four categories.\n\nThe sales revenue disaggregated by geographical markets based on the location of the customer and the reconciliation of the disaggregated sales revenue with each segment for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\nFor the year ended March 31, 2024\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\nMotorcycle\nBusiness\n\n \n  \n\nAutomobile\nBusiness\n\n \n  \n\nFinancial\nServices\nBusiness\n\n \n  \n\nPower\nProducts\nand Other\nBusinesses\n\n \n  \n\nTotal\n\n \n\nRevenue arising from contracts with customers\n\n  \n\n  \n\n  \n\n  \n\n  \n\nJapan\n\n  \n¥\n113,746\n \n  \n¥\n1,586,358\n \n  \n¥\n172,072\n \n  \n¥\n87,072\n \n  \n¥\n1,959,248\n \n\nNorth America\n\n  \n \n335,545\n \n  \n \n8,503,602\n \n  \n \n1,487,948\n \n  \n \n138,760\n \n  \n \n10,465,855\n \n\nEurope\n\n  \n \n351,850\n \n  \n \n506,731\n \n  \n \n— \n \n  \n \n84,459\n \n  \n \n943,040\n \n\nAsia\n\n  \n \n1,792,327\n \n  \n \n2,446,250\n \n  \n \n5\n \n  \n \n55,898\n \n  \n \n4,294,480\n \n\nOther Regions\n\n  \n \n625,585\n \n  \n \n498,506\n \n  \n \n— \n \n  \n \n26,001\n \n  \n \n1,150,092\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n3,219,053\n \n  \n¥\n13,541,447\n \n  \n¥\n1,660,025\n \n  \n¥\n392,190\n \n  \n¥\n18,812,715\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nRevenue arising from the other sources*\n\n  \n \n1,115\n \n  \n \n26,118\n \n  \n \n1,588,783\n \n  \n \n71\n \n  \n \n1,616,087\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n3,220,168\n \n  \n¥\n13,567,565\n \n  \n¥\n3,248,808\n \n  \n¥\n392,261\n \n  \n¥\n20,428,802\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nFor the year ended March 31, 2025\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\nMotorcycle\nBusiness\n\n \n  \n\nAutomobile\nBusiness\n\n \n  \n\nFinancial\nServices\nBusiness\n\n \n  \n\nPower\nProducts\nand Other\nBusinesses\n\n \n  \n\nTotal\n\n \n\nRevenue arising from contracts with customers\n\n  \n\n  \n\n  \n\n  \n\n  \n\nJapan\n\n  \n¥\n106,632\n \n  \n¥\n1,794,911\n \n  \n¥\n193,188\n \n  \n¥\n88,943\n \n  \n¥\n2,183,674\n \n\nNorth America\n\n  \n \n347,503\n \n  \n \n9,379,001\n \n  \n \n1,456,899\n \n  \n \n127,991\n \n  \n \n11,311,394\n \n\nEurope\n\n  \n \n379,432\n \n  \n \n459,755\n \n  \n \n— \n \n  \n \n77,859\n \n  \n \n917,046\n \n\nAsia\n\n  \n \n2,071,481\n \n  \n \n1,953,109\n \n  \n \n15\n \n  \n \n62,018\n \n  \n \n4,086,623\n \n\nOther Regions\n\n  \n \n714,537\n \n  \n \n563,025\n \n  \n \n— \n \n  \n \n28,251\n \n  \n \n1,305,813\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n3,619,585\n \n  \n¥\n14,149,801\n \n  \n¥\n1,650,102\n \n  \n¥\n385,062\n \n  \n¥\n19,804,550\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nRevenue arising from the other sources*\n\n  \n \n7,018\n \n  \n \n19,439\n \n  \n \n1,857,664\n \n  \n \n96\n \n  \n \n1,884,217\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n3,626,603\n \n  \n¥\n14,169,240\n \n  \n¥\n3,507,766\n \n  \n¥\n385,158\n \n  \n¥\n21,688,767\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\nF-6\n5\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nFor the year ended March 31, 2026\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\nMotorcycle\nBusiness\n\n \n\n  \n\nAutomobile\nBusiness\n\n \n\n  \n\nFinancial\nServices\nBusiness\n\n \n\n  \n\nPower\nProducts\nand Other\nBusinesses\n\n \n\n  \n\nTotal\n\n \n\nRevenue arising from contracts with customers\n\n  \n\n  \n\n  \n\n  \n\n  \n\nJapan\n\n  \n¥\n113,293\n \n  \n¥\n1,803,549\n \n  \n¥\n206,813\n \n  \n¥\n98,565\n \n  \n¥\n2,222,220\n \n\nNorth America\n\n  \n \n351,787\n \n  \n \n9,208,711\n \n  \n \n1,256,995\n \n  \n \n118,029\n \n  \n \n10,935,522\n \n\nEurope\n\n  \n \n395,855\n \n  \n \n503,213\n \n  \n \n—\n \n  \n \n80,991\n \n  \n \n980,059\n \n\nAsia\n\n  \n \n2,252,025\n \n  \n \n1,764,489\n \n  \n \n44\n \n  \n \n58,453\n \n  \n \n4,075,011\n \n\nOther Regions\n\n  \n \n901,346\n \n  \n \n562,603\n \n  \n \n—\n \n  \n \n28,866\n \n  \n \n1,492,815\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n4,014,306\n \n  \n¥\n13,842,565\n \n  \n¥\n1,463,852\n \n  \n¥\n384,904\n \n  \n¥\n19,705,627\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nRevenue arising from the other sources*\n\n  \n \n4,531\n \n  \n \n20,797\n \n  \n \n2,065,632\n \n  \n \n23\n \n  \n \n2,090,983\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n4,018,837\n \n  \n¥\n13,863,362\n \n  \n¥\n3,529,484\n \n  \n¥\n384,927\n \n  \n¥\n21,796,610\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\nExplanatory note:\n\n \n\n*\n\nRevenue arising from the other sources primarily includes lease revenues recognized under IFRS 16 and interest recognized under IFRS 9.\n\n(b) Contract balances\n\nThe receivables from contracts with customers and contract liabilities for the years ended March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nReceivables from contracts with customers:\n\n  \n\n  \n\nTrade receivables\n\n  \n¥\n888,774\n \n  \n¥\n918,792\n \n\nContract liabilities:\n\n  \n\n  \n\nOther current liabilities\n\n  \n \n411,941\n \n  \n \n412,227\n \n\nOther noncurrent liabilities\n\n  \n \n329,298\n \n  \n \n364,505\n \n\nThe amounts of revenue recognized for the years ended March 31, 2024, 2025 and 2026 that were included in the contract liability balances at the beginning of the year are ¥273,224 million, ¥343,681 million and ¥\n\n365,951\n\nmillion\n, respectively. The amounts of revenue recognized for the years ended March 31, 2024, 2025 and 2026 from performance obligations satisfied (or partially satisfied) in previous years were immaterial. In addition, the balances of contract assets were immaterial.\n\n \n\nF-6\n6\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(c) Transaction price allocated to the remaining performance obligation\n\nThe revenue expected to be recognized in the future related to performance obligations that are unsatisfied (or partially unsatisfied) as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nWithin 1 year\n\n  \n¥\n245,826\n \n  \n¥\n255,808\n \n\nBetween 1 and 5 years\n\n  \n \n363,831\n \n  \n \n402,934\n \n\nLater than 5 years\n\n  \n \n26,275\n \n  \n \n31,045\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n635,932\n \n  \n¥\n689,787\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nThe table does not include the remaining performance obligations that have original expected durations of one year or less and estimated amounts of variable consideration that are constrained from being recognized as revenue.\n\n(d) Assets recognized from the costs to obtain or fulfill a contract with a customer\n\nThe assets recognized from the costs to obtain a contract with a customer as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nAssets recognized from the costs to obtain a contract with a customer\n\n  \n¥\n192,532\n \n  \n¥\n223,973\n \n\nHonda recognizes the incremental costs of obtaining a contract with a customer and the costs incurred in fulfilling a contract with a customer that are directly associated with the contract as an asset, if those costs are expected to be recoverable. The incremental costs of obtaining a contract are those costs that an entity incurs to obtain a contract with a customer that it would not have incurred if the contract had not been obtained. The assets recognized from the costs to obtain a contract are presented in the consolidated statement of financial position mainly as other\nnon-current\nassets and are amortized over the period for which the services based on a contract are provided. The amounts of assets recognized from the costs to fulfill a contract are not material.\n\nThe amounts of amortization of the assets for the years ended March 31, 2024, 2025 and 2026 are ¥60,391 million, ¥66,438 million and ¥\n\n74,799\nmillion\n, respectively.\n\n(21) Research and Development\n\nResearch and development costs for the years ended March 31, 2024, 2025 and 2026 consist of the following:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2024\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nResearch and development expenditures incurred during the reporting period\n\n  \n¥\n976,366\n \n \n¥\n1,210,620\n \n \n¥\n1,174,848\n \n\nAmount capitalized\n\n  \n \n(207,519\n) \n \n \n(287,098\n) \n \n \n(198,806\n) \n\nAmortization, impairment losses and losses on disposal of capitalized development costs\n\n  \n \n154,780\n \n \n \n175,960\n \n \n \n564,604\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n923,627\n \n \n¥\n1,099,482\n \n \n¥\n1,540,646\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nF-6\n7\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nFor the details of EV-related impairment losses and losses on disposal, see note 4(d).