NA Honda 09 A

Annual Report 2009
Honda Motor Co., Ltd.

Year Ended March 31, 2009
Contents
2 The Power of Dreams
3 Summary of Operating Results by Business
6 Financial Highlights
8 To Our Shareholders
18 Review of Operations
Motorcycle Business
Automobile Business
Power Product and Other Businesses
Financial Services Business
36 Preparing for the Future

37 Risk Factors
39 Corporate Governance
46 Board of Directors, Corporate Auditors and
Operating Officers
49 Financial Section
81 Corporate Information
Principal Manufacturing Facilities
Honda Group
Honda’s History
Investor Information
Reports Published by Honda
CSR Report
This report provides an overview of Honda’s position on corporate social responsibility
(CSR) activities and an overview of its performance in the areas of quality and safety, the
environment, and the society during the fiscal year ended March 31, 2009.
http://world.honda.com/CSR/
Driving Safety Promotion Report

This report (available only in Japanese) summarizes Honda’s efforts to promote safe driving
and principal activities in this area in 2008.
Annual Report
This report outlines Honda’s operating performance for the fiscal year ended March 31, 2009.
http://world.honda.com/investors/annualreport/
Environmental Report
This report describes Honda’s position on environmental initiatives, its environmental
performance for the fiscal year ended March 31, 2009, and future environmental targets.
http://world.honda.com/environment/ecology/2009report/
Cover:
Insight (right)
A five-passenger, five-door dedicated hybrid vehicle, all-new Insight has been very well
received by a wide range of customers due to an affordable price with exceptional fuel
economy, fun-to-drive performance and efficient versatile packaging and featuring the
Ecological Drive Assist System (Eco Assist) that can further enhance efficient vehicle
operation while providing feedback related to individual driving styles.
FCX Clarity (Center)
Designed as a dedicated fuel cell vehicle, the FCX Clarity is powered by the Honda V Flow
fuel cell stack. Thanks to the innovative layout of the fuel cell power plant, the FCX Clarity
offers superior design, packaging and driving performance. Emitting no CO2 in operation, the
FCX Clarity offers not only the ultimate in environmental responsibility but also real world
performance and appeal.
CR-Z (left)
The compact sports concept of a lightweight hybrid sports car that demonstrates the
flexibility of the unique Honda IMA hybrid system and features advanced technologies that
deliver enjoyable driving for all while offering superior environmental performance.
Corporate Profile
Honda Motor Co., Ltd., operates under the basic principles of
“Respect for the Individual” and “The Three Joys”—expressed as
“The Joy of Buying,” “The Joy of Selling”, and “The Joy of Creating.”
“Respect for the Individual” reflects our desire to respect the unique
character and ability of each individual person, trusting each other
as equal partners in order to do our best in every situation. Based
on this, “The Three Joys” express our belief and desire that each
person working in or coming into contact with our company,
directly or through our products, should share a sense of joy
through that experience.
In line with these basic principles, since its establishment in 1948,
Honda has remained on the leading edge by creating new value
and providing products of the highest quality at a reasonable price,
for worldwide customer satisfaction. In addition, the Company has
conducted its activities with a commitment to protecting the
environment and enhancing safety in a mobile society.
The Company has grown to become the world’s largest
motorcycle manufacturer and one of the leading automakers. With
a global network of 396* subsidiaries and 105* affiliates accounted
for under the equity method, Honda develops, manufactures, and
markets a wide variety of products, ranging from small general-
purpose engines and scooters to specialty sports cars, to earn the
Company an outstanding reputation from customers worldwide.
*As of March 31, 2009
Caution with Respect to Forward-Looking Statements

This annual report contains “forward-looking statements” as defined in Section 27A of the Securities Act of 1933, as amended, and Section 21E of the Securities Exchange
Act of 1934, as amended. Such statements are based on management’s assumptions and beliefs, taking into account information currently available to it. Therefore, please
be advised that Honda’s actual results could differ materially from those described in these forward-looking statements as a result of numerous factors, including general
economic conditions in Honda’s principal markets; foreign exchange rates between the Japanese yen and the U.S. dollar, the Euro, and other major currencies; and
extensive environmental and other governmental regulations, as well as other factors detailed from time to time.
Annual Report 2009 1

The Power of Dreams
Dreams inspire us to create innovative products that enhance mobility and benefit society. To
meet the particular needs of customers in different regions around the world, we base our sales
networks, research & development centers, and manufacturing facilities in each region.
Furthermore, as a socially responsible corporate citizen, we strive to address important
environmental and safety issues.
2 Annual Report 2009

15
Summary of Operating Results by Business
Percentage of Net Sales by Business
Motorcycle Business
14.1%
Automobile Business
76.7%
3.4%
5.8%

Brazil
50 50
0 0
05 06 07 08 09
Net
Yen Sales/Operating
(billions) Income
Yen(Loss)
(billions) Unit Sales by Region (Thousands)
1,600
Years
Yen ended March 31
(billions) 160
Yen (billions) Years ended March 31
1,411
1,600
Yen Net Sales (left scale)
(billions) Operating Yen
Income 160
(right scale)
(billions) 2007 2008 7,5232009
1,600
1,200 160
120
1,411 8,000
Yen (billions) Yen (billions) 7,523
1,600
1,200 160
120
1,411 99 8,000
7,523
1,200 120
1,411 99 8,000
800 80
1,200
800 120
80
99
800 80 99
400 40
1,763
800
400 80
40
1,763
232 320 276
400
0 40
0
1,763
05 06 07 08 09 Japan
232 320 Europe
North 276 Asia Other
400
0 40
0 America Regions CZ-i 110
05 06 07 08 09 Japan 320
232 North Europe
276 Asia Other
0 0 America Regions
05 06 07 08 09Yen (billions) Japan North Europe Asia Other
Yen (billions)
0 0 America Regions
Yen (billions)05
10,000 06 07 08 1,000
09Yen (billions)
10,000
Yen (billions) 1,000
Yen (billions)
10,000
7,500 1,000
750
7,674 2,000
Yen (billions) Yen (billions)
10,000
7,500 1,000
750
7,674 1,496 2,000
7,500 750
7,674 1,496 2,000
5,000 500
7,674 1,496
7,500
5,000 750
500 793
5,000
2,500 500
250 556 793
556 350 322
5,000
2,500 500
250 793
24 Insight
556 350 322
2,500
0 250
0 24
05 06 07 08 09 Japan North 350
Europe Asia Other
322
2,500
0 250
0 24America Regions
05 06 07 08 09 Japan North Europe Asia Other
0 0 24America Regions
Japan North Europe Asia Other
Yen (billions)05
0
06 07 08 09Yen (billions)
0 America Regions
(billions)05
Yen400 06 07 08 80
09Yen (billions)
Yen400
(billions) 80
Yen (billions)
300 60 4,000
Yen400
(billions) 80
Yen (billions)
300
400
60
80
343
4,000
200
300
40
60
343
4,000
200 40 343
300 60 1,893
100 20
200 40 343
-15 1,893 1,306
100 20
200 40 970
0 0 -15 1,893 1,306
100 20 516 970 502
0 0 -15 1,306 Pianta FV200
100 20 516 502
-100 -20 970
0 0
05 06 07 08 09 Japan -15North Europe Asia Other
-100 -20 516 America 502
Regions
0 0 Japan North Europe Asia Other
05 06 07 08 09
-100 -20 America Regions
Japan North Europe Asia Other
Yen (billions)05
-100
06 07 08 09Yen (billions)
-20 America Regions
Location 582
(billions)05
Yen600 06 07 08 200
09Yen (billions)
582
Yen600
(billions) 200
Yen (billions)
600 200 582

Yen450
(billions) 150
Yen (billions)
Germany Canada
600
450 200
150 582
U.K.
Germany Canada
450
300 150
100 U.K. U.S.A.
80
Germany Japan Canada
Thailand
450
300 150
100 U.K. U.S.A.
80 Japan
Thailand
300
150 100
50 U.S.A. Brazil
80 Japan
Thailand
300
150 100
50 Brazil
80
150
0 50
0 Brazil
150
05 06 07 08 09 50
0 0
05 06 07 08 09
0 0
05 06 07 08 09
0 0
05 06 07 08 09
Net Sales (left scale) Operating Income (right scale)
Summary of Operating Results by Business
Motorcycle Business
Automobile Business

Financial Highlights
Financial Data
Honda Motor Co., Ltd., and Subsidiaries
Years ended March 31
Yen U.S. dollars
(millions except per share data) (millions except per share data)
2007 2008 2009 2009
Net sales and other operating revenue ¥11,087,140 ¥12,002,834 ¥10,011,241 $101,916
Operating income 851,879 953,109 189,643 1,931
Income before income taxes, minority interest and
792,868 895,841 161,734 1,646
equity in income of affiliates
Equity in income of affiliates 103,417 118,942 99,034 1,008
Net income 592,322 600,039 137,005 1,395
Cash dividends paid during the period 140,482 152,590 139,724 1,422
Research and development 551,847 587,959 563,197 5,733
Total assets 12,036,500 12,615,543 11,818,917 120,319
Stockholders’ equity 4,488,825 4,550,479 4,007,288 40,795
Capital expenditures 627,066 654,030 633,913 6,453
(excluding purchase of operating lease assets)
Depreciation 361,747 417,393 441,868 4,498
(excluding property on operating leases)
Per share data
Net income ¥ 324.62 ¥ 330.54 ¥ 75.50 $ 0.77
Dividends paid 77 84 77 0.78
Stockholders’ equity 2,463.69 2,507.79 2,208.35 22.48
Note: The consolidated financial statements as of and for the year ended March 31, 2009, have been translated into U.S. dollars at the rate of ¥98.23=U.S.$1, the approximate exchange rate prevailing on the Tokyo
Foreign Exchange Market on March 31, 2009. Those U.S. dollar amounts presented in the consolidated financial statements and related notes are included solely for the reader. This translation should not be
construed as a representation that all the amounts shown could be converted into U.S. dollars.
Net Sales and Other Operating Revenue Operating Income and Operating Margin Equity in Income of Affiliates
Yen (billions) Yen (billions) (%) Yen (billions)
12,000 1,000 10.0 120
10,000 100
750 7.5
8,000 80
6,000 500 5.0 60
4,000 40
250 2.5
2,000 20
0 0 0 0
05 06 07 08 09 05 06 07 08 09 05 06 07 08 09
Operating Income (left scale)
Operating Margin (right scale)
Net Income and Return on Equity (ROE) Total Assets, Stockholders’ Equity, and Capital Expenditures and Depreciation
Stockholders’ Equity per Common Share (Excluding Property on Operating Leases)
Yen (billions) (%) Yen (billions) （Yen） Yen (billions)
600 20.0 12,500 2,500 600
10,000 2,000
450 15.0
400
7,500 1,500
300 10.0
5,000 1,000
200
150 5.0
2,500 500
0 0 0 0 0
05 06 07 08 09 05 06 07 08 09 05 06 07 08 09
Net Income (left scale) Total Assets (left scale) Capital Expenditures
ROE (right scale) Stockholders’ Equity (left scale) Depreciation
Stockholders’ Equity per Common Share (right scale)

Operating Data
Unit Sales Motorcycles Automobiles Power Products

Breakdown
(Thousands) 2008 2009 Change 2008 2009 Change 2008 2009 Change
Japan 311 232 (25.4) % 615 556 (9.6)% 550 516 (6.2) %
North America 453 320 (29.4) 1,850 1,496 (19.1) 2,415 1,893 (21.6)
Europe 313 276 (11.8) 391 350 (10.5) 1,693 1,306 (22.9)
Asia 6,633 7,523 13.4 755 793 5.0 915 970 6.0
Other Regions 1,610 1,763 9.5 314 322 2.5 484 502 3.7
Total 9,320 10,114 8.5 % 3,925 3,517 (10.4)% 6,057 5,187 (14.4) %
Power Product and Other

Net Sales Motorcycle Business Automobile Business Financial Services Business
Businesses
Breakdown
Yen (millions) 2008 2009 Change 2008 2009 Change 2008 2009 Change 2008 2009 Change
Japan ¥ 93,592 ¥ 81,822 (12.6) % ¥1,321,005 ¥1,225,384 (7.2) % ¥ 23,405 ¥ 24,083 2.9 % ¥147,775 ¥115,252 (22.0)%
North America 265,609 182,284 (31.4) 5,209,446 3,723,877 (28.5) 483,925 527,905 9.1 109,445 80,124 (26.8)
Europe 226,687 178,621 (21.2) 1,182,666 923,580 (21.9) 13,234 12,685 (4.1) 96,847 71,126 (26.6)
Asia 484,418 460,412 (5.0) 1,048,463 1,079,585 3.0 4,936 4,736 (4.1) 39,449 50,739 28.6
Other Regions 488,390 508,372 4.1 727,811 721,978 (0.8) 8,053 12,852 59.6 27,678 25,824 (6.7)
Total ¥1,558,696 ¥1,411,511 (9.4) % ¥9,489,391 ¥7,674,404 (19.1) % ¥533,553 ¥582,261 9.1 % ¥421,194 ¥343,065 (18.5)%
Unit Sales
Motorcycles Automobiles Power Products
(Thousands) (Thousands) (Thousands)
12,000 4,000 8,000
10,000
3,000 6,000
8,000
6,000 2,000 4,000
4,000
1,000 2,000
2,000
0 0 0
05 06 07 08 09 05 06 07 08 09 05 06 07 08 09
Japan North America Europe Asia Other Regions
Net Sales
Motorcycle Business Automobile Business Financial Services Business Power Product and Other Businesses
Yen (billions) Yen (billions) Yen (billions) Yen (billions)
2,000 10,000 600 500
500
8,000 400
1,500
400
6,000 300
1,000 300
4,000 200
200
500
2,000 100
100
0 0 0 0
05 06 07 08 09 05 06 07 08 09 05 06 07 08 09 05 06 07 08 09

