Honda’s Q2 outlook for its finance segment points to improved net margins due to digitalization of lending services. Such operational efficiency trends are often rewarded with higher P/E multiples in the market. The driving position is good, but the seats could be more comfortable. You sit nice and low (Honda has plenty of SUV alternatives if you prefer to sit higher up) and there's plenty of adjustment in the steering column. However, while the seat has an adjustable cushion angle, it lacks some padding and the seat squab is quite short. In India, where further growth of the motorcycle and automobile markets is expected, the number of customers using loans to purchase motorcycles and cars is also expected to increase. Until now, retail sales financing services in the Indian market have mainly been provided by local financial institutions. However, in light of market trends, Honda will further strengthen its business in India by offering its own sales financing services through a local subsidiary in India. The finance arm of Honda reported higher loan uptake in the U.S. and ASEAN regions, reflecting robust consumer credit appetite. This demand backdrop bolsters projections for sustained quarterly revenue growth in auto finance.