\n\n(22) Finance Income and Finance Costs\n\nFinance income and finance costs for the years ended March 31, 2024, 2025 and 2026 consist of the following:\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\n2024\n\n \n \n\n2025\n\n \n \n\n2026\n\n \n\nInterest income:\n\n  \n\n \n\n \n\nFinancial assets measured at amortized cost\n\n  \n¥\n  169,287\n \n \n¥\n  184,928\n \n \n¥\n168,455\n \n\nFinancial assets measured at fair value through other comprehensive income\n\n  \n \n798\n \n \n \n1,206\n \n \n \n1,242\n \n\nFinancial assets measured at fair value through profit or loss\n\n  \n \n3,610\n \n \n \n4,997\n \n \n \n5,404\n \n\nOther\n\n  \n \n—\n \n \n \n—\n \n \n \n4,365\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n173,695\n \n \n \n191,131\n \n \n \n179,466\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nInterest expense:\n\n  \n\n \n\n \n\nFinancial liabilities measured at amortized cost\n\n  \n \n(42,609\n) \n \n \n(45,385\n) \n \n \n(59,731\n) \n\nOther\n\n  \n \n(17,022\n) \n \n \n(9,522\n) \n \n \n(23,831\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n(59,631\n) \n \n \n(54,907\n) \n \n \n(83,562\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nOther, net:\n\n  \n\n \n\n \n\nDividends received:\n\n  \n\n \n\n \n\nFinancial assets measured at fair value through other\ncomprehensive income\n\n  \n \n8,804\n \n \n \n15,037\n \n \n \n15,578\n \n\nGains (losses) on derivatives:\n\n  \n\n \n\n \n\nFinancial assets and financial liabilities measured at fair\nvalue through profit or loss\n\n  \n \n(202\n) \n \n \n(24,783\n) \n \n \n65,195\n \n\nGains (losses) on foreign exchange\n\n  \n \n67,414\n \n \n \n(22,009\n) \n \n \n(29,159\n) \n\nOther\n\n  \n \n(40,490\n) \n \n \n(1,297\n) \n \n \n25,608\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n \n35,526\n \n \n \n(33,052\n) \n \n \n77,222\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n149,590\n \n \n¥\n103,172\n \n \n¥\n173,126\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nF-68\n\n[Table of Contents](#toc)\n\nHONDA MOT\nOR\nCO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(23) Income Taxes\n\n(a) Income Tax Expense\n\nProfit (loss) before income taxes and income tax expense for the years ended March 31, 2024, 2025 and 2026 consist of the following:\n\n \n\n \n\n \n\nYen (millions)\n\n \n\n \n\n \n\n2024\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\n \n\n \n\nJapan\n\n \n\n \n\nForeign\n\n \n\n \n\nTotal\n\n \n\n \n\nJapan\n\n \n\n \n\nForeign\n\n \n\n \n\nTotal\n\n \n\n \n\nJapan\n\n \n\n \n\nForeign\n\n \n\n \n\nTotal\n\n \n\nProfit (loss) before income taxes\n\n \n¥\n148,651\n \n \n¥\n1,493,733\n \n \n¥\n1,642,384\n \n \n¥\n180,912\n \n \n¥\n1,136,728\n \n \n¥\n1,317,640\n \n \n¥\n(800,827\n)\n \n¥\n397,527\n \n \n¥\n(403,300\n)\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nIncome tax expense (benefit):\n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\n \n\nCurrent taxes\n\n \n \n19,081\n \n \n \n606,077\n \n \n \n625,158\n \n \n \n28,922\n \n \n \n499,076\n \n \n \n527,998\n \n \n \n(17,268\n)\n \n \n231,347\n \n \n \n214,079\n \n\nDeferred taxes\n\n \n \n34,265\n \n \n \n(199,629\n) \n \n \n(165,364\n) \n \n \n(3,821\n) \n \n \n(109,571\n) \n \n \n(113,392\n) \n \n \n(187,375\n) \n \n \n(76,981\n) \n \n \n(264,356\n) \n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n \n¥\n53,346\n \n \n¥\n406,448\n \n \n¥\n459,794\n \n \n¥\n25,101\n \n \n¥\n389,505\n \n \n¥\n414,606\n \n \n¥\n(204,643\n)\n \n¥\n154,366\n \n \n¥\n(50,277\n)\n\n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nThe statutory income tax rate in\n\n Japan is approximately 30.2% for each of the years in the three-year period ended March 31, 2026. The Japanese statutory income tax rate for the years ended March 31, 2024, 2025 and 2026 differs from the average effective tax rate for the following reasons:\n\n \n\n \n  \n\n2024\n\n \n \n\n2025\n\n \n \n\n2026\n\n \n\nStatutory income tax rate\n\n  \n \n30.2\n% \n \n \n30.2\n% \n \n \n30.2\n% \n\nDifference in statutory income tax rates of foreign subsidiaries\n\n  \n \n(5.4\n)\n \n \n(5.2\n)\n \n \n14.5\n \n\nEffects of investments accounted for using the equity method\n\n  \n \n(2.0\n)\n \n \n0.0\n \n \n \n(12.0\n)\n\nEffects of undistributed earnings and withholding taxes on royalty\n\n  \n \n6.1\n \n \n \n7.0\n \n \n \n(23.0\n)\n\nChanges in unrecognized deferred tax assets\n\n  \n \n0.1\n \n \n \n1.1\n \n \n \n(9.8\n)\n\nEffects of income and expense not taxable and deductible for tax purpose\n\n  \n \n0.0\n \n \n \n0.5\n \n \n \n0.1\n \n\nEffects of tax credit\n\n  \n \n(2.6\n)\n \n \n(2.2\n)\n \n \n3.9\n \n\nOther adjustments relating to prior years\n\n  \n \n(0.1\n)\n \n \n(2.1\n)\n \n \n3.7\n \n\nAdjustments for the uncertain tax treatments on income taxes\n\n  \n \n0.1\n \n \n \n0.6\n \n \n \n2.8\n \n\nAdjustments for the changes in income tax laws\n\n  \n \n0.2\n \n \n \n0.4\n \n \n \n0.3\n \n\nOther\n\n  \n \n1.4\n \n \n \n1.2\n \n \n \n1.8\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nAverage effective tax rate\n\n  \n \n28.0\n% \n \n \n31.5\n% \n \n \n12.5\n% \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nF-6\n9\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(b) Deferred Tax Assets and Deferred Tax Liabilities\n\nThe components by major factor in deferred tax assets and deferred tax liabilities as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\n2025\n\n \n \n\n2026\n\n \n\nDeferred tax assets:\n\n  \n\n \n\nInventories\n\n  \n¥\n62,292\n \n \n¥\n 100,609\n \n\nAccrued expenses\n\n  \n \n64,632\n \n \n \n88,280\n \n\nProvisions\n\n  \n \n243,174\n \n \n \n349,210\n \n\nProperty, plant and equipment\n\n  \n \n55,231\n \n \n \n29,954\n \n\nIntangible assets\n\n  \n \n91,540\n \n \n \n24,796\n \n\nRetirement benefit liabilities\n\n  \n \n60,634\n \n \n \n65,601\n \n\nLease liabilities\n\n  \n \n82,117\n \n \n \n83,511\n \n\nCarryforward of unused tax losses\n\n  \n \n36,057\n \n \n \n289,535\n \n\nCarryforward of unused tax credit\n\n  \n \n4,932\n \n \n \n31,182\n \n\nOther\n\n  \n \n137,622\n \n \n \n192,744\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n838,231\n \n \n¥\n1,255,422\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nDeferred tax liabilities:\n\n  \n\n \n\nProperty, plant and equipment\n\n  \n¥\n151,402\n \n \n¥\n166,998\n \n\nIntangible assets\n\n  \n \n236,577\n \n \n \n145,488\n \n\nOther financial assets\n\n  \n \n62,934\n \n \n \n109,506\n \n\nOperating leases\n\n  \n \n721,248\n \n \n \n969,049\n \n\nUndistributed earnings\n\n  \n \n71,781\n \n \n \n64,126\n \n\nRetirement benefit assets\n\n  \n \n44,309\n \n \n \n40,709\n \n\nReceivables from financial services\n\n  \n \n34,337\n \n \n \n32,874\n \n\nOther\n\n  \n \n90,228\n \n \n \n103,052\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n1,412,816\n \n \n¥\n1,631,802\n \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nNet deferred tax assets (liabilities)\n\n  \n¥\n(574,585\n) \n \n¥\n(376,380\n) \n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nThe changes in deferred tax assets and deferred tax liabilities recognized as income tax expense in the consolidated statements of income for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2024\n\n \n\n \n\n2025\n\n \n\n \n\n2026\n\n \n\nInventories\n\n  \n¥\n(8,335\n) \n \n¥\n(2,284\n) \n \n¥\n(36,309\n) \n\nProvisions\n\n  \n \n(26,423\n) \n \n \n(75,290\n) \n \n \n(95,600\n)\n\nProperty, plant and equipment\n\n  \n \n(41,544\n) \n \n \n(16,389\n) \n \n \n34,336\n \n\nRetirement benefit liabilities (assets)\n\n  \n \n(1,840\n) \n \n \n3,308\n \n \n \n(16,131\n)\n\nOperating leases\n\n  \n \n(93,321\n) \n \n \n(46,698\n) \n \n \n186,390\n \n\nUndistributed earnings\n\n  \n \n8,355\n \n \n \n(537\n) \n \n \n(7,146\n)\n\nCarryforward of unused tax losses\n\n  \n \n17,652\n \n \n \n  59,300\n \n \n \n(242,704\n)\n\nCarryforward of unused tax credit\n\n  \n \n   4,238\n \n \n \n6,400\n \n \n \n(24,419\n)\n\nOther\n\n  \n \n(24,146\n) \n \n \n(41,202\n) \n \n \n(62,773\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n \n\n(165,364\n) \n \n¥\n \n\n(113,392\n) \n \n¥\n \n\n(264,356\n)\n\n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n \n\n \n\n \n\n \n\n \n\nF-\n70\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nHonda\n\n considers the probability that a portion of, or all of, the deductible temporary differences, carryforward of unused tax losses and carryforward of unused tax credit can be utilized against future taxable profits in the recognition of deferred tax assets. In assessing recoverability of deferred tax assets, management considers the scheduled reversal of deferred tax liabilities, projected future taxable profit and tax planning strategies. Based upon the level of historical taxable profit and projections for future taxable profit over the periods for which the deferred tax assets are deductible, management believes it is probable that Honda will utilize the benefits of these deferred tax assets as of March 31, 2025 and 2026. Uncertainty of estimates of future taxable profit could increase due to changes in the economic environment surrounding Honda, effects by market conditions, effects of currency fluctuations or other factors. Deferred tax assets recognized by entities that have suffered a loss in either the preceding or current period are ¥\n637\n million and ¥\n103,123\n million as of March 31, 2025 and 2026, respectively.\n\nDeductible temporary differences, carryforward of unused tax losses and carryforward of unused tax credit for which deferred tax assets are not recognized as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\n2025\n\n \n  \n\n2026\n\n \n\nDeductible temporary differences\n\n  \n¥\n461,089\n \n  \n¥\n546,073\n \n\nCarryforward of unused tax losses\n\n  \n \n436,674\n \n  \n \n566,262\n \n\nCarryforward of unused tax credit\n\n  \n \n124,850\n \n  \n \n377\n \n\nThe components by expiry of the carryforward of unused tax losses for which deferred tax assets are not recognized as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\n2025\n\n \n  \n\n2026\n\n \n\nWithin 1 year\n\n  \n¥\n12,142\n \n  \n¥\n16,853\n \n\nBetween 1 and 5 years\n\n  \n \n92,042\n \n  \n \n204,354\n \n\nBetween 5 and 20 years\n\n  \n \n36,115\n \n  \n \n49,376\n \n\nIndefinite periods\n\n  \n \n296,375\n \n  \n \n295,679\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n436,674\n \n  \n¥\n566,262\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nThe components by expiry of the carryforward of unused tax credit for which deferred tax assets are not recognized as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\n2025\n\n \n  \n\n2026\n\n \n\nWithin 1 year\n\n  \n¥\n4\n \n  \n¥\n23\n \n\nBetween 1 and 5 years\n\n  \n \n124,831\n \n  \n \n354\n \n\nBetween 5 and 20 years\n\n  \n \n15\n \n  \n \n—\n \n\nIndefinite periods\n\n  \n \n—\n \n  \n \n—\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n124,850\n \n  \n¥\n377\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nThe aggregate amounts of temporary differences\n\n relating to investments in subsidiaries and interests in joint ventures for which deferred tax liabilities are not recognized as of March 31, 2025 and 2026 are ¥8,127,532 million and ¥9,268,070 million, respectively.