To Our Shareholders
Takanobu Ito
President & Chief Executive Officer

We would like to express our gratitude to you, our shareholders, for your
ongoing support. We would also like to thank the many people who have
supported Honda’s long-term growth, including, first and foremost, our
customers as well as our business partners and the societies around the
world where we are privileged to do business.
Business Environment
Concerning the economic environment surrounding Honda during the fiscal
year ended March 31, 2009, crude oil and raw material prices significantly
increased worldwide in the first half, followed by declines in the second half.
Although the economies in the United States and Europe continued to grow in
the first half, they began to deteriorate in the second half, triggered by the
financial crisis, creating a downward spiral leading to concern of even further
deterioration of the real economy. In Asia, although the economies of China
and India continued to expand, the pace of growth slowed, and certain
countries in the region went into recession. Japan showed signs of a rapid
deterioration in economic conditions, such as decreased consumer spending
and a decline in capital expenditures.
Under these business conditions, Honda’s consolidated revenue for the fiscal
year ended March 31, 2009 amounted to ¥10,011.2 billion, a decrease from
the previous fiscal year, primarily due to decreased unit sales in automobile
business and negative currency translation effects. Net income declined to
¥137.0 billion, and net income per common share decreased, to ¥75.50.

To Our Shareholders
Motorcycle Business
Total unit sales of motorcycles rose, despite substantially lower sales in Japan,
North America, Europe and certain other areas due to deteriorating economic
conditions, as unit sales expanded in Asia and other regions including South
America.
In Asia, where market growth is continuing, sales expanded steadily as
Honda strengthened its lineup, introduced models equipped with automatic
transmissions, which are very popular in urban areas, and implemented other
measures. In Other Regions, which includes South America, sales of 125cc
and 150cc motorcycles were strong in Brazil. On the other hand, in Japan,
amid a difficult operating environment, sales of 50cc scooters declined, and, in
North America, sales of off-road and all-terrain vehicles (ATVs) decreased from
the previous year.
Automobile Business
Although unit sales increased in Asia and Other Regions which includes Brazil,
total worldwide sales were below the level of the previous fiscal year because
of declines in North America, Japan, and certain other markets. In North
America, the introductions of the all-new Pilot, Acura TSX, Acura TL and other
models had a positive effect, but, as a result of the deterioration in the real
economy triggered by the financial crisis, total unit sales declined. Also, in
Europe, although demand increased in Russia and Eastern Europe, overall
sales decreased because of lower unit sales in Western European markets,
including the United Kingdom and Germany, as a result of the deterioration in
economic conditions. In Japan, although the introduction of the new FREED,

Odyssey, and Life models had a positive effect, unit sales declined because of
the impact of the decline in consumer confidence accompanying the downturn
in the economy. In Asia outside Japan, sales expanded as a result of the
launch of the new City model as the trend toward driving smaller cars
accelerated along with the rise in fuel prices and other factors. Also, in Other
Regions, unit sales rose over the previous year as a result of the introduction of
the new Fit model in South America and other factors.

Total unit sales of power products decreased from the level of the previous
fiscal year, despite increases in sales of engines for OEM use in construction in
Asia and Other Regions. This decline was a result of lower sales of engines for
OEM use in construction machinery, high-pressure washing equipment, and
lawn mowers in North America, a decrease in sales of engines for OEM use in
construction machinery and generators in Europe, and other factors.
Amid this environment, the Honda Group worked to strengthen its operating
and financial positions to enable it to respond quickly and accurately to
changes in the diverse needs of customers and society as a whole. On the
other hand, to concentrate its limited corporate resources in business domains
where they are necessary in the midst of rapidly changing economic
conditions, Honda reviewed its investment and development plans and
decided to implement a number of measures. We request the understanding of
all interested parties regarding these decisions.

To Our Shareholders
Initiatives Going Forward

Because of the sudden changes in the operating environment, Honda has
made changes in some of its scheduled plans. However, we have not made
any changes in our policy of emphasizing responsiveness to environmental and
energy-related issues. We are, therefore, continuing to pursue the challenges of
developing new products that will delight our customers and the creation and
introduction of new technologies.
Advancement of Advanced Environmental Technologies

Honda was one of the first companies to position a reduction in CO2 emissions
as a major issue linked to environmental preservation on a global scale. We are
moving ahead with initiatives to attain the goals we have set for ourselves for
reducing CO2 emissions by 2010 in all of our products and manufacturing
activities worldwide. There are many methods for reducing CO2 emissions, but
in the automobile business, we believe that advancing hybrid car technology
will be the most realistic and beneficial of various alternatives.
In our new Insight hybrid car, which we introduced in February 2009, our
originally developed IMA (integrated motor assist) hybrid system incorporated
in the vehicle is designed for use in small cars and is light and compact and
features superior fuel economy.
As a result of the development of a new platform, the Insight realizes the
goals of offering both high performance as a hybrid car and substantial cost
reductions necessary for a vehicle that will appeal to a wider market. We plan
to strengthen our lineup of models with an eye to also offering mid - and large-
sized hybrid automobiles.
In the field of motorcycles for traveling relatively short distances, we are
proceeding with the development of an electric-powered motorcycle that will
run on batteries, and, taking advantage of special features of this power
source, will have zero CO2 emissions. Our goal is to introduce these electric-
powered motorcycles in about two years.

To Our Shareholders

Further Advancement of Motorcycle Business
The motorcycle business has performed solidly, even in the midst of the severe
economic environment following the global financial crisis. Historically speaking,
motorcycles have been strong in challenging times, and they have been a
propelling force for Honda’s growth and expansion and one of its major
strengths. Especially in Asia, South America and certain other regions,
motorcycles are essential for meeting daily transportation needs, and they are
expected to show solid growth in the long term. We are working to increase
our capabilities to respond flexibly to changes in the business environment by
further strengthening our motorcycle business. Honda offers many models
ranging from commuter models that provide daily transportation needs to
large-scale models that meet individual rider tastes and preferences. Among
these, the Super Cub C100 is a regular part of riders’ daily lives in a total of
160 countries. Sales of the Cub series had reached a cumulative worldwide
total of 60 million motorcycles by the end of April 2008, and the Super Cub has
become the model that symbolizes Honda.
Going forward, we will offer models worthy of the Honda brand that,
following in the Super Cub tradition, will enable us to create new categories
and new markets.
Advancement of Honda’s Global Flexible Production System and Capabilities

During the first half of the first decade of the 21st century, Honda introduced a
production system that could respond flexibly to demand for a diverse range of
models. Following that, Honda expanded its overseas production bases to
create a global, mutually complementary production system. Last year, in North
America, we began operations at our Indiana plant in the United States and at
our new engine plant in Canada. Also, in Asia, we began production at a
second automobile plant in Thailand.
Our goal is to focus on creating a “mature, flexible production system” that
will provide us with advanced flexibility to respond nimbly, first to fluctuations in
the economy and then to other changes and developments in the operating
environment. In addition to offering even higher-quality, more-attractive
products to our customers around the world in the years ahead, we will be
working to innovate with technologies and production systems that maintain
our high standards of craftsmanship.

To Our Shareholders
Returning Profit to Shareholders

Honda strives to conduct its business from a global perspective and to increase
its corporate value. We consider the allocation of profits to shareholders to be
one of our most important management responsibilities. Our basic policy for
dividends is to make distributions after taking into account our long-term
consolidated earnings performance. Honda also acquires its own shares with
optimal timing with the goal of improving the efficiency of its capital structure.
For fiscal 2009, Honda set a year-end cash dividend of ¥8 per share,
bringing total cash dividends for the fiscal year to ¥63 per share. This dividend
comprised ¥22 per share for the first quarter, ¥22 per share for the second
quarter, ¥11 per share for the third quarter, and the previously mentioned year-
end dividend of ¥8 per share.
For the fiscal year ending March 31, 2010, we plan to pay quarterly
dividends of ¥8 per share, or ¥32 per share for the full year.
We will continue to do our utmost to meet the expectations of our
shareholders.
Honda is a company where each and every member of management and the
organization sets challenging objectives, works to realize the dream of
providing joy to Honda customers as well as realizing his or her potential, and,
while setting a course for a better tomorrow, wants to help shape the future
through innovation and growth.
Our overriding desire is to be a company that society wants to exist. In the
years to come, as in years past, we will continue to meet the challenges of
innovation and creativity and, motivated by “The Power of Dreams,” respond to
the expectations of society, giving our customers enjoyment, inspiration, and
satisfaction.

We look forward to the continued understanding and
support of our shareholders and other investors for the long term.
June 23, 2009

Takanobu Ito
President & Chief Executive Officer
17
Thousands Years ended March 31
12,000 12000
Review of Operations
10000
8,000 8000
6000
4,000 4000
2000
0 0
05 06 07 08 09
Motorcycle Business Thousands Years ended March 31
4,000
4000
3500
3,000 3000
2500
2,000 2000
1500
1,000 1000
500
Unit Sales Thousands 2008 2009 % change
0 0
Japan 05311 06 07 08 09 232 (25.4) %
North America 453 320 (29.4)
Europe 313 276 (11.8)
Asia 8,000 6,633 7,523 13.4
6000
Other Regions 1,610 1,763 9.5
Total 9,320 10,114 5000 8.5 %
6,000
Net Sales Yen (millions) 2008 2009 4000 % change

Japan ¥ 93,592
4,000 ¥ 81,822 3000 (12.6) %
North America 265,609 182,284 (31.4)
2000
Europe 2,000226,687 178,621 (21.2)
Asia 484,418 460,412 1000 (5.0)
Other Regions 0488,390 508,372 4.1
0
Total 05
¥1,558,696 06 07 08 09
¥1,411,511 (9.4) %
600 600000
Percentage of Net Sales by Business Unit Sales Net Sales
500000
0
14.1%
Thousands 450 Years ended March 31 Yen (billions) Years ended March 31
400000
12,000 12000
2,000
300
二輪 300000
10000
1,500
200000
8,000 8000
150
100000
1,000 6000
0 0
4,000 4000
05 06 07 08 09 500
2000
0 0 0
05 06 07 08 09 05 06 07 08 09
Thousands 60
Years ended March 31 Yen (billions) Years ended March 31
18 4,000 10,000
四輪 3500
3,000 7,500
Honda’s unit sales of motorcycles, all-terrain vehicles (ATVs), and personal watercraft
(PWC) totaled 10,114 thousand units, increased by 8.5% from the previous fiscal year.
Unit sales in Japan totaled 232 thousand units, decreased by 25.4%. Overseas unit
sales totaled 9,882 thousand units, increased by 9.7%, due mainly to an increase in unit
sales of parts for local production at affiliates accounted for under the equity method in
Asia and an increase in unit sales in Other Regions including Brazil. Revenue from
external customers decreased ¥147.1 billion, or 9.4%, to ¥1,411.5 billion from the
previous fiscal year, due mainly to negative foreign currency translation effects, which
was partially offset by increased overseas unit sales. Honda estimates that, had the
exchange rate remained unchanged from the previous year, net sales for the year would
have increased by approximately ¥18.5 billion, or 1.2%. Operating income decreased
¥51.3 billion, or 34.0%, to ¥99.9 billion from the previous fiscal year, due mainly to
increased raw material costs, the negative foreign currency effects, and increased
SG&A expenses, despite the change in sales price and decreased R&D expenses.