\n\n \n\nF-71\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(24) Earnings Per Share\n\nEarnings (loss) per share attributable to owners of the parent for the years ended March 31, 2024, 2025 and 2026 are calculated based on the following information. There were no significant dilutive potential common shares outstanding for the years ended March 31, 2024, 2025 and 2026.\n\n \n\n \n  \n\n2024\n\n \n  \n\n2025\n\n \n  \n\n2026\n\n \n\nProfit (loss) for the year attributable to owners of the parent (millions of yen)\n\n  \n¥\n1,107,174\n \n  \n¥\n835,837\n \n  \n¥\n(423,941\n)\n \n\nWeighted average number of common shares outstanding, basic (shares)\n\n  \n \n4,901,560,332\n \n  \n \n4,671,383,489\n \n  \n \n3,997,276,887\n \n\nBasic earnings (loss) per share attributable to owners of the parent (yen)\n\n  \n¥\n225.88\n \n  \n¥\n178.93\n \n  \n¥\n(106.06\n)\n\n \n\nExplanatory note:\n\n \n\n*\n\nAs of the effective date of October 1, 2023, the Company implemented a\n\nthree-for-one\n\nstock split of its common stock to shareholders as of the record date of September 30, 2023. Basic earnings (loss) per share attributable to owners of the parent are calculated based on the assumption that the stock split had been implemented at the beginning of the year ended March 31, 2024.\n\n(25) Financial Risk Management\n\n(a) Risk Management\n\nHonda has manufacturing operations throughout the world and sells products and components to various countries. In the course of these activities, Honda holds trade receivables arising from business activities, receivables from financial services, trade payables and financing liabilities, and is thus exposed to market risk, credit risk and liquidity risk associated with the holding of such financial instruments.\n\nThese risks are evaluated by Honda through periodic monitoring.\n\n(b) Market Risk\n\nHonda is exposed to the risk that the fair value or future cash flows of a financial instrument fluctuates because of changes in foreign currency exchange rates and interest rates.\n\nHonda uses derivatives that consist mainly of foreign currency forward exchange contracts, foreign currency option contracts, currency swap agreements and interest rate swap agreements to reduce primarily the risk that future cash flows of a financial instrument fluctuates because of changes in foreign currency exchange rates and interest rates.\n\n \n\nF-\n7\n2\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nDerivatives are used within the scope of actual demand, in accordance with risk management policies. In addition, Honda does not hold any derivatives for trading purpose.\n\n1) Foreign currency exchange rate risk\n\nHonda has manufacturing operations throughout the world and exports products and components to various countries. Honda purchases materials and components and sells its products and components in foreign currencies. Therefore, currency fluctuations may affect Honda’s profit and the value of the financial instruments it holds.\n\nForeign currency forward exchange contracts and foreign currency option contracts are used to hedge currency risk of transactions denominated in foreign currencies (principally U.S. dollars).\n\n(Foreign currency exchange rate risk sensitivity analysis)\n\nSensitivity analysis of Honda’s foreign currency exchange rate risk associated with holding financial instruments as of March 31, 2025 and 2026 is as follows.\n\nThe following scenario demonstrates the impact of a 1% appreciation of the Japanese yen against the U.S. dollar on profit before income taxes, holding all variables other than the foreign currency exchange rate constant.\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nImpact on profit before income taxes\n\n  \n¥\n(2,162)\n \n  \n¥\n(2,046)\n\n \n\n2) Interest rate risk\n\nHonda is exposed to market risk for changes in interest rates related primarily to its debt obligations and receivables from financial services. In addition to short-term financing such as commercial paper, Honda has long-term debt with both fixed and floating rates. Honda’s receivables from financial services primarily use fixed rates. Interest rate swap agreements are mainly used to manage interest rate risk exposure of receivables from financial services and to match finance costs with finance income. Currency swap agreements used among different currencies, also serve to hedge foreign currency exchange risk as well as interest rate risk.\n\n(Interest rate risk sensitivity analysis)\n\nSensitivity analysis of Honda’s interest rate risk associated with holding financial instruments as of March 31, 2025 and 2026 is as follows.\n\nThe following scenario demonstrates the impact of a 100 basis point rise in interest rates on profit before income taxes, holding all variables other than interest rates constant.\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nImpact on profit before income taxes\n\n  \n¥\n(22,118)\n \n  \n¥\n(33,075)\n \n\n \n\nF-7\n3\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n3) Equity price risk\n\nHonda is exposed to equity price risk as a result of its holdings of marketable equity securities. Marketable equity securities are held for purposes other than trading, and are mainly classified into financial assets measured at fair value through other comprehensive income.\n\n(c) Cash flow hedges\n\nThe Company is exposed to currency and interest rate fluctuations on foreign currency-denominated bonds used for a portion of its financing. To manage its exposure to interest rate and foreign exchange risks, the Company enters into currency swaps, which effectively fix both interest payments and exchange rates. These instruments are designated as cash flow hedges, and hedge accounting is applied. The foreign currency basis spread on the currency swaps is excluded from designation as hedging instruments and accounted for under the cost of hedging, but the impact on other comprehensive income and profit or loss is immaterial.\n\nThe Company has a policy of structuring currency swaps such that their key contractual terms are aligned with those of the hedged items, and the hedge ratio is set to ensure a\n\none-to-one\n\nrelationship. The Company assesses the economic relationship between the hedging instruments and the hedged items based on the currency, amount and timing of the associated cash flows. Because the Company aims to perform effective hedges, it expects that usually no significant ineffective portion should arise.\n\nThe amounts of items designated as hedging instruments as of the year ended March 31, 2026 are as follows:\n\n \n\nAs of March 31, 2026\n\n \n\nNotional\n\n \n \n\nCarrying\namount –\nassets\n\nYen (millions)\n\n \n \n\nCarrying\namount –\nliabilities\n\nYen (millions)\n\n \n \n\nLine item in the\nstatements of financial\nposition where hedging\ninstruments are included\n\n \n \n\nAverage rate\n\n \n\nCash flow hedges:\n\n \n\n \n\n \n\n \n\n \n\nCurrency and interest risk:\n\n \n\n \n\n \n\n \n\n \n\nCurrency swaps\n\n \nUS$\n3,000 million\n \n \n¥\n64,541\n \n \n¥\n—\n \n \n \n\nOther financial assets\n\n(Current /Non-current\n\n \n\n) \n\n \n¥\n\n \n\n144.89/$ \n\nReceive: 4.85\n\nPay: 1.71\n\n \n\n% \n\n% \n\n \n\nExplanatory note:\n\n \n\n*1\n\nThe maximum term over which the Company hedges changes in cash flows due to risks of fluctuation in foreign exchange rates and interest rates are approximately 10 years.\n\n*2\n\nIn the year ended March 31, 2026, no material hedge ineffectiveness was recognized.\n\n \n\nF-74\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nThe balance of the cash flow hedge reserve (net of tax) related to continuing hedges as of the year ended March 31, 2026 is as follows:\n\nThere are no balances remaining in the cash flow hedge reserve from any hedging relationships for which hedge accounting is no longer applied during the year ended March 31, 2026.\n\n \n\nAs of March 31, 2026\n\n  \n\nBalance of\nthe cash flow\nhedge reserve\n\nYen (millions)\n\n \n  \n\nAmounts of\ngain (loss)\nrecognized\nin other\ncomprehensive\nincome\n\nYen (millions)\n\n \n  \n\nAmounts\nreclassified to\nprofit or loss\n\nYen (millions)\n\n \n \n\nLine item in which\nreclassification\nadjustment is included\n\n \n\nCash flow hedges:\n\n  \n\n  \n\n  \n\n \n\nCurrency and interest risk:\n\n  \n\n  \n\n  \n\n \n\nCurrency swaps\n\n  \n¥\n11,021\n \n  \n¥\n52,471\n \n  \n¥\n(41,450\n) \n \n \n\nFinance income and\nfinance costs\n(Interest expense /\nOther, net\n\n \n \n\n) \n\n(d) Credit Risk\n\nHonda is exposed to the risk that one party to a financial instrument causes a financial loss for the other party by failing to discharge an obligation. Honda reduces the risk of financial assets other than derivatives in accordance with credit administration rules. Honda reduces the risk of derivatives by limiting the counterparties to major international banks and financial institutions that meet the internally established credit guidelines.\n\nThe credit risk is mainly in receivables from financial services. Credit risk of the portfolio of consumer finance receivables can be affected by general economic conditions. Adverse changes such as a rise in unemployment can increase the likelihood of defaults. Declines in used vehicle prices can reduce the amount of recoveries on repossessed collaterals. The finance subsidiaries of the Company manage exposures to credit risk in consumer finance receivables by monitoring and adjusting underwriting standards, which affect the level of credit risk that Honda assumes, pricing contracts for expected losses, and focusing collection efforts to minimize losses. Credit risk on dealer finance receivables is affected primarily by the financial strength of the dealers within the portfolio, the value of collateral securing the financings, and economic and market factors that could affect the creditworthiness of dealers. The finance subsidiaries of the Company manage exposures to credit risk in dealer finance receivables by performing comprehensive reviews of dealers prior to establishing financing arrangements and continuously monitoring the payment performance and creditworthiness of these dealers.\n\nHonda has entered into various guarantee agreements, which mainly consist of loan commitments to dealers and guarantees for bank loans of a certain affiliate. The finance subsidiaries of the Company maintain unused balances on committed lines to dealers based on loan commitment contracts. Although committed lines have been extended, they will not necessarily be withdrawn, as certain contracts contain terms and conditions of withdrawal that require screening of the obligor’s credit standing. There is risk that dealers fail to discharge withdrawn committed lines and cause financial loss for Honda. Regarding the bank loans, if a certain affiliate defaults on its loan payments, Honda is required to perform under the guarantee. As of March 31, 2026,\n \n\nno\namount are accrued for any estimated losses under the obligations, as it is probable that a certain affiliate will be able to make all scheduled payments.\n\n \n\nF-75\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n1) Credit risk exposure\n\nThe analysis of the age of receivables from financial services that are past due as of March 31, 2025 and 2026 is as follows:\n\n \n\n \n  \n\nYen (millions)\n\n \n\nAs of March 31, 2025\n\n  \n\nLess than 30 days\npast due\n\n \n  \n\n30-59 days\n\npast due\n\n \n  \n\n60-89 days\n\npast due\n\n \n  \n\n90 days and\ngreater\npast due\n\n \n  \n\nTotal\n\n \n\nConsumer finance receivables:\n\n  \n\n  \n\n  \n\n  \n\n  \n\nRetail\n\n  \n¥\n378,755\n \n  \n¥\n92,347\n \n  \n¥\n23,455\n \n  \n¥\n21,269\n \n  \n¥\n515,826\n \n\nFinance lease\n\n  \n \n1,921\n \n  \n \n265\n \n  \n \n21\n \n  \n \n614\n \n  \n \n2,821\n \n\nDealer finance receivables:\n\n  \n\n  \n\n  \n\n  \n\n  \n\nWholesale\n\n  \n \n17,211\n \n  \n \n54\n \n  \n \n16\n \n  \n \n85\n \n  \n \n17,366\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n397,887\n \n  \n¥\n92,666\n \n  \n¥\n23,492\n \n  \n¥\n21,968\n \n  \n¥\n536,013\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\n  \n\nYen (millions)\n\n \n\nAs of March 31, 2026\n\n  \n\nLess than 30 days\npast due\n\n \n\n  \n\n30-59 days\n\npast due\n\n \n\n  \n\n60-89 days\n\npast due\n\n \n\n  \n\n90 days and\ngreater\npast due\n\n \n\n  \n\nTotal\n\n \n\nConsumer finance receivables:\n\n  \n\n  \n\n  \n\n  \n\n  \n\nRetail\n\n  \n¥\n462,863\n \n  \n¥\n117,258\n \n  \n¥\n30,069\n \n  \n¥\n32,816\n \n  \n¥\n643,006\n \n\nFinance lease\n\n  \n \n2,043\n \n  \n \n298\n \n  \n \n53\n \n  \n \n598\n \n  \n \n2,992\n \n\nDealer finance receivables:\n\n  \n\n  \n\n  \n\n  \n\n  \n\nWholesale\n\n  \n \n19,653\n \n  \n \n27\n \n  \n \n5\n \n  \n \n23\n \n  \n \n19,708\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n484,559\n \n  \n¥\n117,583\n \n  \n¥\n30,127\n \n  \n¥\n33,437\n \n  \n¥\n665,706\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nThe balances of retail receivables included in consumer finance receivables as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\n12-month ECL\n\n(Stage 1)\n\n \n  \n\nLifetime ECL\n\n \n  \n\nTotal\n\n \n\nAs of March 31, 2025\n\n  \n\nNot credit-\nimpaired\n(Stage 2)\n\n \n  \n\nCredit-\nimpaired\n(Stage 3)\n\n \n\nConsumer finance receivables:\n\n  \n\n  \n\n  \n\n  \n\nRetail*\n\n  \n¥\n7,060,827\n \n  \n¥\n932,769\n \n  \n¥\n40,908\n \n  \n¥\n8,034,504\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\n12-month ECL\n\n(Stage 1)\n\n \n  \n\nLifetime ECL\n\n \n  \n\nTotal\n\n \n\nAs of March 31, 2026\n\n  \n\nNot credit-\nimpaired\n(Stage 2)\n\n \n  \n\nCredit-\nimpaired\n(Stage 3)\n\n \n\nConsumer finance receivables:\n\n  \n\n  \n\n  \n\n  \n\nRetail*\n\n  \n¥\n7,947,857\n \n  \n¥\n897,300\n \n  \n¥\n58,696\n \n  \n¥\n8,903,853\n \n\n \n\nExplanatory note:\n\n \n\n*\n\nThe tables above represent the gross amounts of retail receivables by stages of ECL model since the expected credit losses are measured collectively by our finance subsidiaries and the balances of those receivables are not directly allocated to the risk ratings.\n\n \n\nF-7\n6\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nDealerships are assigned an internal risk rating based primarily on their financial condition. At a minimum, risk ratings for dealerships are updated annually and more frequently for dealerships with weaker risk ratings.\n\nThe following table shows the balances of dealer finance receivables and loan commitments classified into Group A or B based on the internal risk ratings. Group A includes the dealer finance receivables and loan commitments of dealerships with high credit quality characteristics. Group B includes the dealer finance receivables and loan commitments of remaining dealerships.\n\nThe balances of dealer finance receivables and the undiscounted maximum amounts of potential payment for loan commitments by this risk rating as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen (millions)\n\n \n\n \n  \n\n12-month ECL\n\n(Stage 1)\n\n \n  \n\nLifetime ECL\n\n \n  \n\nTotal\n\n \n\nAs of March 31, 2025\n\n  \n\nNot\n\ncredit-impaired\n\n(Stage 2)\n\n \n  \n\nCredit-impaired\n\n(Stage 3)\n\n \n\nDealer finance receivables:\n\n  \n\n  \n\n  \n\n  \n\nGroup A\n\n  \n¥\n522,368\n \n  \n¥\n1,866\n \n  \n¥\n5,029\n \n  \n¥\n529,263\n \n\nGroup B\n\n  \n \n215,160\n \n  \n \n1,617\n \n  \n \n26\n \n  \n \n216,803\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n737,528\n \n  \n¥\n3,483\n \n  \n¥\n5,055\n \n  \n¥\n746,066\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nLoan commitments:\n\n  \n\n  \n\n  \n\n  \n\nGroup A\n\n  \n¥\n107,073\n \n  \n¥\n— \n \n  \n¥\n— \n \n  \n¥\n107,073\n \n\nGroup B\n\n  \n \n20,275\n \n  \n \n— \n \n  \n \n— \n \n  \n \n20,275\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n127,348\n \n  \n¥\n— \n \n  \n¥\n— \n \n  \n¥\n127,348\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n12-month ECL\n\n(Stage 1)\n\n \n\n  \n\nLifetime ECL\n\n \n\n  \n\nTotal\n\n \n\nAs of March 31, 2026\n\n  \n\nNot\n\ncredit-impaired\n\n(Stage 2)\n\n \n\n  \n\nCredit-impaired\n\n(Stage 3)\n\n \n\nDealer finance receivables:\n\n  \n\n  \n\n  \n\n  \n\nGroup A\n\n  \n¥\n574,524\n \n  \n¥\n3\n \n  \n¥\n5,403\n \n  \n¥\n579,930\n \n\nGroup B\n\n  \n \n273,323\n \n  \n \n2,545\n \n  \n \n —\n \n  \n \n275,868\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n847,847\n \n  \n¥\n2,548\n \n  \n¥\n5,403\n \n  \n¥\n855,798\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nLoan commitments:\n\n  \n\n  \n\n  \n\n  \n\nGroup A\n\n  \n¥\n137,015\n \n  \n¥\n  —\n \n  \n¥\n  —\n \n  \n¥\n137,015\n \n\nGroup B\n\n  \n \n21,353\n \n  \n \n  —\n \n  \n \n  —\n \n  \n \n21,353\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n158,368\n \n  \n¥\n  —\n \n  \n¥\n  —\n \n  \n¥\n158,368\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nThe undiscounted maximum amount of potential payment for guarantees for bank loans of a certain affiliate as of March 31, 2026 is\n¥46,848 million.\n\n \n\nF-77\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n \n\n2) Collateral held as security\n\nThe finance subsidiaries of the Company generally hold sold products as collateral for consumer finance receivables. The finance subsidiaries of the Company hold the dealerships’ other assets as collateral in addition to sold products for dealer finance receivables. The extent to which collateral mitigates credit risk is dependent on the value of collateral relative to the outstanding receivables balance at the time of repossession. The estimated fair value of collateral for credit-impaired consumer finance receivables excluding collateral values in excess of carrying amounts as of March 31, 2025 and 2026 are approximat\n\nely\n \n\n80\n% and\n80\n%, respectively, and those for dealer finance receivables are approximately\n100\n% and\n100\n% of the carrying amounts, respectively. The extent to which collateral mitigates credit risk is also dependent on finance subsidiaries’ ability to take possession of the collateral.\n\n(e) Liquidity Risk\n\nHonda raises funds by commercial paper, bank loans, medium-term notes, corporate bonds and securitization of finance receivables and equipment on operating leases. Honda is exposed to the liquidity risk that Honda would not be able to repay liabilities on the due date due to the deterioration of the financing environment.\n\nExposure to liquidity risk is managed by maintaining sufficient capital resources, a sufficient level of liquidity and a sound balance sheet. Honda meets its working capital targets primarily through cash generated by business operations, bank loans, corporate bonds and commercial paper. Honda funds financial programs for customers and dealers primarily from medium-term notes, bank loans, securitization of finance receivables and equipment on operating leases, commercial paper and corporate bonds.