Motorcycle Business
JAPAN
Total industry demand for motorcycles in Japan in fiscal 2009 was approximately
550 thousand units*, about 21% lower than in the previous year. Although sales
of motorcycles in the 51cc–125cc class were strong, this decrease in demand
was due mainly to restrictions on emissions of motorcycles, such demographic
factors as the decline in the number of younger people, the decline in the
number of people who acquire motorcycle driving licenses and the shortage of
motorcycle parking spaces in city areas.
Amid these difficult operating conditions, Honda strengthened its lineup by
launching the CB223S, a road sports model in April 2008, and an all-new 50cc
Monkey leisure model for the first time in 30 years in February 2009 and newly in-
troducing the VTR, a naked road sports model in March 2009. In addition, in July
2008, Honda launched the all-new CBR1000RR and the CBR1000RR-ABS,
equipped with electronically controlled “Combined ABS” for super sports models.
In fiscal 2009, although sales of new models and the Lead 110 scooter were
strong, Honda’s sales in all categories were lackluster because of more-intense
market competition and other factors. As a result, Honda’s total sales for the year
were down 25.4%, to 232,000 units.
In production activities, based on its concept of a “people-friendly and envi-
ronmentally-responsible plant,” Honda introduced its latest cutting-edge, highly
efficient manufacturing technologies. Also, Honda began production at its new
Kumamoto Factory in April 2008, which will be the leader plant for worldwide
motorcycle production.
* Source: Japan Automobile Manufacturers Association (JAMA)
NORTH AMERICA
Total demand for motorcycles and all-terrain vehicles (ATVs) in the United States*
during calendar 2008 declined 16% from the previous year, to approximately 1.33
million units. Although demand for mid-size motorcycles and scooters appears to
have increased because of the increase in gasoline prices during the first half of
the year, spending on recreational products shrank along with the emergence of
the subprime loan issue, and market conditions deteriorated sharply following the
financial crisis in September.
VTR (Japan) CB223S (Japan)

A naked road sports model, the VTR has undergone a full A light road sports model with simple, basic styling
model change and become a higher eco-performance bike
with a sporty design.
Amid this business environment, in August 2008, Honda entered a new mar-
ket segment with the introduction of the multi-utility vehicle Big Red, which is
suited for both utility and leisure. In September 2008, Honda also introduced a
full model change for the CRF450R motocross motorcycle and the FourTrax
Rancher AT-utility ATV.
Unit sales in North America declined 29.4% compared with the previous fiscal
year, to 320,000 units. In the motorcycle category, although sales of the Shadow
cruiser model, the Ruckus scooter, and the Metropolitan scooter increased, sales New production facility in Kumamoto Factory
of off-road and sports motorcycles decreased. As a result, Honda’s motorcycle
sales in North America fell 22.3%, to 188,000 units. In the ATV category, unit
sales declined 37.4%, to 132,000 units. Unit sales of both sport ATVs and utility
ATVs for work use declined.
* Source: MIC (Motorcycle Industry Council)
EUROPE
Total demand for motorcycles in Europe*1 during calendar 2008 declined 6%
from the previous year, to about 1.25 million units as a result of the economic
downturn, particularly deterioration in consumer sentiment following the financial
crisis in September.
Amid this business operating environment, Honda introduced the CB1000R Cell assembly line in the Kumamoto Factory
naked type sports bike offering a powerful and dynamic performance in May
2008 and launched the new model CBF125 naked type sports bike offering su-
perior maneuverability at an attractive price near the end of 2008.
In fiscal 2009, although unit sales of the 110cc LEAD scooter, the XL700V, du-
al-purpose sports model and the CB1000R new sports bike were strong, unit
sales of super sports models, small motorcycles, larger scooters, and certain
other models declined. As a result, total unit sales in Europe were down 11.8%,
to 276,000 units.
*1: The motorcycle registration market includes 10 countries: the United Kingdom, Germany, France, Italy, Spain,
Switzerland, Portugal, the Netherlands, Belgium, and Austria.
FourTrax Rancher AT (North America) XL700V (Europe)

Features the first dual-clutch transmission on an ATV and a A dual-purpose sports model equipped with a V-type, two-
newly designed water-cooled engine cylinder engine

Motorcycle Business
ASIA
Demand for motorcycles is continuing to expand in Asia, where they are an es-
sential means of transportation. In calendar 2008, despite the unfavorable impact
of declines in agricultural product prices in the second half of the year, total de-
mand*1 for motorcycles in the principal countries of Asia rose approximately 6%,
to about 37.9 million units, as a result of a strong economic performance in the
first half of the year.
By country, in India, sales were about 7.4 million units, approximately the
same as in the previous year. Unit sales were driven by a variety of factors, in-
cluding the favorable impact of lower excise duties, which contributed to expan-
sion in demand for motorcycles, and weak consumer confidence because of the
deterioration of economic conditions from the latter half of the year. In Indonesia,
sales for the year were up 33%, to about 6.5 million units, boosted by increases
in the farm household income and despite the tightening of credit criteria from the
latter half of the year onward. Sales in Thailand rose 7%, to about 1.7 million
units, supported by favorable economic growth in the first half of the year, despite
declines in agricultural product prices in the latter half.
Amid these business conditions, in Thailand, Honda launched its CZ–i 110
family-sport model which offers a highly eco-friendly performance and low fuel
consumption and the Click–i, equipped with an automatic transmission and
PGM-FI (electronic fuel injection) in July 2008. In addition, the Wave 110– i 110cc
bike equipped with a new model engine was launched in January 2009. The
Wave series of motorcycles are a key lineup in Asia, with annual sales of about
2.6 million units, in seven countries, mainly in the ASEAN region. Following the
introduction in Thailand, Honda plans to introduce this Wave series lineup to the
rest of the ASEAN region. In Vietnam, Honda introduced the Wave RSX in April
2008. In India, Honda Motorcycle and Scooter India Private Limited, Honda’s
wholly owned subsidiary, introduced the CBF Stunner 125cc motorcycle in June
2008 and the Activa scooter, powered by a new 110cc engine offering improved
fuel economy in March 2009.
CZ-i 110 (Thailand) CBF Stunner (India)

With a newly developed 110cc FI engine, the CZ-i 110 offers With an appearance and equipment that are in a higher class,
an 18% improvement in fuel economy and a 25% increase in the CBF Stunner emphasizes style and drive feel.
power.
In addition, in Indonesia, P.T. Astra Honda Motor, a company accounted for
under the equity method, launched the BeAT with an automatic transmission in
June 2008 and the BLADE in December.
Honda’s unit sales in Asia*2 for fiscal 2009 rose 13.4%, to 7,523,000 units,
due mainly to the favorable sales of the all-new CBF Stunner in India and the Air
Blade, 110cc scooter in Vietnam.
In production activities, in India, Hero Honda Motors Ltd., a company ac-
counted for under the equity method, began operations at its third factory in April Second motorcycle plant in Vietnam
2008, thus bringing that company’s total annual production capacity in India to
6.15 million units together with the capacity of Honda Motorcycle and Scooter
India Private Limited. In Vietnam, Honda began the production of scooters
and 125cc Cub scooters at its second plant in that country, and brought Honda’s
total annual production capacity in Vietnam to 1.5 million units.
*1: The motorcycle registration market includes eight countries: Thailand, Indonesia, Malaysia, the Philippines,
Vietnam, India, Pakistan and China.
*2: This total includes sales of completed products of Honda and its consolidated subsidiaries and unit sales of
parts to Honda’s affiliate companies accounted for under the equity methods for use in local production by
such companies.
OTHER REGIONS
In Brazil, the principal market within Other Regions, total demand in calendar
2008 increased to approximately 1.91 million units, due to favorable economic
growth in the first half of the year. Unit sales in Other Regions (South America, the
Middle & Near East, Africa and Oceania) consolidated unit sales rose 9.5% over
the previous fiscal year, to 1,763,000 units, due mainly to strong sales of new
models such as the CG125 FAN and CG150 TITAN, in Brazil.
Also in Brazil, Honda launched its CG150 TITAN MIX small motorcycle,
equipped with its Mix Fuel Injection System in March 2009, which enables flexible
mixture of bio-ethanol and gasoline fuels. This technology helps to reduce CO2
emissions and contributes to reduction in the burden of fuel costs.
Activa (India) BeAT (Indonesia) CG150 TITAN MIX (Brazil)

This is the first full model change for the Activa, a bike that has Offers compactness, advanced design, good fuel economy, A compact motorcycle equipped with Honda’s original flexible
come to be admired and is in wide use. and a pleasant ride fuels technology

12,000 12000
10000
8,000 8000
6000
4,000 4000
2000
0 0
05 06 07 08 09
Automobile Business Thousands Years ended March 31
4,000
4000
3500
3,000 3000
2500
2,000 2000
1500
1,000 1000
500
0 0
Japan 05615 06 07 08 09 556 (9.6) %
North America 1,850 1,496 (19.1)
Europe 391 350 (10.5)
Asia 8,000 755 793 5.0
6000
Other Regions 314 322 2.5
Total 3,925 3,517 5000 (10.4) %
Thousands 6,000 Years ended March 31 0 Yen (billions) Years ended March 31
Net Sales 12,000 12000

2,000 4000 % change
Yen (millions) 2008 2009
二輪
Japan ¥1,321,005
4,000 ¥1,225,384 10000 3000 (7.2) %
1,500
North America 5,209,446 3,723,877 (28.5)
8,000 8000 2000
Europe 1,182,666
2,000 923,580 (21.9)
Asia 1,048,463 1,000 6000
1,079,585 1000 3.0
Other Regions 0727,811 721,978 4000 (0.8)
4,000 0
Total 05
¥9,489,391 06 07 08 ¥7,674,404
09 500 (19.1) %
2000
3 月31 日に終了した各年度
0 Yen (billions) Years ended March 31 0 0

05 60006 07 08 09 05 600000
06 07 08 09
500000
Thousands 450 60
4,000 10,000
400000
4000
300
四輪 3500 300000
3,000 7,500 3000
200000
150 2500
100000
2,000 5,000 2000
76.7% 1,000
0
05 06 07 08 09 2,500 1000
1500 0
500
0 0 0
05 06 07 08 09 05 06 07 08 09
Thousands 120
24 Annual Report 2009 8,000 500

6000
汎用
400 5000
6,000
Honda’s unit sales of automobiles totaled 3,517 thousand units, decreased by 10.4%
from the previous fiscal year. Unit sales in Japan totaled 556 thousand units, decreased
by 9.6%. Overseas unit sales totaled 2,961 thousand units, decreased by 10.5%, due
mainly to a decrease in unit sales in North America, which was offset in part by an
increase in unit sales in Asia and Other Regions including Brazil.
Revenue from external customers decreased ¥1,814.9 billion, or 19.1%, to ¥7,674.4
billion from the previous fiscal year, due to the negative foreign currency translation
effects and lower unit sales. Honda estimates that, had the exchange rate remained
unchanged from the previous year, net sales for the year would have decreased by
approximately ¥889.9 billion, or 9.4%.
Operating income decreased ¥637.1 billion, or 96.3%, to ¥24.5 billion, from the
previous fiscal year, due mainly to a decrease in income attributable to the decreased
net sales in North America and Japan, the negative foreign currency effects, an
increase in fixed costs per unit as a result of production cuts, increased raw material
costs, changes in the model mix brought by shift of customers’ demands towards more
compact and fuel efficient models along with expenses related to withdrawal from
some racing activities and cancellations of development of new models, despite
continuing cost reduction, the change in sales price, a decrease in costs for product
warranties, decreased R&D expenses and reduced sales incentives in North America.
当年度の四輪事業の売上台数は、北米・欧州・アジア・その他の地域で増加したことにより、392 万
5 千台と前年度にくらべ 7.5% の増加となりました。
四輪事業の売上高は、売上台数の増加や為替換算上の増加などにより、9 兆 4,893 億円と前年度に
くらべ 6.8% の増収となりました。
営業利益は、増収に伴う利益の増加、コストダウン効果、値上げ影響ならびに為替影響などにより、
北米地域のインセンティブの増加、原材料価格の高騰影響、販売費及び一般管理費の増加、機種構成
の変化、研究開発費ならびに減価償却費の増加などのマイナス要因はあったものの、6,616 億円と前
年度にくらべ 10.4% の増益となりました。

Automobile Business
JAPAN
Total automobile demand in Japan*1 (as measured by the number of regular vehi-
cle registrations (661cc or higher) and mini-vehicles (660cc or lower)) for the fiscal
year showed approximately 12% decline compared with the previous year to 4.7
million units, reflecting the decline in demand as the financial crisis began to have
an impact on the economy from September 2008.
Of this total, regular vehicle registrations declined approximately 16% from the
previous year, to about 2.89 million units, as the global financial crisis began to
have an impact on the real economy. Sales of mini-vehicles held relatively stable
because of the favorable effects of the introduction of new models by various man-
ufacturers and the increasing trend toward driving smaller cars, however, from No-
vember 2008 onward the economy moved into a downturn, and mini-vehicle sales
for the fiscal year fell 4% from the level of the previous year, to 1.81 million units.
Amid these business operating conditions, Honda worked to strengthen its
product lineup by introducing the new model FREED, a brand-new compact mini-
van that is easy to handle and offers a spacious cabin with stylish design in May
2008, a new version of the Odyssey minivan in October, and the all-new Life in
November. In addition, in February 2009, Honda launched the Insight, a brand-
new hybrid vehicle that incorporates a lightweight, compact hybrid system inside
a compact body, while offering superior fuel economy and fun driving.
Although registrations of the Honda Fit and new models FREED and Insight
were strong, as a result of market headwind, overall unit sales dropped 9.6% be-
low the level of the previous fiscal year, to 556,000 units.
In production activities, Honda reduced output in response to the worldwide
decline in unit sales and the need to make adjustments in inventories. As a conse-
quence, the number of automobiles production during the fiscal year was down
11.4%, to 1,148,000 units. In response to sudden changes in global markets,
Honda transferred all production of the Stream model from the Suzuka Factory to
the Saitama Factory. Also, production of the Fit for the North American market be-
gan at the Saitama Factory in addition to the Suzuka Factory. The start-up of pro-
duction at the Yorii Factory, which was scheduled for 2010, has been postponed
for two years or more. Also, plans for beginning the manufacturing of mini-vehicles
at the Yokkaichi Factory of Yachiyo Industry Co., Ltd., have been postponed for
one year or more.
*1: Source: JAMA
Accord (Japan) Odyssey (Japan)