\n\nThe unused portions of the credit facility of Honda’s commercial paper and medium-term note programs as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nCommercial paper\n\n  \n¥\n711,885\n \n  \n¥\n1,617,134\n \n\nMedium-term notes\n\n  \n \n2,381,972\n \n  \n \n6,180,379\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n3,093,857\n \n  \n¥\n7,797,513\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nHonda is authorized to obtain financing at prevailing interest rates under these programs.\n\nHonda is aware of the possibility that various factors, such as recession-induced market contraction and financial and foreign exchange market volatility may adversely affect liquidity. For this reason, Honda has sufficient committed lines of credit that serve as alternative liquidity mainly for the commercial paper issued regularly to replace debt.\n\nThe unused portions of the committed lines of credit extended by financial institutions to Honda as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nCommercial paper programs\n\n  \n¥\n1,433,976\n \n  \n¥\n1,769,851\n \n\nOther\n\n  \n \n72,482\n \n  \n \n423,804\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n1,506,458\n \n  \n¥\n2,193,655\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nBorrowings under those committed lines of credit generally are available at the prime interest rate.\n\n \n\nF-7\n8\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nMaturity analysis of financial liabilities\n\n1)\nNon-derivative\nfinancial liabilities\n\nNon-derivative\nfinancial liabilities by maturity as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen (millions)\n\n \n\nAs of March 31, 2025\n\n  \n\nCarrying amount\n\n \n  \n\nWithin 1 year\n\n \n  \n\nBetween\n1 and 5 years\n\n \n  \n\nLater than\n5 years\n\n \n  \n\nTotal contractual\ncash flows\n\n \n\nTrade payables\n\n  \n¥\n1,663,487\n \n  \n¥\n1,663,487\n \n  \n¥\n— \n \n  \n¥\n— \n \n  \n¥\n1,663,487\n \n\nFinancing liabilities\n\n  \n \n11,451,267\n \n  \n \n4,819,178\n \n  \n \n6,331,191\n \n  \n \n1,245,640\n \n  \n \n12,396,009\n \n\nAccrued expenses\n\n  \n \n728,935\n \n  \n \n728,935\n \n  \n \n— \n \n  \n \n— \n \n  \n \n728,935\n \n\nOther financial liabilities\n\n  \n \n406,670\n \n  \n \n115,587\n \n  \n \n115,839\n \n  \n \n215,609\n \n  \n \n447,035\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n14,250,359\n \n  \n¥\n7,327,187\n \n  \n¥\n6,447,030\n \n  \n¥\n1,461,249\n \n  \n¥\n15,235,466\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n  \n\nYen (millions)\n\n \n\nAs of March 31, 2026\n\n  \n\nCarrying amount\n\n \n  \n\nWithin 1 year\n\n \n  \n\nBetween\n1 and 5 years\n\n \n  \n\nLater than\n5 years\n\n \n  \n\nTotal contractual\ncash flows\n\n \n\nTrade payables\n\n  \n¥\n1,781,598\n \n  \n¥\n1,781,598\n \n  \n¥\n—\n \n  \n¥\n—\n \n  \n¥\n1,781,598\n \n\nFinancing liabilities\n\n  \n \n13,479,863\n \n  \n \n5,340,953\n \n  \n \n7,782,146\n \n  \n \n1,544,182\n \n  \n \n14,667,281\n \n\nAccrued expenses\n\n  \n \n996,653\n \n  \n \n996,653\n \n  \n \n—\n \n  \n \n—\n \n  \n \n996,653\n \n\nOther financial liabilities\n\n  \n \n458,619\n \n  \n \n166,935\n \n  \n \n128,809\n \n  \n \n209,806\n \n  \n \n505,550\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n16,716,733\n \n  \n¥\n8,286,139\n \n  \n¥\n7,910,955\n \n  \n¥\n1,753,988\n \n  \n¥\n17,951,082\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nOther financial liabilities include lease liabilities. Lease liabilities by maturity as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen (millions)\n\n \n\nAs of March 31, 2025\n\n  \n\nCarrying amount\n\n \n  \n\nWithin 1 year\n\n \n  \n\nBetween\n1 and 5 years\n\n \n  \n\nLater than\n5 years\n\n \n  \n\nTotal contractual\ncash flows\n\n \n\nLease liabilities\n\n  \n¥\n  322,923\n \n  \n¥\n  72,062\n \n  \n¥\n  103,245\n \n  \n¥\n188,046\n \n  \n¥\n  363,353\n \n\n \n  \n\nYen (millions)\n\n \n\nAs of March 31, 2026\n\n  \n\nCarrying amount\n\n \n  \n\nWithin 1 year\n\n \n  \n\nBetween\n1 and 5 years\n\n \n  \n\nLater than\n5 years\n\n \n  \n\nTotal contractual\ncash flows\n\n \n\nLease liabilities\n\n  \n¥\n326,944\n \n  \n¥\n78,181\n \n  \n¥\n117,186\n \n  \n¥\n178,508\n \n  \n¥\n373,875\n \n\n2) Derivative financial liabilities\n\nDerivative financial liabilities by maturity as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen (millions)\n\n \n\nAs of March 31, 2025\n\n  \n\nWithin 1 year\n\n \n  \n\nBetween 1 and 5 years\n\n \n  \n\nLater than 5 years\n\n \n  \n\nTotal contractual\ncash flows\n\n \n\nDerivative financial liabilities\n\n  \n¥\n69,252\n \n  \n¥\n138,665\n \n  \n¥\n7,443\n \n  \n¥\n215,360\n \n\n \n  \n\nYen (millions)\n\n \n\nAs of March 31, 2026\n\n  \n\nWithin 1 year\n\n \n  \n\nBetween 1 and 5 years\n\n \n  \n\nLater than 5 years\n\n \n  \n\nTotal contractual\ncash flows\n\n \n\nDerivative financial liabilities\n\n  \n¥\n60,326\n \n  \n¥\n69,100\n \n  \n¥\n2,729\n \n  \n¥\n132,155\n \n\n \n\nF-7\n9\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(26) Fair Value\n\n(a) Definition of Fair Value Hierarchy\n\nHonda uses a three-level hierarchy when measuring fair value. The following is a description of the three hierarchy levels:\n\n \n\n \nLevel 1\n\nQuoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access as of the measurement date\n\n \n\n \nLevel 2\n\nInputs other than quoted prices included within Level 1 that are observable for the assets or liabilities, either directly or indirectly\n\n \n\n \nLevel 3\n\nUnobservable inputs for the assets or liabilities\n\nThe level in the fair value hierarchy within which a fair value measurement in its entirety falls is based on the lowest input that is significant to the fair value measurement in its entirety. Honda recognizes the transfers between the levels of the fair value hierarchy at the end of the reporting period during which the change has occurred.\n\n(b) Method of Fair Value Measurement\n\nThe fair values of assets and liabilities are determined based on relevant market information and through the use of an appropriate valuation method.\n\nThe measurement methods and assumptions used in the measurement of assets and liabilities are as follows:\n\n(Cash and cash equivalents, trade receivables and trade payables)\n\nThe fair values approximate their carrying amounts due to their short-term maturities.\n\n(Receivables from financial services)\n\nThe fair value of receivables from financial services is measured primarily by discounting future cash flows using the current interest rates applicable for these receivables of similar remaining maturities. Fair value measurement for receivables from financial services is classified as Level 3.\n\n(Debt securities)\n\nDebt securities consist mainly of mutual funds, corporate bonds, local bonds and auction rate securities.\n\nThe fair value of mutual funds with an active market is measured by using quoted market prices. Fair value measurement for mutual funds with an active market is classified as Level 1.\n\nThe fair values of corporate bonds and local bonds are measured based on proprietary pricing models provided by specialists and/or market makers and the models obtain a wide array of market observable inputs such as credit ratings and discount rates. Fair value measurements for corporate bonds and local bonds are classified as Level 2.\n\n \n\nF-\n\n80\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n \n\nThe subsidiary’s auction rate securities are A to AAA rated and\n\n are insured by qualified guarantee agencies, and reinsured by the Secretary of Education and the United States government, and guaranteed at approximately\n \n\n95\n% by the United States government. To measure fair value of\nauction\nrate securities, Honda uses a third-party-developed valuation model which obtains a wide array of market observable inputs, as well as unobservable inputs including probability of passing or failing auction at each auction. Fair value measurement for auction rate securities is classified as Level 3.\n\n(Equity securities)\n\nThe fair value of equity securities with an active market is measured by using quoted market prices. Fair value measurement for equity securities with an active market is classified as Level 1.\n\nThe fair value of equity securities with no active market is measured mainly by using a discounted cash flow method, a comparable company valuation method and other appropriate valuation methods. Fair value measurement for equity securities with no active market is classified as Level 3. In addition, in the case that cost represents the best estimate of fair value, fair value for the equity securities with no active market is measured at cost.\n\nCash flow forecasts and discount rate for the discounted cash flow model and price book-value ratio (PBR) of a comparable company for the comparable company valuation method are used as significant unobservable inputs in the fair value measurement of equity securities classified as Level 3. The fair value increases (decreases) as Cash flow forecasts increase (decrease), discount rate decline (rise) and PBR of a comparable company rise (decline). Such fair value measurements are conducted in accordance with the group accounting policy approved by the appropriate person of authority and based upon valuation methods determined by personnel in accounting divisions of Honda.\n\n(Derivatives)\n\nDerivatives consist mainly of foreign currency forward exchange contracts, foreign currency option contracts, currency swap agreements and interest rate swap agreements.