Inspired by the key phrase “advanced quality,” the Accord Offers a smoother ride even better than previous minivans with
offers everything in performance and function plus a major its low-slung styling
improvement in quality.
NORTH AMERICA
In calendar 2008, total demand in the United States*1 declined 18% from the pre-
vious year, to about 13,190,000 units. As a result of the increase in gasoline prices
in the first half of the year, a shift from light trucks such as large sports utility vehi-
cles (SUVs) and pickup trucks to the fuel-efficient smaller car segment continued.
However, by the latter half of the year, sales of compact cars and light trucks had
also dropped significantly. Especially from October, the market showed major
contraction as a result of the effects of the financial crisis on the real economy, the
deterioration in employment conditions, restraint in consumer spending, the New factory in Indiana
adoption of more stringent credit criteria by financial institutions, and other factors.
Under these circumstances, Honda aggressively introduced new models. In
the Honda channel, the all-new Pilot was launched in May 2008, the all-new Fit in
August, and the new Insight hybrid car in March 2009. Similarly, through its Acura
channel, model introductions included the all-new TSX in April 2008, and the all-
new TL in September.
Amid this business operating environment, Honda’s unit sales of its competi-
tive lineup of compact cars expanded in the first half of the year as gasoline
prices rose, while other automakers reported declining sales. In May 2008, the
Honda Civic took the number one spot for new car sales among all models on
the market.
However, along with the deterioration in the real economy, sales began to fall
in all segments, and, for the fiscal year, unit sales in North America as a whole Insight (North America)
declined 19.1%, to 1,496,000 units. Although sales of the all-new TSX held firm,
due to its attractive price, sales of higher-priced models such as light trucks, the
Odyssey, the Pilot and the Acura MDX, as well as the Acura TL dropped sub-
stantially, reflecting decline in consumer sentiment and demand.
In the area of production, manufacturing of the Civic at the new automobile
production plant in Indiana started in October 2008, but because of the sudden
decline in demand, Honda had made production cutbacks at the major plants in
North America. As a result, the number of automobiles production declined
13.2% from the previous fiscal year, to 1,251,000 units.
*1: Source: Ward’s Auto
TSX (North America) Fit (North America) TL (North America)

An entry-level Acura with sportier styling and easier handling A subcompact passenger car with a sporty ride, reflecting A luxury sedan offering a dynamic driving experience
close attention to design

Automobile Business
EUROPE
During calendar 2008, demand in the principal markets of Spain, Italy, and the
United Kingdom declined along with the unfavorable impact of the financial crisis
from September 2008. As a consequence, total demand in Europe*1 fell approxi-
mately 8%, to about 14,710,000 units. On the other hand, total demand in Russia
increased approximately 13% from the previous year, to 2,930,000 units.
Amid this business environment, although Honda introduced the all-new Ac-
cord in June and Jazz (sold as the Fit in Japan) in October 2008 into European
markets, unit sales in this region were down 10.5% from the previous year to
350,000 units mainly due to decreased total demands.
In production activities, Honda of the U.K. Manufacturing Ltd., a Honda U.K.
subsidiary, made production adjustments in response to the sudden decline in au-
tomobile demand. As a result, production at Honda’s U.K. plant decreased 29.4%,
to 175,000 units compared to the same period of the previous fiscal year.
*1: Source: Association des Constructeurs Europeens d’Automobiles (the European automobile association) (Pas-
senger cars, figures include 27 EU countries and 3 European Free Trade Association (EFTA) countries.)
*2: Source: Association of European Businesses
ASIA
In Asia, total demand in principal countries*1 in calendar 2008 increased over the
previous year to about 15,100,000 units, despite the impact of the global financial
crisis from September 2008 onward.
Under this business operating environment, Honda introduced the all-new Fit in
Taiwan in October 2008. Honda also introduced the all-new City, a small sedan in
Thailand, in September 2008, and subsequently to India and other countries in
Asia. The number of countries in Asia that are offering tax breaks to stimulate de-
mand for fuel-efficient compact cars is increasing. In the compact car market,
where continued growth is expected, Honda is introducing the City and the Jazz to
follow the Civic, Accord, and CR-V, as consistent volume sales products.
During the fiscal 2009, total sales (comprising finished automobiles of Honda
and its consolidated subsidiaries and unit sales of parts to Honda’s affiliated com-
panies accounted for under the equity method) rose 5.0% over the level of the pre-
vious fiscal year, to 793,000 units. Sales of the City and Jazz models held strong in
Thailand, Indonesia, Malaysia, and elsewhere. Similarly, sales of the new Accord
Accord (Europe) Jazz (Europe)

A sporty look combining superior driving stability with high- Featuring top-class utility, high-level fuel economy, and
level safety and environmental performance monoform design

through Guangzhou Honda Automobile Co., Ltd. (an affiliate accounted for under
the equity method), and sales of the CR-V through Dongfeng Honda Automobile
Co., Ltd. (an affiliate accounted for under the equity method) were also strong.
In production, with an eye to future growth in the Asia/Oceania region, Honda
began production at its second plant in Thailand in October 2008, which has an
annual production capacity of 60,000 units. In India, in view of the drastic changes
in the market environment, Honda announced that plans for the start-up of a new
automobile plant have been postponed. Announcement event for the City in India
*1: The total includes 11 countries: Thailand, Indonesia, Malaysia, the Philippines, Vietnam, Singapore, Taiwan,
South Korea, India, Pakistan, and China
OTHER REGIONS
Total demand in principal markets in the Other Regions increased, due mainly to
economic expansion in the first half of the fiscal year, although conditions became
stagnant in the latter half of the year as a result of the financial crisis from Septem-
ber 2008 onward.
Total demand in Brazil*1 in calendar 2008 was approximately 2,670,000 units,
approximately 14% higher than in the previous year. On the other hand, total de-
mand in Australia*2 decreased 4% from the previous year, to approximately
1,010,000 units.
Amid this business operating environment, Honda worked to strengthen its New fourth plant in Thailand
lineup of automobiles and increase sales in Brazil. In addition to the existing Civic
FFV model which is able to run on a flexible mixture of gasoline and ethanol fuel,
Honda has expanded the flexible-fuel vehicle (FFV) version to the Fit model in No-
vember 2008.
During fiscal 2009, even though unit sales in Australia, the Middle East, and
certain other areas declined, Honda reported increases in unit sales in Brazil due
mainly to favorable sales of the all-new Fit, supported by the implementation of a
tax reduction on industrial products in Brazil and other developments. Similarly,
Honda reported increased sales in the Argentine market. As a result, unit sales in
Other Regions rose 2.5%, to 322,000 units.
*1: Source: ANFAVEA (Associaçao Nacional dos Fabricantes de Veiculos Automotores (the Brazilian automobile
association)(includes passenger vehicles and light commercial vehicles)
*2: Source: Federal Chamber of Automotive Industries (the Australian automobile association)
City (Asia) Fit FFV (Brazil)

Offers high value as a new benchmark for sub-compact Popular in Brazil as a flexible-fuel vehicle (FFV), the Fit FFV
sedans leaps ahead of previous models in styling, fuel economy, and
driving pleasure.
12,000 12000
10000
8,000 8000
6000
4,000 4000
2000
0 0
05 06 07 08 09
Power Product and Other Businesses Thousands Years ended March 31
4,000
4000
3500
Thousands 3,000 Years ended March 31 0 Yen (billions) 3000 Years ended March 31
12,000 12000
2,000
2500
2,000
二輪
10000 2000
1,500
1500
8,000 8000
1,000 1000
1,000 6000
500
4,000 0 4000 0
Japan 05550 06 07 08 09 516500 (6.2) %
North America 2,415 1,893 2000 (21.6)
Europe 1,693 1,306 (22.9)
0 Thousands Years ended March 31 0 0
Asia 058,00006 915
07 08 09 970 05 06 07 6.0
08 09
6000
Other Regions 484 502 3.7
Total 6,057 5,187 5000 (14.4) %
Thousands 6,000 60
4,000 10,000 4000 % change

Net Sales Yen (millions) 2008 2009 4000
四輪
Japan ¥147,775
4,000 ¥115,252 3500 3000 (22.0) %
3,000 7,500 3000
North America 109,445 80,124 (26.8)
2000
Europe 2,000 96,847 71,126 2500 (26.6)
Asia 2,000 39,449 5,000 2000
50,739 1000 28.6
Other Regions 0 27,678 25,824 1500 (6.7)
0
Total 1,000 05
¥421,194 06 07 08 09
¥343,065
2,500 (18.5) %
1000
3 月31 日に終了した各年度 500
0 Yen (billions) Years ended March 31 0 0
05 60006 07 08 09 05 600000
06 07 08 09
500000
120
3.4%
Thousands 450 Years ended March 31 Yen (billions) Years ended March 31
8,000 500
400000
6000
300
汎用 300000
400 5000
6,000
200000
150 300 4000
100000
4,000
3000
200
0 0
05 06 07 08 09 2000
2,000
100
1000
0 0
0
05 06 07 08 09 05 06 07 08 09
Yen (billions) 180

30 Annual Report 2009 600 600000

6,000
金融
500000
450 4,500
Honda’s unit sales of power products totaled 5,187 thousand units, decreased by
14.4% from the previous fiscal year. Unit sales in Japan totaled 516 thousand units,
decreased by 6.2%. Overseas unit sales totaled 4,671 thousand units, decreased by
15.2%, due mainly to decreased unit sales in North America and Europe. Revenue
from external customers decreased ¥78.1 billion, or 18.5%, to ¥343.0 billion, from the
previous fiscal year, due mainly to the decreased unit sales of power products and
negative foreign currency translation effects. Honda estimates that, had the exchange
rate remained unchanged from the previous fiscal year, net sales for the year would
have decreased by approximately ¥49.0 billion, or 11.7%. Operating loss was ¥15.4
billion, a decrease of ¥37.8 billion from the previous fiscal year, due mainly to a
decrease in income attributable to the decreased net sales and increase in R&D
expenses in other businesses, despite decreased SG&A expenses.


JAPAN
In Japan, Honda newly launched the Yukios SB800, snow blower which is com-
pact and lightweight and clears snow with a blade. Honda also newly intro-
duced the Pianta FV200, a gas-powered mini tiller that uses the same butane
gas canisters that are used in households for powering portable gas stoves. In
addition, Honda introduced its original thin-film solar cells that reduce CO 2
emissions in the manufacturing process and satisfy specifications for use in
public and industrial applications.
Unit sales in Japan were down 6.2%, to 516,000 units, because of the de-
cline in sales of water pumps, GX series engines for electric power generators
sold to original equipment manufacturers (OEM*), and other products.
* OEM (Original equipment manufacturer) refers to the manufacturing of products and components sold under
a third-party brand.
NORTH AMERICA
Unit sales in North America declined 21.6%, to 1,893,000 units. Factors ac-
counting for this decline were weakness in the sales of general-purpose engines
for OEM use in construction equipment, high-pressure washers, and lawn mow-
ers as well as weakness in the sales of lawn mowers, due to the downturn in the
U.S. economy.
EUROPE
In Europe, unit sales declined 22.9%, to 1,306,000 units. Sales of GX and GC
series engines for OEM use in construction machinery, generators, and other ap-
plications declined.
ASIA
In Asia outside of Japan, Honda newly launched engines specially designed for
longtail boats, the GX160, the GX200 and the GX390, which are in wide use as a
major means of water transportation, featuring improved handling and durability.
In addition, in China, Honda newly introduced its superior-performance HRJ196
lawn mowers that are compact, lightweight and easy to use.
Unit sales in Asia, excluding Japan, increased 6.0% from the previous fiscal
year, to 970,000 units, as a result of expansion in sales of WB20XT pumps in In-
donesia and increases in sales of GX160 general-purpose engines for OEM use
in water pumps and other applications in China.
Yukios GX390

OTHER REGIONS
In Other Regions, unit sales rose 3.7% over the previous fiscal year, to 502,000
units, as a result of higher unit sales in the Middle East of GX390 general-purpose
engines for OEM use in construction machinery and generators and increased
sales of GX series general-purpose engines in South America.
SOLAR CELL BUSINESS

In October 2007, consolidated subsidiary Honda Soltec Co., Ltd., began the pro- Honda Soltec Co., Ltd.
duction of thin-film solar cells for household use and entered the public-sector
and industrial markets for these products in October 2008. Currently, Honda
Soltec is strengthening its capabilities for expanding sales.
COGENERATION UNITS
Honda began to sell its household-use cogeneration unit equipped with the
ECOWILL system in Japan in March 2003 through gas companies. In addition,
Honda began to sell cogeneration units in the United States in March 2007.
Looking ahead, Honda will aim for an expansion in sales of cogeneration units.
Moreover, Honda is now developing its original core unit with the aim of mak-
ing it more compact and more efficient, and has plans to launch a new type of
cogeneration unit within the next two to three years featuring smaller size, higher Thin-film solar cells
efficiency, and a high level of eco-compatibility.
AVIATION BUSINESS
In 2008, subsidiary Honda Aircraft Company, Inc., built a new international head-
quarters facility at the Piedmont Triad International Airport in Greensboro, North
Carolina, in the United States. The move into the new headquarters was complet-
ed in May. Honda Aircraft has begun to take orders in the United States as well as
Canada, Mexico, and Europe for its HondaJet aircraft. R&D is currently in progress
with a target date for beginning deliveries in 2011.
Also, Honda Aero, Inc., which is responsible for Honda’s aircraft engine busi-
ness, has built a plant and headquarters facility near the airport in Burlington,
North Carolina and moved to the new headquarters in July 2008. This company is Cogeneration units
scheduled to begin production of Honda’s HF120 turbofan engines in 2011 and

aims to expand production to 200 units annually.
HondaJet HF120 compact turbofan engine (aircraft engine)

An original Honda design, the HF120 has low emissions that
are ahead of regulatory standards plus top-class fuel economy
and a quiet operation.
Thousands Years ended March 31 0 Yen (billions) Years ended March 31
12,000 12000 2,000

Review of Operations 二輪
10000
Thousands 0
Years ended March 31 1,500
8,000 12,000 8000 12000
2,000
二輪 6000 1,000
10000
1,500
4,000 8,000 4000 8000
500
2000 1,000 6000
0 4,000 0 0
4000
05 06 07 08 09 500 05 06 07 08 09

60 Thousands 0 Years ended March 31 Yen
2000
0
0 (billions) Years ended March 31
4,000 05 06 07 08 09 10,00005 06 07 08 09
4000
四輪 3500
3,000 Thousands 603000
Years ended March 31 7,500
4,000 10,000
2500 4000
2,000
四輪 3500
5,000
2000
3,000 7,500 3000
1500
1,000 1000 2500
2,500
2,000 5,000 2000
500
Net Sales Yen (millions) 2008 2009 % change
0 0 1500
0
Japan 05 061,00007 ¥ 23,405
08 09 ¥ 24,083
2,500 05 06 072.9 08
% 09
1000
North America 483,925 527,905 9.1
500
Europe 13,234 12,685 (4.1)
Thousands 0 Years ended March 31 120 Yen
0 (billions)
0 Years ended March 31
Asia 8,000 05 06 4,936
07 08 09 4,736 50005 06 07 (4.1)
08 09
6000
Other Regions 8,053 汎用 12,852 59.6
Total ¥533,553 5000
¥582,261 400 9.1 %
6,000 Thousands 120
8,000 4000 500

6000
300
Finance Subsidiaries — 4,000
汎用
3000 400 5000
Receivables, Net Yen (millions) 6,000 2008 2009 200 % change
Non-current ¥2,884,264 2000
¥2,571,152 4000 (10.9)%
2,000 300
100
Current 4,000 1,817,033 1,596,642 (12.1)
1000 3000
Total ¥4,701,297 ¥4,167,794200 (11.4)%
0 0
0 2000 05
05 062,00007 08 09 06 07 08 09
100
Note: The finance subsidiaries—receivables category above includes items that have been reclassified as trade receivables and other assets.
1000
Yen (billions) 0 Years ended March 31 180 Yen
0 (billions)
0
600 05 06 07 08 09 600000 6,00005Subsidiaries

Finance 06 07
—08 09
Percentage of Net Sales by Business Net Sales 金融 Receivables, Net
500000
180
5.8%
450 Yen (billions) Years ended March 31 4,500
600
400000 600000
6,000
金融 300000
300 500000
3,000
450 4,500
200000 400000
150 1,500
100000 300000
300 3,000
0 0 200000
0
05 06 15007 08 09 1,500 05 06 07 08 09
100000
0 0 0
05 06 07 08 09 05 06 07 08 09
Japan North America Europe Asia Other Regions Non-current Current

Non-current Current
REVIEW OF PERFORMANCE
To support the sale of its products, Honda provides retail lending and leasing to cus-
tomers and wholesale financing to dealers through our finance subsidiaries in Japan,
the United States, Canada, the United Kingdom, Germany, Brazil and Thailand. In
North America, the financial crisis had a severe impact on the economy, the deteriora-
tion in employment conditions, deterioration in consumer sentiment and other factors.
As a result, the environment for financial services business remained under pressure.
The total amount of finance subsidiaries—receivables and property on operating
leases of finance subsidiaries decreased by 2.2%, to ¥4,860.1 billion from the previ- Goldwing
ous fiscal year, due mainly to currency translation effects. Revenue from external cus-
tomers in the financial services business increased ¥48.7 billion, or 9.1%, to ¥582.2
billion from the previous fiscal year, due mainly to an increase in operating lease reve-
nue. Honda estimates that, had the exchange rate remained unchanged from the pre-
vious fiscal year, revenue for the year would have increased by approximately ¥124.7
billion, or 23.4%.
Operating income decreased ¥37.1 billion, or 31.5%, to ¥80.6 billion from the pre-
vious fiscal year, due mainly to an increase in provisions for credit losses and losses on
lease residual values in North America and negative foreign currency effects, despite an
increase in income attributable to higher revenue. In North America, prices of SUVs and
minivans in the used car market dropped in the first half of the fiscal year, and losses
on lease residual values of these models increased.
In addition, from September onward, losses on lease residual values of sedans and Pilot
other passenger vehicles increased. Moreover, provisions for credit losses also in-
creased as the ability of certain customers to pay their debts declined.
Our finance subsidiaries in North America have historically accounted for all leases
as direct financing leases. However, starting in the fiscal year ended March 31, 2007,
some of the leases that do not qualify for direct financing lease accounting treatment
are accounted for as operating leases. Generally, direct financing lease revenues and in-
terest income consist of the recognition of finance lease revenue at the inception of the
lease arrangement and subsequent recognition of the interest income component of to-
tal lease payments using the effective interest method. In comparison, operating lease
revenues include the recognition of the gross lease payment amounts on a straight-line
basis over the term of the lease arrangement, and operating lease vehicles are depreci-
ated to their estimated residual value on a straight-line basis over the term of the lease.
It is not anticipated that the differences in accounting for operating leases and direct fi- RL
nancing leases will have a material net impact on Honda’s results of operations overall;
however, operating lease revenues and associated depreciation of leased assets do re-
sult in differing presentation and timing compared to those of direct financing leases.
During the fiscal year ending March 31, 2010, the decline in receivables is forecast
to persist, as there are concerns that the downturn in the U.S. economy will continue,
thus causing prolonged stagnation in the automobile market. Looking ahead, Honda
will work to substantially improve its financial services and respond to changes in the
operating environment.

Preparing for the Future
Due to the current economic situation, there are concerns that the 5. Safety Technologies
economies of Japan, the U.S. and Europe will experience a down- Honda is working to develop safety technologies that enhance ac-
turn. In addition, the pace of economic growth of Asian countries cident prediction and prevention, technologies to help reduce the
outside of Japan is expected to slow down. Moreover, given the risk of injuries to passengers and pedestrians from car accidents,
many uncertainties in the global business environment in which and technologies that enhance compatibility between large and
Honda operates, including political and economic instability, fluctu- small vehicles, as well as expand its line-up of products incorporat-
ations in oil and raw material prices, and volatility in the currency ing such technologies. Honda will reinforce and continue to ad-
and financial markets, Honda expects that this will continue to be vance its contribution to traffic safety in motorized societies in Ja-
an extremely challenging environment in which to do business. pan and abroad. Honda also intends to remain active in a
With these circumstances in mind, Honda seeks to further variety of traffic safety programs, including advanced driving and
strengthen its corporate structure by making it more flexible and motorcycling training programs provided by local dealerships.
dynamic and therefore, better able to meet the needs of its cus-
tomers and society as a whole as well as respond to changes in 6. The Environment
the business environment. Also, in order to improve the competi- Honda will step up its efforts to create better, cleaner and more fu-
tiveness of its products, Honda will endeavor to enhance its R&D, el-efficient engine technologies and to further improve recyclables
production and sales capabilities. Furthermore, Honda will continue throughout its product lines. Honda will also work to advance fuel
to enhance its reputation in the community through Companywide cell technology and steadily promote its new solar cell business. In
activities. Honda recognizes that further enhancing the following addition, Honda will further its efforts to minimize its environmental
specific areas is essential to its success: impact. To this end, Honda sets global targets to reduce the envi-
ronmental burden as measured by the Life Cycle Assessment*, in
1. Research and Development all areas of business, spanning production, logistics and sales.
In connection with its efforts to develop the most effective safety *Life Cycle Assessment: A comprehensive system for quantifying the impact
Honda’ s products have on the environment at the different stages in their life
and environmental technologies, Honda will continue to be innova- cycles, from material procurement and energy consumption to waste
tive in advanced technology and products. Honda aims to create disposal.
and introduce new value-added products to quickly respond to

specific needs in various markets around the world. Honda will also 7. Continuing to Enhance Honda’s Social Reputation
continue its efforts to conduct research on experimental technolo- and Communication with the Community
gies for the future. In addition to continuing to provide products incorporating Honda’s
advanced safety and environmental technologies, Honda will con-
2. Production Efficiency tinue striving to enhance its social reputation by, among other
Honda will establish and enhance efficient and flexible production things, strengthening its corporate governance, compliance, and
systems at its global production bases and supply high quality risk management as well as participating in community activities
products, with the aim of meeting the needs of its customers in and making philanthropic contributions.
each region.
Through these Company-wide activities, Honda will strive to
3. Sales Efficiency become a company whose presence is welcomed by our share-
Honda will remain proactive in its efforts to expand product lines holders, customers and society.
through the innovative use of IT and will show its continued com-
mitment to different customers among the world by upgrading its
sales and service structure.
4. Product Quality
In response to increasing customer demand, Honda will upgrade
its quality control by enhancing the functions of and coordination
among the development, purchasing, production, sales and service
departments.

Risk Factors
Relating to Honda’s Industry

1. Honda may be adversely affected by market conditions increasing, short-term fluctuations in demand from underlying economic
Honda conducts its operations in Japan and throughout the world, includ- conditions, changes in tariffs, import regulations and other taxes, shortag-
ing North America, Europe and Asia. A sustained loss of consumer confi- es of certain supplies, high material prices and sales incentives by Honda
dence in these markets, which may be caused by continued economic or other manufacturers or dealers. There can be no assurance that such
slowdown, recession, rising fuel prices, financial crisis or other factors price volatility will not continue or intensify or that price volatility will not
could trigger a decline in demand for automobiles, motorcycles and pow- occur in markets that to date have not experienced such volatility. Overca-
er products that may adversely affect Honda’s results of operations. pacity within the industry has increased and will likely continue to increase
if the economic downturn continues in Honda’s major markets or world-
2. Prices for automobiles, motorcycles and power products can be volatile wide, leading, potentially, to further increased price pressure. Price volatili-
Prices for automobiles, motorcycles and power products in certain mar- ty in any or all of Honda’s markets could adversely affect Honda’s results
kets may experience sharp changes over short periods of time. This vola- of operations in a particular period.
tility is caused by many factors, including fierce competition, which is
Risks Relating Honda’s Business Generally
Currency and Interest Rate Risks Legal and Regulatory Risks

1. Honda’s operations are subject to currency fluctuations 1. The automobile, motorcycle and power product industries are subject
Honda has manufacturing operations throughout the world, including Ja- to extensive environmental and other governmental regulation
pan, and exports products and components to various countries. Honda Regulations regarding vehicle emission levels, fuel economy, noise and
purchases materials and sells its products in foreign currencies. Therefore, safety and noxious substances, as well as levels of pollutants from pro-
currency fluctuations may affect Honda’s pricing of products sold and ma- duction plants, are extensive within the automobile, motorcycle and power
terials purchased. Accordingly, currency fluctuations have an effect on product industries. These regulations are subject to change, and are often
Honda’s results of operations and financial condition, as well as Honda’s made more restrictive. The costs to comply with these regulations can be
competitiveness, which will over time affect its results. Since Honda ex- significant to Honda’s operations.
ports many products and components from Japan and generates a sub-
stantial portion of its revenues in currencies other than the Japanese yen, 2. Honda is reliant on the protection and preservation of its intellectual
Honda’s results of operations would be adversely affected by an apprecia- property
tion of the Japanese yen against other currencies, in particular the U.S. Honda owns or otherwise has rights in a number of patents and trade-
dollar. marks relating to the products it manufactures, which have been obtained
over a period of years. These patents and trademarks have been of value
2. Honda’s hedging of currency and interest rate risk exposes Honda to in the growth of Honda’s business and may continue to be of value in the
other risks future. Honda does not regard any of its businesses as being dependent
Although it is impossible to hedge against all currency or interest rate risk, upon any single patent or related group of patents. However, an inability
Honda uses derivative financial instruments in order to reduce the sub- to protect this intellectual property generally, or the illegal breach of some
stantial effects of currency fluctuations and interest rate exposure on our or a large group of Honda’s intellectual property rights, would have an ad-
cash flow and financial condition. These instruments include foreign cur- verse effect on Honda’s operations.
rency forward contracts, currency swap agreements and currency option
contracts, as well as interest rate swap agreements. Honda has entered 3. Honda is subject to legal proceedings
into, and expects to continue to enter into, such hedging arrangements. Honda is subject to a number of suits, investigations and/or proceedings
As with all hedging instruments, there are risks associated with the use of under relevant laws and regulations of various jurisdictions. A negative out-
such instruments. While limiting to some degree our risk fluctuations in come in one or more of these pending legal proceedings could adversely
currency exchange and interest rates by utilizing such hedging instru- affect Honda’s business, financial condition or results of operations.
ments, Honda potentially forgoes benefits that might result from other
fluctuations in currency exchange and interest rates. Honda is also ex-
posed to the risk that its counterparties to hedging contracts will default
on their obligations. Honda manages exposure to counterparty credit risk
by limiting the counterparties to major international banks and financial in-
stitutions meeting established credit guidelines. However, any default by
such counterparties might have an adverse effect on Honda.