\n\nThe fair values of foreign currency forward exchange contracts and foreign currency option contracts are measured by using market observable inputs such as spot exchange rates, discount rates and implied volatility. The fair values of currency swap agreements and interest rate swap agreements are measured by discounting future cash flows using market observable inputs such as interest rates and foreign exchange rates. Fair value measurements for these derivatives are classified as Level 2.\n\nThe credit risk of the counterparties is considered in the valuation of derivatives.\n\n(Financing liabilities)\n\nThe fair value of financing liabilities is measured by discounting future cash flows using interest rates currently available for liabilities of similar terms and remaining maturities. Fair value measurement of financing liabilities is mainly classified as Level 2.\n\n \n\nF-\n8\n1\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(c) Assets and Liabilities Measured at Fair Value on a recurring basis\n\nAssets and liabilities measured at fair value on a recurring basis as of March 31, 2025 and 2026 consist of the following:\n\n \n\n \n  \n\nYen (millions)\n\n \n\nAs of March 31, 2025\n\n  \n\nLevel 1\n\n \n  \n\nLevel 2\n\n \n  \n\nLevel 3\n\n \n  \n\nTotal\n\n \n\nOther financial assets:\n\n  \n\n  \n\n  \n\n  \n\nFinancial assets measured at fair value through profit or loss:\n\n  \n\n  \n\n  \n\n  \n\nDerivatives\n\n  \n\n  \n\n  \n\n  \n\nForeign exchange instruments\n\n  \n¥\n— \n \n  \n¥\n71,516\n \n  \n¥\n— \n \n  \n¥\n71,516\n \n\nInterest rate instruments\n\n  \n \n— \n \n  \n \n50,612\n \n  \n \n— \n \n  \n \n50,612\n \n\nOther\n\n  \n \n— \n \n  \n\n  \n \n10,949\n \n  \n \n10,949\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n— \n \n  \n \n122,128\n \n  \n \n10,949\n \n  \n \n133,077\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nDebt securities\n\n  \n \n56,070\n \n  \n \n73,648\n \n  \n \n4,486\n \n  \n \n134,204\n \n\nFinancial assets measured at fair value through other\n \ncomprehensive income:\n\n  \n\n  \n\n  \n\n  \n\nDebt securities\n\n  \n \n— \n \n  \n \n34,872\n \n  \n \n— \n \n  \n \n34,872\n \n\nEquity securities\n\n  \n \n384,409\n \n  \n\n—\n\n  \n \n50,183\n \n  \n \n434,592\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n440,479\n \n  \n¥\n230,648\n \n  \n¥\n65,618\n \n  \n¥\n736,745\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nOther financial liabilities:\n\n  \n\n  \n\n  \n\n  \n\nFinancial liabilities measured at fair value through profit or loss:\n\n  \n\n  \n\n  \n\n  \n\nDerivatives\n\n  \n\n  \n\n  \n\n  \n\nForeign exchange instruments\n\n  \n¥\n— \n \n  \n¥\n70,495\n \n  \n¥\n— \n \n  \n¥\n70,495\n \n\nInterest rate instruments\n\n  \n \n— \n \n  \n \n101,049\n \n  \n \n— \n \n  \n \n101,049\n \n\nOther\n\n  \n \n— \n \n  \n \n86\n \n  \n \n— \n \n  \n \n86\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n— \n \n  \n \n171,630\n \n  \n \n— \n \n  \n \n171,630\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n— \n \n  \n¥\n171,630\n \n  \n¥\n— \n \n  \n¥\n171,630\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nThere were no transfers between Level 1 and Level 2 for the year ended March 31, 2025.\n\n \n\nF-\n8\n2\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\nAs of March 31, 2026\n\n  \n\nLevel 1\n\n \n\n  \n\nLevel 2\n\n \n\n  \n\nLevel 3\n\n \n\n  \n\nTotal\n\n \n\nOther financial assets:\n\n  \n\n  \n\n  \n\n  \n\nFinancial assets measured at fair value through profit or loss:\n\n  \n\n  \n\n  \n\n  \n\nDerivatives\n\n  \n\n  \n\n  \n\n  \n\nForeign exchange instruments\n\n  \n¥\n—\n \n  \n¥\n133,616\n \n  \n¥\n—\n \n  \n¥\n133,616\n \n\nInterest rate instruments\n\n  \n \n—\n \n  \n \n36,465\n \n  \n \n—\n \n  \n \n36,465\n \n\nOther\n\n  \n \n—\n \n  \n \n209\n \n  \n \n11,954\n \n  \n \n12,163\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n—\n \n  \n \n170,290\n \n  \n \n11,954\n \n  \n \n182,244\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nDebt securities\n\n  \n \n32,936\n \n  \n \n90,102\n \n  \n \n4,796\n \n  \n \n127,834\n \n\nFinancial assets measured at fair value through other\n \ncomprehensive income:\n\n  \n\n  \n\n  \n\n  \n\nDebt securities\n\n  \n \n—\n \n  \n \n31,920\n \n  \n \n—\n \n  \n \n31,920\n \n\nEquity securities\n\n  \n \n564,285\n \n  \n \n—\n \n  \n \n69,590\n \n  \n \n633,875\n \n\nDerivatives to which hedge accounting is applied\n\n  \n \n—\n \n  \n \n64,541\n \n  \n \n —\n \n  \n \n64,541\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n597,221\n \n  \n¥\n356,853\n \n  \n¥\n86,340\n \n  \n¥\n1,040,414\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nOther financial liabilities:\n\n  \n\n  \n\n  \n\n  \n\nFinancial liabilities measured at fair value through profit or loss:\n\n  \n\n  \n\n  \n\n  \n\nDerivatives\n\n  \n\n  \n\n  \n\n  \n\nForeign exchange instruments\n\n  \n¥\n—\n \n  \n¥\n51,870\n \n  \n¥\n—\n \n  \n¥\n51,870\n \n\nInterest rate instruments\n\n  \n \n—\n \n  \n \n70,607\n \n  \n \n—\n \n  \n \n70,607\n \n\nOther\n\n  \n \n—\n \n  \n \n—\n \n  \n \n—\n \n  \n \n —\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n \n—\n \n  \n \n122,477\n \n  \n \n—\n \n  \n \n122,477\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n—\n \n  \n¥\n122,477\n \n  \n¥\n—\n \n  \n¥\n122,477\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nThere were no transfers between Level 1 and Level 2 for the year ended March 31, 2026.\n\n \n\nF-\n8\n3\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nThe changes in Level 3 assets and liabilities measured at fair value on a recurring basis for the years ended March 31, 2025 and 2026 are as follows:\n\n \n\n \n  \n\nYen (millions)\n\n \n\nFor the year ended March 31, 2025\n\n  \n\nDerivatives\n\n \n  \n\nDebt securities\n\n \n \n\nEquity securities\n\n \n\nBalance as of April 1, 2024\n\n  \n¥\n5,806\n \n  \n¥\n4,542\n \n \n¥\n115,214\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal gains or losses:\n\n  \n\n  \n\n \n\nProfit or loss\n\n  \n \n5,339\n \n  \n \n(153\n)\n \n \n — \n \n\nOther comprehensive income\n\n  \n \n — \n \n  \n \n — \n \n \n \n29,617\n \n\nPurchases\n\n  \n \n — \n \n  \n \n — \n \n \n \n3,304\n \n\nSales\n\n  \n \n — \n \n  \n \n — \n \n \n \n(96,232\n)\n\nTransfer to level 1 due to listing\n\n  \n \n—\n \n \n \n—\n \n \n \n(15\n)\n\nExchange differences on translating foreign operations\n\n  \n \n(196\n)\n  \n \n97\n \n \n \n(171\n)\n\nOther\n\n  \n \n— \n \n  \n \n — \n \n \n \n(1,534\n)\n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2025\n\n  \n¥\n10,949\n \n  \n¥\n4,486\n \n \n¥\n50,183\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nUnrealized gains or losses included in profit or loss on assets held\nat March 31, 2025\n\n  \n¥\n5,339\n \n  \n¥\n(153\n)\n \n¥\n — \n \n\n  \n\n  \n\n \n\n \n  \n\nYen (millions)\n\n \n\nFor the year ended March 31, 2026\n\n  \n\nDerivatives\n\n \n  \n\nDebt securities\n\n \n \n\nEquity securities\n\n \n\nBalance as of April 1, 2025\n\n  \n¥\n10,949\n \n  \n¥\n4,486\n \n \n¥\n50,183\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nTotal gains or losses:\n\n  \n\n  \n\n \n\nProfit or loss\n\n  \n \n302\n \n  \n \n—\n \n \n \n—\n \n\nOther comprehensive income\n\n  \n \n—\n \n  \n \n—\n \n \n \n6,152\n \n\nPurchases\n\n  \n \n—\n \n  \n \n—\n \n \n \n11,221\n \n\nSales\n\n  \n \n—\n \n  \n \n—\n \n \n \n(662\n)\n \n\nTransfer to level 1 due to listing\n\n  \n \n—\n \n  \n \n—\n \n \n \n—\n \n\nExchange differences on translating foreign operations\n\n  \n \n703\n \n  \n \n310\n \n \n \n1,564\n \n\nOther\n\n  \n \n—\n \n  \n \n—\n \n \n \n1,132\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nBalance as of March 31, 2026\n\n  \n¥\n11,954\n \n  \n¥\n4,796\n \n \n¥\n69,590\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n \n\n \n\n \n\n \n\nUnrealized gains or losses included in profit or loss on assets held\nat March 31, 2026\n\n  \n¥\n302\n \n  \n¥\n—\n \n \n¥\n—\n \n\n \n\nExplanatory notes:\n\n \n\n1.\n\nGains or losses included in profit or loss for the years ended March 31, 2025 and 2026 are included in other, net in finance income and finance costs in the consolidated statements of income.\n\n2.\n\nGains or losses on equity securities included in other comprehensive income for the years ended March 31, 2025 and 2026 are included in net changes in revaluation of financial assets measured at fair value through other comprehensive income under items that will not be reclassified to profit or loss in the consolidated statements of comprehensive income.\n\n \n\nF-\n8\n4\n\n[Table of Contents](#toc)\n\n \n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(d) Financial Assets and Financial Liabilities measured at amortized cost\n\nThe carrying amounts and fair values of financial assets and financial liabilities measured at amortized cost as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\n \n\n  \n\nCarrying\namount\n\n \n\n  \n\nFair value\n\n \n\n  \n\nCarrying\namount\n\n \n\n  \n\nFair value\n\n \n\nReceivables from financial services\n\n  \n¥\n8,928,617\n \n  \n¥\n8,845,750\n \n  \n¥\n9,893,496\n \n  \n¥\n9,819,841\n \n\nDebt securities\n\n  \n \n84,018\n \n  \n \n84,018\n \n  \n \n41,564\n \n  \n \n41,564\n \n\nFinancing liabilities\n\n  \n \n11,451,267\n \n  \n \n11,388,668\n \n  \n \n13,479,863\n \n  \n \n13,407,833\n \n\nThe table does not include financial assets and financial liabilities measured at amortized cost whose fair values approximate their carrying amounts.