Risk Factors
6. Risk related to Pension and Other Postretirement Benefits

Risks Relating to Honda’s Operations
Honda has pension plans and provides other post-retirement benefits.
1. Honda’s financial services business conducts business under highly The amounts of pension benefits, lump-sum payments and other post-
competitive conditions in an industry with inherent risks retirement benefits are primarily based on the combination of years of
Honda’s financial services business offers various financing plans de- service and compensation. The funding policy is to make periodic contri-
signed to increase the opportunity for sales of its products and to gener- butions as required by applicable regulations. Benefit obligations and
ate financing income. However, customers can also obtain financing for pension costs are based on assumptions of many factors, including the
the lease or purchase of Honda’s products through a variety of other discount rate, the rate of salary increase and the expected long-term rate
sources that compete with our financing services, including commercial of return on plan assets. Differences in actual expenses and costs or
banks and finance and leasing companies. The financial services offered changes in assumptions could affect Honda’s pension costs and benefit
by us also involve credit risk as well as risks relating to lease residual val- obligations, including Honda’s cash requirements to fund such obliga-
ues, cost of capital and access to funding. Competition for customers tions, which could materially affect our financial condition and results of
and/or these risks may affect Honda’s results of operations in the future. operations.
2. Honda relies on various suppliers for the provision of certain raw 7. As a holder of ADSs, you will have fewer rights than a shareholder has
material and components and you will have to act through the depositary to exercise those rights
Honda purchases raw materials, and certain components and parts, from The rights of shareholders under Japanese law to take various actions, in-
numerous external suppliers, and relies on some key suppliers for some cluding voting their shares, receiving dividends and distributions, bringing
items and the raw materials it uses in the manufacture of its products. derivative actions, examining a company’s accounting books and records,
Honda’s ability to continue to obtain these supplies in an efficient and and exercising appraisal rights, are available only to holders of record. Be-
cost-effective manner is subject to a number of factors, some of which cause the depositary, through its custodian agents, is the record holder of
are not within Honda’s control. These factors include the ability of its sup- the Shares underlying the ADSs, only the depositary can exercise those
pliers to provide a continued source of supply and Honda’s ability to com- rights in connection with the deposited Shares. The depositary will make
pete with other users in obtaining the supplies. Loss of a key supplier in efforts to vote the Shares underlying your ADSs as instructed by you and
particular may affect our production and increase our costs. will pay to you the dividends and distributions collected from us. However,
in your capacity as an ADS holder, you will not be able to bring a deriva-
3. Honda conducts its operations in various regions of the world tive action, examine our accounting books and records or exercise ap-
Honda conducts its businesses worldwide, and in several countries, Hon- praisal rights through the depositary.
da conducts businesses through joint ventures with local entities, in part
due to the legal and other requirements of those countries. These busi- 8. Rights of shareholders under Japanese law may be more limited than
nesses are subject to various regulations, including the legal and other re- under the law of other jurisdictions
quirements of each country. If these regulations or the business conditions Our Articles of Incorporation, Regulations of the Board of Directors, Regu-
or policies of these local entities change, it may have an adverse affect on lations of the Board of Corporate Auditors and the Japanese Company
Honda’s business, financial condition or results of operations. Law govern our corporate affairs. Legal principles relating to such matters
as the validity of corporate procedures, directors’ and officers’ fiduciary
4. Honda may be adversely affected by wars, use of force by foreign duties, and shareholders’ rights may be different from those that would
countries, terrorism, multinational conflicts, natural disasters, epidemics apply if we were a U.S. company. Shareholders’ rights under Japanese
and labor strikes law may not be as extensive as shareholders’ rights under the laws of the
Honda conducts its businesses worldwide, and its operations may vari- United States. You may have more difficulty in asserting your rights as a
ously be subject to wars, use of force by foreign countries, terrorism, mul- shareholder than you would as a shareholder of a U.S. corporation. In ad-
tinational conflicts, natural disasters, epidemics, labor strikes and other dition, Japanese courts may not be willing to enforce liabilities against us
events beyond our control which may delay or disrupt Honda’s local oper- in actions brought in Japan that are based upon the securities laws of the
ations in the affected regions, including the purchase of raw materials and United States or any U.S. state.
parts, the manufacture, sales and distribution of products and the provi-
sion of services. Delays or disruptions in one region may in turn affect our 9. Because of daily price range limitations under Japanese stock exchange
global operations. If such delay or disruption occurs and continues for a rules, you may not be able to sell your shares of our Common Stock at
long period of time, Honda’s business, financial condition or results of op- a particular price on any particular trading day, or at all
erations may be adversely affected. Stock prices on Japanese stock exchanges are determined on a real-time
basis by the equilibrium between bids and offers. These exchanges are
5. Honda may be adversely affected by inadvertent disclosure of order-driven markets without specialists or market makers to guide price
confidential information formation. To prevent excessive volatility, these exchanges set daily up-
Although Honda maintains internal controls through established proce- ward and downward price fluctuation limits for each stock, based on the
dures to keep confidential information including personal information of its previous day’s closing price. Although transactions may continue at the
customers and relating parties, such information may be inadvertently dis- upward or downward limit price if the limit price is reached on a particular
closed. If this occurs, Honda may be subject to, and may be adversely af- trading day, no transactions may take place outside these limits. Conse-
fected by, claims for damages from the customers or parties affected. quently, an investor wishing to sell at a price above or below the relevant
Also, inadvertent disclosure of confidential business or technical informa- daily limit may not be able to sell his or her shares at such price on a par-
tion to third parties may result in a loss of Honda’s competitiveness. ticular trading day, or at all.

Corporate Governance
1. Basic Stance Regarding Corporate Governance

Based on its fundamental corporate philosophy, the Company is With respect to business execution, Honda has established a
working to enhance corporate governance as one of its most im- system for operating its organizational units that reflects its funda-
portant management issues. Our aim is to have our customers and mental corporate philosophy. For example, separate headquarters
society, as well as our shareholders and investors, place even have been set up for each region, business, and function, and a
greater trust in us and to ensure that Honda is “a company that so- member of the Board of Directors or an operating officer has been
ciety wants to exist.” assigned to each headquarters and main division. In addition, by
To ensure objective control of the Company’s management, out- having the Executive Council and regional operating boards deliber-
side directors and outside corporate auditors are appointed to the ate important matters concerning management, the Company imple-
Board of Directors and the Board of Corporate Auditors, which are ments a system that enables swift and appropriate decision making.
responsible for the supervision and auditing of the Company. Honda With respect to internal control, compliance systems and risk
has also introduced an operating officer system, aimed at strength- management systems have been designed and implemented ap-
ening both the execution of business operations at the regional and propriately following the basic policies for the design of internal
local levels and making management decisions quickly and appro- controls decided by the Board of Directors.
priately. The term of office of each director is limited to one year, and To enhance even further the trust and understanding of share-
the amount of remuneration payable to them is determined accord- holders and investors, Honda’s basic policy emphasizes the appro-
ing to a standard that reflects their performance in the Company. priate disclosure of Company information, such as by disclosing fi-
Our goal in doing this is to maximize the flexibility with which our di- nancial results on a quarterly basis and timely and accurately giving
rectors respond to changes in the operating environment. public notice of and disclosing its management strategies. Honda
will continue raising its level of transparency in the future.
2. Company Management Organization
Board of Corporate Auditors 5 auditors Board of Directors 21 directors

(Outside Corporate Auditors 3 auditors) (Outside Directors 2 directors)
Executive Council
Business Ethics Committee
President & CEO
Business Ethics Improvement Proposal Line Compliance Officer Risk Management Officer
Honda Driving Safety Promotion Center

Regional Sales Regional Operations
Corporate Planning Division Regional Operations Regional Operations Regional Operations Regional Operations
Operations (North America) (Latin America)
(Europe, the Middle &
(Asia / Oceania) (China)
Corporate Communications Division (Japan) Near East and Africa)
New Business Development and Planning Office

Aero Engine Business Office Regional Operating
Regional Operating Regional Operating Regional Operating Regional Operating Regional Operating
Aircraft Operation Office Board
Board Board Board Board Board
(Europe, the Middle &
Motorcycle Quality Innovation Division (Japan) (North America) (Latin America) (Asia / Oceania) (China)
Near East and Africa)
Auto Quality Innovation Division
Power Product Quality Innovation Division
Quality Assurance Division
Certification & Regulation Compliance Division
IT Division
Motorcycle Operations
Automobile Operations
Power Product Operations
Customer Service Operations
Production Operations Domestic Factories
Purchasing Operations
Business Support Operations
Business Management Operations
Corporate Project
Quality Audit & Compliance Division
Audit Office 26 staff
Corporate Auditors Office
Honda R&D Co., Ltd.
Honda Engineering Co., Ltd.
(As of June 23, 2009)

■ Board of Directors ■ Organization

The Board of Directors consists of 21 directors, including two out- As for the execution of business, the Company has six regional op-
side directors. The Board deliberates important matters related to erations around the world to develop business based on its funda-
business execution and other items designated by law based on its mental corporate philosophy. These operations adopt long-term
established deliberation standards, assesses business risk, and perspectives and maintain close ties with local communities.
then makes decisions on such matters after due consideration. The The Company’s three business operations––motorcycles, auto-
Board also controls and supervises the execution of management. mobiles, and power products––formulate the medium- and long-
During the fiscal year under review (April 1, 2008, to March 31, term plans for their business development, and each operation
2009), the Board of Directors met 10 times. aims to maximize its business performance on a global basis. Each
functional operation––such as Customer Service Operations,
■ Board of Corporate Auditors Production Operations, Purchasing Operations, Business Support
The Board of Corporate Auditors consists of five corporate auditors, Operations, and Business Management Operations––supports
including three outside corporate auditors. In accordance with the the other functional operations, with the aim of increasing Honda’s
Company’s auditing standards, auditing policies, apportionment of effectiveness and efficiencies.
responsibilities, and other such matters as determined by the Board Research and development activities are conducted principally
of Corporate Auditors, each corporate auditor audits the directors’ at the independent subsidiaries of the Company.
execution of duties. Corporate auditors accomplish these audits Honda R&D Co., Ltd., is responsible for research and develop-
through various means, including attending meetings of the Board of ment on products, while Honda Engineering Co., Ltd., handles re-
Directors and inspecting the state of the Company’s assets and lia- search and development in the area of production technology. The
bilities. In addition, a Corporate Auditors’ Office was established to Company actively carries out research and development in ad-
provide direct support to the Board of Corporate Auditors. vanced technologies with the aim of creating products that are dis-
The Company maintains Standards for Reporting to Corporate tinctive and internationally competitive.
Auditors to ensure that relevant matters are reported to corporate
auditors in a timely and accurate manner. The standards require reg- ■ Business Execution Officer System
ular reports to be submitted to corporate auditors on the business The Company has assigned a general manager from the Board of
conditions of the Company and its subsidiaries, the maintenance Directors or an operating officer to each regional, business, and
and operation of internal control systems, and any other matters functional division, as well as to each research and development
that would have a substantial impact on the Company or its sub- subsidiary. By ensuring swift, optimal decision making in each re-
sidiaries. In addition, corporate auditors are required to attend Ex- gion and workplace, the Company is building a highly effective and
ecutive Council and other important meetings. In fiscal 2009, the efficient business execution system.
Board of Corporate Auditors met 13 times.
The Board of Corporate Auditors has certified Hideki Okada, a ■ Executive Council
corporate auditor of the Company, as an “audit committee financial The Company has established the Executive Council, consisting of
expert,” as set out in the rules of the Securities and Exchange the President, Vice President, and the Senior Managing Directors.
Commission pursuant to Section 407 of the U.S. Sarbanes-Oxley Along with discussing in advance the items to be resolved at meet-
Act of 2002. As stipulated in Item 8, Article 121, of the Company ings of the Board of Directors, the Executive Council discusses im-
Law Enforcement Regulations, Hideki Okada has substantial portant management issues within the scope of authority conferred
knowledge related to finance and accounting. upon it by the Board of Directors.
■ Decisions Regarding Director Candidates ■ Regional Operating Boards

Candidates for directors are decided by resolution of the Board of To enhance the independence of each regional operation and en-
Directors. Candidates for corporate auditors are decided by resolu- sure swift decision making, regional operating boards have been
tion of the Board of Directors, subject to the agreement of the established at each regional operation to discuss important man-
Board of Corporate Auditors. agement issues in the region within the scope of authority con-
ferred upon it by the Executive Council.

3. Internal Control System: Fundamental Position and Implementation Status

The Company is designing and implementing internal control sys- of countries where they operate and practices observed in their respective
tems in accordance with the following basic policies. industries as they endeavor to enhance corporate governance.
Regarding the conduct of business by subsidiaries, rules relating to
monetary settlements have been established, and, regarding important
① Systems for Ensuring that the Execution of Duties by the Directors and
management items, internal rules have been prepared that require prior
Employees Is in Compliance with the Law and the Company’s Articles
approval of the Company or the submission of reports. In addition, the
of Incorporation
business management department of the Company receive reports on
To secure compliance of Company management and employees with
business plans and other matters on a periodic basis from subsidiaries
guidelines for conduct in conformity with applicable laws and internal rules
and confirm the appropriateness of the conduct of activities.
and regulations, the Company has prepared The Honda Conduct Guide-
The Company’s Audit Office, which is an independent unit reporting
lines and implements measures to ensure that all management and em-
directly to the President, audits the status of conduct of business activities
ployees are made aware of and follow these guidelines.
in each department, and works to improve the Honda Group’s internal au-
The Company has appointed a Compliance Officer, who is a director
diting systems.
in charge of compliance-related initiatives. Other key elements of our
For companies accounted for under the equity method, the Company
compliance system include the Business Ethics Committee and the Busi-
requests their understanding and cooperation with Honda’s basic corpo-
ness Ethics Improvement Proposal Line.
rate governance policies and endeavors to improve corporate governance
on a Groupwide basis.
② Retention and Management of Information on Execution of Business by
Directors
⑥ Matters Relating to Assignment of Personnel to Assist the Corporate
Minutes of the meetings of the Board of Directors and other important
Auditors when They Request Such Assistance and Maintenance of the
meetings as well as information related to the execution of business by
Independence of Such Personnel from the Directors
the directors will be retained and stored appropriately following the policy
The Corporate Auditors Office, which has been formed to provide staff
for the retention and management of documents.
functions for the Corporate Auditors and reports directly to them, provides
such support for the Corporate Auditors.
③ Regulations and Other Systems for Management of the Contingencies
of Losses
⑦ Systems Providing for Reporting by Directors and Employees to the
Important items related to management are proposed to the Board of Di-
Corporate Auditors and Other Arrangements for Reporting to the
rectors, the Executive Council, and/or Regional Operating boards, risks
Corporate Auditors
are assessed, and then, decisions are made, after due consideration ac-
The status of business activities of the Company’s subsidiaries and other
cording to established deliberation standards.
associated companies and the status of the design and operation of inter-
Regarding risks that are to be dealt with on a departmental basis,
nal control systems, including compliance and risk management systems,
each department will work to prevent the emergence of such risk and de-
are reported periodically to the Corporate Auditors. In addition, when
velop policies for dealing with them. For large-scale disasters requiring
there are matters that have a major impact on the Company, these are re-
Company-level crisis management, the Honda Crisis Response Rules will
ported to the Corporate Auditors.
be applied, and the member of the Board of Directors in charge will be
appointed as the Risk Management Officer, who will be responsible for
⑧ System for Ensuring that Other Auditing Activities of the Corporate
designing and implementing related systems.
Auditors Are Conducted Effectively
The Corporate Auditors and the Audit Office, which audits the conduct of
④ Systems for Ensuring that the Execution of Business by the Directors Is
business, work closely together to implement business audits in the Com-
Being Conducted Efficiently
pany, its subsidiaries, and other associated companies. In addition, the
In line with its fundamental corporate philosophy, Honda has established
Corporate Auditors also attend the meetings of the Executive Council and
organizational operating systems for each region, business, and function
other important meetings.
and a member of the Board of Directors or an operating officer has been
assigned to each headquarters and main division. In addition, by having
the Executive Council and Regional Operating boards deliberate important ■ Basic Policy Regarding Exclusion of Antisocial Elements
matters concerning management, the Company implements a system Honda’s basic policy is to boldly and consistently oppose antisocial
that enables swift and appropriate decision making. elements that present a threat to social order and safety. The or-
To conduct management efficiently and effectively, business plans are
ganizational unit in charge of responding to these elements has
prepared on an annual basis and for the medium term, and measures are
taken to share these plans.
been specified, and it works together with the police and other re-
lated outside institutions to mount an appropriate response.
⑤ Systems for Ensuring that the Corporate Group, Comprising the
Company and Its Subsidiaries, Conducts Business Activities Appropriately
The Company and its subsidiaries share The Honda Conduct Guidelines
and the basic policy regarding corporate governance. In addition, each
subsidiary works to promote activities that are in compliance with the laws

4. Cooperation among the Internal Auditing Functions, Auditing Functions of the

Corporate Auditors, and the Audits Performed by the Accounting Auditors
■ Internal Auditing Functions assistants (10 certified public accountants, 15 assistant accountants,
The Audit Office, which audits the conduct of business activities four U.S. certified public accountants, and 12 others).
and reports directly to the President, has a staff of 26, who con-
duct audits of business execution in each department and en- ■ Cooperation among Internal Functions
deavor to improve the Honda Group’s internal auditing systems. During the fiscal year under review, the Corporate Auditors and the
Accounting Auditors held meetings on six occasions. The Account-
■ Accounting Audits ing Auditors explained and reported on the plans and results of their
KPMG AZSA & Co. provided auditing services for Honda under audits to the Corporate Auditors, and the two exchanged views.
the Company Law, Japan’s Financial Instruments and Exchange The Corporate Auditors and the Audit Office, which audits the
Law, and the U.S. Securities Exchange Act. conduct of business activities, maintained close contact and made
A total of 45 people from KPMG AZSA & Co. provided auditing adjustments regarding auditing policy and the schedule for audits. In
services for Honda: three Japanese certified public accountants addition, the Corporate Auditors and the Audit Office, either sepa-
(Masanori Sato, Kensuke Sodegawa, and Hideaki Koyama) and 42 rately or working together, implemented audits of business activities.
5. Personal, Capital, or Transaction Relationships or Other Matters that Might

Represent a Conflict with the Reporting Company
■ Outside Directors The Company has appointed outside corporate auditor Yuji
The Company has appointed outside director Nobuo Kuroyanagi to Matsuda to receive audit information on its corporate activities from
receive advice on its corporate activities from an objective, broad- a broad-ranging and advanced viewpoint based on his extensive
ranging, and advanced viewpoint based on his extensive experience experience and a high level of insight in corporate management.
and a high level of insight in corporate management. There are no special interest relationships between outside au-
The Company has appointed outside director Kensaku Hogen ditor Koukei Higuchi and the Company.
to receive advice on its international diplomacy from an objective, Outside auditor Fumihiko Saito is the representative of the Sai-
broad-ranging, and advanced viewpoint based on his extensive ex- to Law Office, but there are no special interest relationships be-
perience and a high level of insight in diplomacy. tween him and the Company.
The Company has appointed Nobuo Kuroyanagi (President and Outside auditor Yuji Matsuda is the president and a director of
Director of Mitsubishi UFJ Financial Group, Inc., and, concurrently, the Mitsubishi UFJ Trust Investment Technology Institute Co., Ltd.,
Chairman and Director of The Bank of Tokyo-Mitsubishi UFJ, Ltd.) but there are no special interest relationships between outside au-
as an outside director, but there are no special interest relationships ditor Matsuda and the Company.
between the Company and Mr. Kuroyanagi. Outside auditor Koukei Higuchi attended 8 of the 10 meetings
There are no special interest relationships between the Company of the Board of Directors meetings and 12 of the 13 meetings of
and outside director Kensaku Hogen. Please note that outside direc- the Board of Auditors held during the fiscal year under review, and
tor Hogen attended all 10 meetings of the Board of Directors held he made necessary and appropriate statements during the deliber-
during the fiscal year under review, and he made necessary and ap- ation of proposals.
propriate statements during the deliberation of proposals. Outside auditor Fumihiko Saito attended 9 of the 10 meetings of
The Company provides information on the Board of Directors the Board of Directors and all 13 meetings of the Board of Auditors
meetings and other matters to outside directors as necessary. held during the fiscal year under review, and he made necessary and
appropriate statements during the deliberation of proposals.
■ Outside Corporate Auditors Outside auditor Yuji Matsuda attended all 10 meetings of the
The Company has appointed outside corporate auditor Koukei Board of Directors and all 13 meetings of the Board of Auditors
Higuchi to receive audit information on its corporate activities from a held during the fiscal year under review, and he made necessary
broad-ranging and advanced viewpoint based on his extensive ex- and appropriate statements during the deliberation of proposals.
perience and a high level of insight in corporate management. The Company provides information on the Board of Directors
The Company has appointed outside corporate auditor Fumi- meetings and other information to the outside auditors as necessary.
hiko Saito to receive audit information on its corporate activities
from a broad-ranging and advanced viewpoint based on his exten-
sive experience and a high level of insight in legal affairs.

6. Provisions of the Articles of Incorporation

■ Items Approved by the General Meeting of Shareholders more and two-thirds or more of those present vote in favor of the
that Can Then Be Decided by the Board of Directors decision.
The Articles of Incorporation provide that the Board of Directors This provision was included to make certain that a majority of
may make decisions regarding the payment of dividends from sur- voting shares are represented for making special decisions at the
plus and other sources. (The Company has a policy that the final General Meeting of Shareholders.
dividend for the fiscal year is determined by a decision of the Regu-
lar General Meeting of Shareholders.) This provision enables man- ■ Requirements for Deciding on the Election of Directors
agement to implement capital policy and dividend policy with The Articles of Incorporation provide that decisions on the election
greater flexibility. of candidates for director can be made if a quorum of shareholders
are present who can exercise voting rights of one-third or more and
■ Requirements for Special Decisions by the General a majority vote in favor of the election. Cumulative voting is not al-
Meeting of Shareholders lowed in making decisions on the election of directors.
The Articles of Incorporation provide that special decisions can be
made at the General Meeting of Shareholders if a quorum of share- ■ Number of Directors
holders are present who can exercise voting rights of one-third or The Articles of Incorporation provide for up to 30 directors.
7. Status of Measures Related to Shareholders and Others with Vested Interests

■ Measures to Invigorate Ordinary General Meetings of ■ IR Activities
Shareholders and Ensure the Smooth Exercise of For analysts and institutional investors, the Company holds meet-
Voting Rights
ings to present its results four times a year and meetings with the
To invigorate the annual Ordinary General Meeting of Shareholders, president twice a year. Company representatives visit and hold in-
the Company holds the meeting as early as possible. The Compa- formation meetings as needed for major Japanese and overseas
ny also presents easy-to-understand reports using videos and institutional investors to explain the Honda Group’s future business
slides, and displays its products in the conference room. strategies. Representatives based in North America and Europe
The Company sends convocation notices before the date re- also hold information meetings for institutional investors as appro-
quired by law, and also allows shareholders to exercise their voting priate. In addition, the Company holds information meetings for in-
rights via the Internet, using personal computers or mobile phones. vestors at motor shows and other major events, where presenta-
Convocation notices are sent in English to overseas investors. tions on such topics as Honda Group strategies are made by the
In these and other ways, the Company strives to make the ex- president or relevant director. Moreover, the Company conducts
ercise of rights as smooth as possible. regular tours of facilities in Japan and overseas for shareholders
and other investors.
The latest information for investors is available on the Compa-
ny’s website (http://www.honda.co.jp/investors/ in Japanese;
http://world.honda.com/investors/ in English). All new information
is uploaded to the site simultaneously in Japanese and English.
The Company issues a regular publication for shareholders,
containing information about its businesses, products, financial
status, and other matters.