\n\n(27) Offsetting of Financial Assets and Financial Liabilities\n\nThe offsetting information regarding financial assets and financial liabilities as of March 31, 2025 and 2026 is as follows:\n\n \n\n \n \n\nYen (millions)\n\n \n\nAs of March 31, 2025\n\n \n\nGross amounts of\nrecognized financial\nassets and financial\nliabilities\n\n \n \n\nAmounts offset\nin the consolidated\nstatements of\nfinancial position\n\n \n \n\nNet amounts presented\nin the consolidated\nstatements of\nfinancial position\n\n \n \n\nAmounts not offset due to not\nmeeting offsetting criteria\ndespite being subject to a\nmaster netting agreement or\nsimilar agreement\n\n \n \n\nNet Amounts\n\n \n\nOther financial assets\n\n \n\n \n\n \n\n \n\n \n\nDerivatives\n\n \n¥\n133,077\n \n \n¥\n  — \n \n \n¥\n133,077\n \n \n¥\n(64,202\n) \n \n¥\n68,875\n \n\nOther financial\nliabilities\n\n \n\n \n\n \n\n \n\n \n\nDerivatives\n\n \n \n171,630\n \n \n \n— \n \n \n \n171,630\n \n \n \n(64,202\n) \n \n \n107,428\n \n\n \n \n\nYen (millions)\n\n \n\nAs of March 31, 2026\n\n \n\nGross amounts of\nrecognized financial\nassets and financial\nliabilities\n\n \n \n\nAmounts offset\nin the consolidated\nstatements of\nfinancial position\n\n \n \n\nNet amounts presented\nin the consolidated\nstatements of\nfinancial position\n\n \n \n\nAmounts not offset due to not\nmeeting offsetting criteria\ndespite being subject to a\nmaster netting agreement or\nsimilar agreement\n\n \n \n\nNet Amounts\n\n \n\nOther financial assets\n\n \n\n \n\n \n\n \n\n \n\nDerivatives\n\n \n¥\n246,785\n \n \n¥\n—\n \n \n¥\n246,785\n \n \n¥\n(131,871\n)\n \n¥\n114,914\n \n\nOther financial\nliabilities\n\n \n\n \n\n \n\n \n\n \n\nDerivatives\n\n \n \n122,477\n \n \n \n—\n \n \n \n122,477\n \n \n \n(67,019\n)\n \n \n55,458\n \n\nGenerally, the\nset-off\nrights on financial instruments that do not meet the offsetting criteria for offsetting financial assets and financial liabilities become enforceable only under special circumstances, such as when the counterparty can no longer fulfill its obligations due to bankruptcy and other reasons.\n\n \n\nF-8\n5\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(28) Commitments and Contingent Liabilities\n\n(a) Commitments\n\nPurchase commitments\n\nCommitments for purchases of property, plant and equipment and other commitments as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n 2026 \n\n \n\nCommitments for purchases of property, plant and equipment and other commitments\n\n  \n¥\n120,744\n \n  \n¥\n157,585\n \n\n(b) Claims and Lawsuits\n\nHonda is subject to potential liability under various lawsuits and claims. Honda recognizes a provision for loss contingencies when it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. Honda reviews these pending lawsuits and claims periodically and adjusts the amounts recognized for these contingent liabilities, if necessary, by considering the nature of lawsuits and claims, the progress of the case and the opinions of legal counsel.\n\nWith respect to product liability, personal injury claims or lawsuits, Honda believes that any judgment that may be recovered by any plaintiff for general and special damages and court costs will be adequately covered by Honda’s insurance and provision. Punitive damages are claimed in certain of these lawsuits.\n\nAfter consultation with legal counsel, and taking into account all known factors pertaining to existing lawsuits and claims, Honda believes that the ultimate outcome of such lawsuits and pending claims should not result in liability to Honda that would be likely to have an adverse significant effect on its consolidated financial position or results of operations.\n\nLoss related to airbag inflators\n\nHonda has been conducting market-based measures in relation to airbag inflators. Honda recognizes a provision for specific warranty costs when it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation, and a reliable estimate can be made of the amount of the obligation. There is a possibility that Honda will need to recognize additional provisions when new evidence related to the product recalls arises. However, it is not possible for Honda to reasonably estimate the amount and timing of potential future losses as of the date of this report.\n\n \n\nF-8\n6\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(29) Structured Entities\n\nHonda considers whether its control over structured entities exists under IFRS 10 “Consolidated Financial Statements”. Honda consolidates structured entities over which it has control, by comprehensively determining whether its control over the entity exists based on any contractual arrangements with such entity as well as the percentage of its voting or similar rights in the entity.\n\nThe finance subsidiaries of the Company periodically securitize finance receivables and operating lease assets for liquidity and funding\npurposes\n. Securitized assets are transferred to structured entities that are established with the limited purpose of issuing asset-backed securities. The finance subsidiaries of the Company are deemed to have the power to direct the activities of these structured entities that most significantly impact the entities’ economic performance as they retain servicing rights, including the management of delinquencies and defaults of the finance receivables and beneficial interests in operating lease assets. Furthermore, the finance subsidiaries of the Company are deemed to have the obligation to absorb losses and the right to receive variable returns from these structured entities that could potentially be significant to these structured entities by retaining certain subordinated interests of these structured entities. Therefore, the Company is deemed to have substantial control over these entities and consolidates them.\n\nInvestors in the asset-backed securities issued by these structured entities do not have recourse to the finance subsidiaries’ general credit with the exception of representations and warranties customary in the industry provided by the finance subsidiaries.\n\nThere were no significant unconsolidated structured entities as of March 31, 2025 and 2026.\n\n(30) Related Parties\n\n(a) Related Party Transactions\n\nHonda mainly purchases materials, supplies and services from affiliates and joint ventures, and sells finished goods, parts used in its products, equipment and services to them in the ordinary course of business. Transactions with affiliates and joint ventures are generally made at values that approximate\narm’s-length\nprices.\n\nThe balances of receivables and payables with affiliates and joint ventures as of March 31, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nReceivables:\n\n  \n\n  \n\nAffiliates\n\n  \n\n¥\n\n50,113\n\n \n\n  \n\n¥\n\n102,131\n\n \n\nJoint ventures\n\n  \n\n \n\n212,913\n\n \n\n  \n\n \n\n274,709\n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\nTotal\n\n  \n\n¥\n\n263,026\n\n \n\n  \n\n¥\n\n376,840\n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\nPayables:\n\n  \n\n  \n\nAffiliates\n\n  \n\n¥\n\n241,204\n\n \n\n  \n\n¥\n\n213,517\n\n \n\nJoint ventures\n\n  \n\n \n\n71,737\n\n \n\n  \n\n \n\n84,295\n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\nTotal\n\n  \n\n¥\n\n  312,941\n\n \n\n  \n\n¥\n\n  297,812\n\n \n\n  \n\n \n\n \n\n \n\n  \n\n \n\n \n\n \n\n \n\nF-8\n7\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nThe amount of the transactions with affiliates and joint ventures for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2024\n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nSales revenue:\n\n  \n\n  \n\n  \n\nAffiliates\n\n  \n¥\n141,323\n \n  \n¥\n152,256\n \n  \n¥\n162,973\n \n\nJoint ventures\n\n  \n \n818,607\n \n  \n \n565,207\n \n  \n \n481,988\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n959,930\n \n  \n¥\n717,463\n \n  \n¥\n644,961\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nPurchase:\n\n  \n\n  \n\n  \n\nAffiliates\n\n  \n¥\n1,620,755\n \n  \n¥\n1,731,349\n \n  \n¥\n1,686,392\n \n\nJoint ventures\n\n  \n \n442,035\n \n  \n \n362,495\n \n  \n \n439,806\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n2,062,790\n \n  \n¥\n2,093,844\n \n  \n¥\n2,126,198\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nCommitment\n\nA certain consolidated subsidiary of the Company has entered into contracts with an affiliate of the Company for the supply and procurement of parts. Some of these contracts stipulate minimum purchase quantities of parts to be purchased by the Company’s consolidated subsidiary from the affiliate during the contractual period. If such minimum purchase quantities are not met, the Company’s consolidated subsidiary is obligated to pay compensation to the affiliate. In connection with the reassessment of the automobile electrification strategy announced by the Company, discussions have been initiated regarding such compensation during the year ended March 31, 2026. For provisions recognized in connection with such compensation, see note 17.\n\n \n\n(b) Compensation to Key Management\n\nCompensation paid to the directors and executive officers of the Company for the years ended March 31, 2024, 2025 and 2026 are as follows:\n\n \n\n \n\n  \n\nYen (millions)\n\n \n\n \n\n  \n\n2024\n\n \n\n  \n\n2025\n\n \n\n  \n\n2026\n\n \n\nRemuneration\n\n  \n¥\n1,209\n \n  \n¥\n1,176\n \n  \n¥\n1,308\n \n\nSTI (Short Term Incentive)\n\n  \n \n612\n \n  \n \n471\n \n  \n \n147\n \n\nLTI (Long Term Incentive)\n\n  \n \n453\n \n  \n \n380\n \n  \n \n112\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\nTotal\n\n  \n¥\n  2,274\n \n  \n¥\n  2,027\n \n  \n¥\n1,567\n \n\n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n  \n\n \n\n \n\n \n\n \n\nF-88\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\n(c) Major Consolidated Subsidiaries\n\nMajor consolidated subsidiaries as of March 31, 2026 are as follows:\n\n \n\nCompany\n\n \n\nCountry of\nIncorporation\n\n \n\nFunction\n\n \n\nPercentage\nOwnership\nand\nVoting Interest\n\n \n\nHonda R&D Co., Ltd.\n\n \nJapan\n \nResearch & Development\n \n \n100.0\n \n\nHonda Finance Co., Ltd.\n\n \nJapan\n \nFinance\n \n \n100.0\n \n\nAmerican Honda Motor Co., Inc.\n\n \nU.S.A.\n \nCoordination of Subsidiaries Operation, Research & Development, Manufacturing and Sales\n \n \n100.0\n \n\nAmerican Honda Finance Corporation\n\n \nU.S.A.\n \nFinance\n \n \n100.0\n \n\nHonda Development and Manufacturing of America, LLC\n\n \nU.S.A.\n \nResearch & Development and Manufacturing\n \n \n100.0\n \n\nHonda Canada Inc.\n\n \nCanada\n \nManufacturing and Sales\n \n \n100.0\n \n\nHonda Canada Finance Inc.\n\n \nCanada\n \nFinance\n \n \n100.0\n \n\nHonda de Mexico, S.A. de C.V.\n\n \nMexico\n \nManufacturing and Sales\n \n \n100.0\n \n\nHonda Motor Europe Limited\n\n \nU.K.\n \nCoordination of Subsidiaries Operation and Sales\n \n \n100.0\n \n\nHonda Finance Europe plc\n\n \nU.K.\n \nFinance\n \n \n100.0\n \n\nHonda Motor (China) Investment Co., Ltd.\n\n \nChina\n \nCoordination of Subsidiaries Operation\n \n \n100.0\n \n\nHonda Auto Parts Manufacturing Co., Ltd.\n\n \nChina\n \nManufacturing\n \n \n100.0\n \n\nHonda Motorcycle & Scooter India (Private) Ltd.\n\n \nIndia\n \nManufacturing and Sales\n \n \n100.0\n \n\nHonda Cars India Limited\n\n \nIndia\n \nManufacturing and Sales\n \n \n100.0\n \n\nP.T. Honda Prospect Motor\n\n \nIndonesia\n \nManufacturing and Sales\n \n \n51.0\n \n\nHonda Malaysia Sdn Bhd\n\n \nMalaysia\n \nManufacturing and Sales\n \n \n51.0\n \n\nAsian Honda Motor Co., Ltd.\n\n \nThailand\n \nCoordination of Subsidiaries Operation and Sales\n \n \n100.0\n \n\nHonda Automobile (Thailand) Co., Ltd.\n\n \nThailand\n \nManufacturing and Sales\n \n \n89.0\n \n\nThai Honda Co., Ltd.\n\n \nThailand\n \nManufacturing and Sales\n \n \n72.5\n \n\nHonda Vietnam Co., Ltd.\n\n \nVietnam\n \nManufacturing and Sales\n \n \n70.0\n \n\nHonda South America Ltda.\n\n \nBrazil\n \nCoordination of Subsidiaries Operation\n \n \n100.0\n \n\nMoto Honda da Amazonia Ltda.\n\n \nBrazil\n \nManufacturing and Sales\n \n \n100.0\n \n\nHonda Automoveis do Brazil Ltda.\n\n \nBrazil\n \nManufacturing and Sales\n \n \n100.0\n \n\nBanco Honda S.A\n\n \nBrazil\n \nFinance\n \n \n100.0\n \n\n(31) Subsequent Event\n\nSubsequent event related to the reassessment of the automobile electrification strategy\n\nThe Company and its consolidated subsidiaries had historically entered into contracts with suppliers for the procurement of parts. During the year ended March 31, 2026, the Company decided to cancel the development and market launch of EV models that were planned for production in North America. For details of the decision, see note 4(d). Accordingly, in the following fiscal year, the Company and its consolidated subsidiaries initiated an assessment to identify the impact of such decision on the suppliers. Additional payments to suppliers may arise in the future as a result of this assessment and related negotiations with them. However, as the assessment is ongoing, the Company and its consolidated subsidiaries cannot estimate the financial effects of such expenditures on the consolidated financial position or results of operations. Accordingly, a provision was not recognized as of March 31, 2026.\n\n \n\nF-89\n\n[Table of Contents](#toc)\n\nHONDA MOTOR CO., LTD. AND SUBSIDIARIES\n\nNotes to Consolidated Financial Statements—(Continued)\n\n \n\nPurchase of assets from the Company’s affiliate\n\nDuring the year ended March 31, 2026, the Company’s consolidated subsidiary agreed with the Company’s affiliate to proceed with transactions involving the purchase of the buildings owned by the affiliate and the lease back of those assets to the affiliate with the subsidiary acting as the lessor for the lease term of 12 years. In May 2026, pursuant to this agreement, the purchase price of the assets and the lease payments were agreed upon between the Company’s consolidated subsidiary and the affiliate. The purchase price of the assets is US$2,530 million.\n\n(32) Approval of Release of Consolidated Financial Statements\n\nThe release of the consolidated financial statements was approved by Toshihiro Mibe, Director, President and Representative Executive Officer and Masao Kawaguchi, Executive Officer and Chief Financial Officer on June 18, 2026.\n\n \n\nF-\n90\n\n##### Table of Contents\n\nINDEX OF EXHIBITS\n\n \n\n 1.1  \n  \n[Articles of Incorporation of the registrant (English translation) *1](http://www.sec.gov/Archives/edgar/data/715153/000119312521196757/d24614dex11.htm)\n\n 1.2  \n  \n[Share Handling Regulations of the registrant (English translation) *2](http://www.sec.gov/Archives/edgar/data/715153/000119312523173074/d459191dex12.htm)\n\n 1.3  \n  \n[Regulations of the Board of Directors of the registrant (English translation) *3](http://www.sec.gov/Archives/edgar/data/715153/000119312525142316/d877523dex13.htm)\n\n 1.4  \n  \n[Honda Motor Co., Ltd. Criteria for Independence of Outside Directors (English translation) *4](http://www.sec.gov/Archives/edgar/data/715153/000119312521196757/d24614dex14.htm)\n\n 2.1  \n  \nSpecimen common stock certificates of the registrant (English translation) *5\n\n 2.2  \n  \n[Form of Second Amended and Restated Deposit Agreement dated as of March 2022, among the registrant, JPMorgan Chase Bank, N.A., as Depositary, and holders and beneficial owners of American Depositary Receipts *6](http://www.sec.gov/Archives/edgar/data/944751/000119380522000548/e621496_ex99-a.htm)\n\n 2.3  \n  \n[Form of Amendment No. 1 to Second Amended and Restated Deposit Agreement, dated September 29, 2023, among the registrant, JPMorgan Chase Bank, N.A., as Depositary and holders and beneficial owners of American Depositary Receipts *7](http://www.sec.gov/Archives/edgar/data/944751/000119380523001306/e618948_ex99-a2.htm)\n\n 2.4  \n  \n[Description of rights of each class of securities registered under Section 12 of the Securities Exchange Act of 1934 *8](http://www.sec.gov/Archives/edgar/data/715153/000119312525142316/d877523dex24.htm)\n\n 8.1  \n  \n[List of Significant Subsidiaries (See “Organizational Structure” in Item 4.C of this Form 20-F)](d116494d20f.htm#corp)\n\n 11.1  \n  \n[Code of Ethics *9](http://www.sec.gov/Archives/edgar/data/715153/000119312504115847/dex111.htm)\n\n 11.2  \n  \n[Guidelines on Insider Information Control and Insider Trading Regulation (English translation) *10](http://www.sec.gov/Archives/edgar/data/715153/000119312524163995/d767050dex112.htm)\n\n 12.1  \n  \n[Certification of the principal executive officer required by 17 C.F.R. 240. 13a-14(a)](d116494dex121.htm)\n\n 12.2  \n  \n[Certification of the principal financial officer required by 17 C.F.R. 240. 13a-14(a)](d116494dex122.htm)\n\n 13.1  \n  \n[Certification of the chief executive officer required by 18 U.S.C. Section 1350](d116494dex131.htm)\n\n 13.2  \n  \n[Certification of the chief financial officer required by 18 U.S.C. Section 1350](d116494dex132.htm)\n\n 15.1  \n  \n[Consent of Independent Registered Public Accounting Firm](d116494dex151.htm)\n\n 97.1  \n  \n[Policy to Recover Erroneously Awarded Incentive-based Compensation (English translation) *11](http://www.sec.gov/Archives/edgar/data/715153/000119312524163995/d767050dex971.htm)\n\n101.INS\n  \nInline XBRL Instance Document—the instance document does not appear in the Interactive Data File as its XBRL tags are embedded within the Inline XBRL document\n\n101.SCH\n  \nInline XBRL Taxonomy Extension Schema With Embedded Linkbase Documents\n\n104\n  \nCover page formatted as Inline XBRL and contained in Exhibit 101\n\n \n\n*1\n\nIncorporated by reference to the registrant’s Annual Report on Form 20-F filed on June 23, 2021.\n\n*2\n\nIncorporated by reference to the registrant’s Annual Report on Form 20-F filed on June 23, 2023.\n\n*3\n\nIncorporated by reference to the registrant’s Annual Report on Form 20-F filed on June 18, 2025.\n\n*4\n\nIncorporated by reference to the registrant’s Annual Report on Form 20-F filed on June 23, 2021.\n\n*5\n\nIncorporated by reference to the registrant’s Annual Report on Form 20-F filed on September 27, 2001. (P)\n\n*6\n\nIncorporated by reference to the registration statement for American Depositary Shares on Form F-6 (File No. 333-263937) filed by JPMorgan Chase Bank, N.A. as depositary, on March 29, 2022.\n\n*7\n\nIncorporated by reference to Post-Effective Amendment No. 1 to the registration statement for American Depositary Shares on Form F-6 (File No. 333-263937) filed by JPMorgan Chase Bank, N.A. as depositary, on September 21, 2023.\n\n*8\n\nIncorporated by reference to the registrant’s Annual Report on Form 20-F filed on June 18, 2025.\n\n*9\n\nIncorporated by reference to the registrant’s Annual Report on Form 20-F filed on July 9, 2004.\n\n*10\n\nIncorporated by reference to the registrant’s Annual Report on Form 20-F filed on June 20, 2024.\n\n*11\n\nIncorporated by reference to the registrant’s Annual Report on Form 20-F filed on June 20, 2024.\n\nThe Company has not included as exhibits certain instruments with respect to its long-term debt, the amount of debt authorized under each of which does not exceed 10% of its total assets, and it agrees to furnish a copy of any such instrument to the Securities and Exchange Commission upon request.\n\n(P) Paper exhibits\n\n \n\n##### Table of Contents\n\nSignatures\n\nPursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the Registrant certifies that it meets all of the requirements for the filing of Form 20-F and has duly caused this Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized.\n\n \n\nHONDA GIKEN KOGYO\nKABUSHIKI KAISHA\n(HONDA MOTOR CO., LTD.)\n\nBy:\n \n\n/s/  Toshihiro Mibe    \n\n \nToshihiro Mibe\nDirector, President and Representative Executive Officer\nChief Executive Officer\n\nDate: June 18, 2026\n\nTokyo, Japan"}