■ Respecting the Perspective of Stakeholders law. We also publish yearly reports on environmental protection ac-
Seeking to earn the unwavering trust of customers and society, tivities, safe driving campaigns, and social contribution activities,
the Honda Group has formulated a set of behavioral guidelines, which are posted on our website. In addition, we publish a corpo-
which is observed by all individual associates (employees). rate social responsibility (CSR) report that comprehensively explains
In addition to supplying products incorporating the most ad- our activities related to the environment, safety, and society.
vanced safety and environmental technologies, the Company
pursues environmental protection activities, safe driving cam- ■ Disclosure of Corporate Information
paigns, and social contribution activities covering all aspects of To deliberate the accuracy and appropriateness of corporate infor-
its operations, including production, logistics, and sales. These mation that is disclosed through announcements of the closing of
initiatives reflect the Company’s effort to earn the trust and un- accounts and other financial reports, the Company has formed the
derstanding of society via its corporate activities. Disclosure Committee, which is composed of directors responsible
The Company provides information about its corporate ac- for disclosure and other members.
tivities via financial reports and other disclosures according to
8. Directors’ Remuneration
The total amount of remuneration and bonuses of directors and cor- Bonuses for directors and corporate auditors are paid based
porate auditors is determined according to criteria that reflect their on a decision of the Ordinary General Meeting of Shareholders,
performance in the Company. taking into consideration the Company’s profits during the fiscal
Remuneration for directors and corporate auditors is paid based year, past bonuses paid, and various other factors.
on criteria approved by the Board of Directors, and it is paid within
the extent of the maximum amount resolved by the Ordinary General
Meeting of Shareholders.
(Millions of yen)
Directors Corporate Auditors Total

Type of remuneration
Number Amount Number Amount Number Amount
Director/corporate
auditor remuneration 21 724 7 123 28 848
Director/corporate
auditor bonuses 21 265 5 27 26 293
Total — 990 — 151 — 1,141
Notes:
1. The upper limit on directors’ and corporate auditors’ compensation is ¥90 million per month for services as director and, for corporate auditors, ¥18 million per month for
services as auditor.
2. The figures in the table above are for services as director or corporate auditor for the fiscal year under review. The amount shown for director/corporate auditor remuneration
is the amount paid during the year under review. The amount shown for director/corporate auditor bonuses is the provision to the reserve for directors/corporate auditors
bonuses for the year under review.
3. In addition to the figures in the table above, the Company bore costs of ¥103 million related to retirement payments to 20 directors and ¥17 million related to retirement
payments to 6 corporate auditors. Please note that the Company eliminated its system for retirement payments to directors and corporate auditors as of the closing of the
Annual General Meeting of Shareholders (the 84th general meeting) held on June 24, 2008, and the decision was made to pay the amount of such retirement payments
accrued through that shareholders’ meeting as a sole and final retirement allowance payment.
Please note that the total compensation and other costs paid to
the two outside directors and the three outside auditors applicable
to the fiscal year under review was ¥67 million.

Companies listed on the New York Stock Exchange (NYSE) must The following table shows the significant differences between
comply with certain standards regarding corporate governance un- the corporate governance practices followed by U.S. listed compa-
der Section 303A of the NYSE Listed Company Manual. nies under Section 303A of the NYSE Listed Company Manual and
However, listed companies that are foreign private issuers, those followed by Honda.
such as Honda, are permitted to follow home-country practice in
lieu of certain provisions of Section 303A.
Corporate Governance Practices Followed by NYSE- Corporate Governance Practices Followed by Honda
Listed U.S. Companies
An NYSE-listed U.S. company must have a majority of directors meeting the For Japanese companies that employ a corporate governance system based on
independence requirements under Section 303A of the NYSE Listed Company a board of corporate auditors (the “corporate auditor system”), including Honda,
Manual. Japan’s Company Law has no independence requirement with respect to
directors. The task of overseeing management and, together with the
accounting audit firm, accounting is assigned to the corporate auditors, who are
separate from the company’s management and meet certain independence
requirements under Japan’s Company Law. In the case of Japanese companies
that employ the board of corporate auditors system, including Honda, at least
half of the corporate auditors must be “outside” corporate auditors who must
meet additional independence requirements under Japan’s Company Law. An
outside corporate auditor is defined as a corporate auditor who has not served
as a director, accounting councilor, executive officer, manager, or any other
employee of the company or any of its subsidiaries. Currently, Honda has three
outside corporate auditors which constitute 60% of Honda’s corporate auditors.
An NYSE-listed U.S. company must have an audit committee composed entirely Like a majority of Japanese listed companies, Honda employs the board of
of independent directors, and the audit committee must have at least three corporate auditors system as described above. Under this system, the board of
members. corporate auditors is a legally separate and independent body from the board of
directors. The main function of the board of corporate auditors is similar to that
of independent directors, including those who are members of the audit
committee, of a U.S. company: to monitor the performance of the directors, and
review and express an opinion on the method of auditing by the company’s
accounting audit firm and on such accounting audit firm’s audit reports, for the
protection of the company’s shareholders.
Japanese companies that employ the board of corporate auditors system,
including Honda, are required to have at least three corporate auditors.
Currently, Honda has five corporate auditors. Each corporate auditor has a four-
year term. In contrast, the term of each director of Honda is one year.
With respect to the requirements of Rule 10A-3 under the U.S. Securities
Exchange Act of 1934 relating to listed company audit committees, Honda relies
on an exemption under that rule which is available to foreign private issuers with
boards of corporate auditors meeting certain criteria.
An NYSE-listed U.S. company must have a nominating/corporate governance Honda’s directors are elected at a meeting of shareholders. Its Board of
committee composed entirely of independent directors. Directors does not have the power to fill vacancies thereon. Honda’s corporate
auditors are also elected at a meeting of shareholders. A proposal by Honda’s
Board of Directors to elect a corporate auditor must be approved by a resolution
of its Board of Corporate Auditors. The Board of Corporate Auditors is
empowered to request that Honda’s directors submit a proposal for election of a
corporate auditor to a meeting of shareholders. The corporate auditors have the
right to state their opinion concerning election of a corporate auditor at the
meeting of shareholders.
An NYSE-listed U.S. company must have a compensation committee Maximum total amounts of compensation for Honda directors and corporate
composed entirely of independent directors. auditors are proposed to, and voted on, by a meeting of shareholders. Once the
proposals for such maximum total amounts of compensation are approved at
the meeting of shareholders, each of the Board of Directors and Board of
Corporate Auditors determines the compensation amount for each member
within the respective maximum total amounts.
An NYSE-listed U.S. company must generally obtain shareholder approval with Currently, Honda does not adopt stock option compensation plans. When
respect to any equity compensation plan. Honda adopts it, it must obtain shareholder approval for stock options only if
the stock options are issued with specifically favorable conditions or price
concerning the issuance and exercise of the stock options.

Board of Directors, Corporate Auditors and Operating Officers
Front row: Chairman and President and Executive Vice President and
Representative Director Representative Director Representative Director
Satoshi Aoki Takanobu Ito Koichi Kondo
Back row: Senior Managing Senior Managing Senior Managing Senior Managing Senior Managing
Director Director Director Director Director
Akio Hamada Mikio Yoshimi Atsuyoshi Hyogo Shigeru Takagi Tetsuo Iwamura

Directors
Chairman and Representative Director Satoshi Aoki
President and Representative Director Takanobu Ito President and Director of Honda R&D Co., Ltd.
Executive Vice President and Representative Director Koichi Kondo
Senior Managing Director Atsuyoshi Hyogo Chief Operating Officer for Regional Operations (China)
President of Honda Motor (China) Investment Corporation, Limited
Senior Managing Director Mikio Yoshimi Compliance Officer

Government & Industrial Affairs
Senior Managing Director Shigeru Takagi Chief Operating Officer for Regional Operations (Europe, the Middle & Near East and Africa)
President and Director of Honda Motor Europe Limited
Senior Managing Director Akio Hamada Chief Operating Officer for Production Operations
Risk Management Officer
General Supervisor, Quality
General Supervisor, Information Systems
Senior Managing Director Tetsuo Iwamura Chief Operating Officer for Regional Operations (North America)
President and Director of Honda North America, Inc.
President and Director of American Honda Motor Co., Inc.
Managing Director Tatsuhiro Oyama Chief Operating Officer for Motorcycle Operations
Managing Director Fumihiko Ike Chief Operating Officer for Regional Operations (Asia & Oceania)
President and Director of Asian Honda Motor Co., Ltd.
Managing Director Masaya Yamashita Chief Operating Officer for Purchasing Operations
Director Kensaku Hogen
Director Nobuo Kuroyanagi
Director and Advisor Takeo Fukui
Director Hiroshi Kobayashi Chief Operating Officer for Regional Sales Operations (Japan)
Director Sho Minekawa Chief Operating Officer for Regional Operations (Latin America)
President and Director of Honda South America Ltda.
President and Director of Moto Honda da Amazonia Ltda.
President and Director of Honda Automoveis do Brasil Ltda.
Director Hiroshi Soda Chief Operating Officer for Business Support Operations
Chief Officer of Driving Safety Promotion Center
Corporate Communications
Director Takuji Yamada Chief Operating Officer for Power Product Operations
Director Yoichi Hojo Chief Operating Officer for Business Management Operations
Director Tsuneo Tanai Chief Operating Officer for Automobile Operations
Director Hiroyuki Yamada Chief Operating Officer for Customer Service Operations
Note: Mr. Kensaku Hogen and Mr. Nobuo Kuroyanagi satisfy the required conditions for the outside director provided for in Article 2, Paragraph 1, Item 15 of the
Company Law.
Corporate Auditors
Corporate Auditor (Full-time) Toru Onda
Corporate Auditor (Full-time) Hideki Okada
Corporate Auditor Koukei Higuchi Advisor of the Board of Tokio Marine & Nichido Fire Insurance Co., Ltd.
Corporate Auditor Fumihiko Saito Representative of the Saito Law Office
Corporate Auditor Yuji Matsuda President and Director of Mitsubishi UFJ Trust Investment Technology Institute Co., Ltd.
Note: Corporate auditors Mr. Koukei Higuchi, Mr Fumihiko Saito, and Mr. Yuji Matsuda are outside corporate auditors as provided for in Article 2, Paragraph 1, Item 16 of the
Company Law.

Board of Directors, Corporate Auditors and Operating Officers
Operating Officers
Managing Officer Suguru Kanazawa Executive Vice President and Director of Honda Motor Europe Limited
President and Director of Honda of the U.K. Manufacturing Ltd.
Managing Officer Hidenobu Iwata President and Director of Honda of America Mfg., Inc.
Operating Officer Manabu Nishimae President and Director of Honda Canada Inc.
Operating Officer Koichi Fukuo Quality, Certification & Regulation Compliance
Operating Officer Masahiro Takedagawa President and Director of Honda Siel Cars India Limited
President and Director of Honda Motor India Private Ltd.
Operating Officer Yoshiyuki Matsumoto General Manager of Suzuka Factory of Production Operations
Operating Officer Eiji Okawara President and Director of Honda Engineering Co., Ltd.
Operating Officer Ko Katayama General Manager of Saitama Factory of Production Operations
Operating Officer Masahiro Yoshida General Manager of Hamamatsu Factory of Production Operations
Operating Officer Seiji Kuraishi President of Dongfeng Honda Automobile Co., Ltd.
Operating Officer Takashi Nagai Executive Vice President of Asian Honda Motor Co., Ltd.
Operating Officer Katsushi Watanabe General Manager of Kumamoto Factory of Production Operations
Operating Officer Toshiaki Mikoshiba Russia and other CIS contries for Regional Operations (Europe, the Middle & NearEast and Africa)
Executive Vice President and Director of Honda Motor Europe Limited
Operating Officer Yoshi Yamane General Manager of Corporate Project of the Company
Production for Regional Operations (China)
Operating Officer Takashi Sekiguchi Executive Vice President of American Honda Motor Co., Inc.
Operating Officer Takahiro Hachigo General Manager of Automobile Purchasing Division 2 in Purchasing Operations
Operating Officer Hiroshi Sasamoto Manufacturing of Honda Canada Inc.
Operating Officer Chitoshi Yokota Automobile Products for Automobile Operations
Operating Officer Michimasa Fujino President and Director of Honda Aircraft Company, Inc.
Note: The Company has introduced an operating officer system to facilitate transfer of authority to regions and local workplaces and effectively separate the supervisory
and executive roles, while also making the Board of Directors more versatile.

Financial Section
Financial Review 50
Consolidated Balance Sheets 64
Consolidated Statements of Income 66
Consolidated Statements of Stockholders’
Equity and Comprehensive Income 67
Consolidated Statements of Cash Flows 69
Segment Information 70
Basis of Translating Financial Statements 75
Consolidated Balance Sheets Divided into
Non-Financial Services Businesses and Finance Subsidiaries 76
Consolidated Statements of Cash Flows Divided into
Non-Financial Services Businesses and Finance Subsidiaries 77
Financial Summary 79
Selected Quarterly Financial Data 80

Financial Review
Operating and Financial Review Cost reductions and the effect of raw material fluctuations
Net Sales and Other Operating Revenue had a negative impact of ¥182.5 billion, due mainly to
Honda’s consolidated net sales and other operating revenues increased raw materials costs, such as steel and precious
(hereafter, “net sales”) for the fiscal year ended March 31, grade metals, and an increase in fixed costs per unit as a result
2009, decreased ¥1,991.5 billion, or 16.6%, to ¥10,011.2 of reduced production, which was offset by continuing cost
billion from the fiscal year ended March 31, 2008, primarily due reductions.
to foreign currency translation effects and decreased net sales Selling, general and administrative expenses had a negative
in the automobile business. Honda estimates that by applying impact of ¥88.3 billion due mainly to expenses related to
Japanese yen exchange rates of the previous fiscal year to the withdrawal from some racing activities and cancellations of
current fiscal year, net sales for the year would have decreased development new models and an increase in provisions for
by approximately ¥795.8 billion, or 6.6%, compared to the credit losses and losses on lease residual values in the financial
decrease as reported of ¥1,991.5 billion, which includes services business in North America, which was offset by a
negative foreign currency translation effects. decrease in costs for product warranties.
Net sales in Japan decreased ¥139.2 billion, or 8.8%, to R&D expenses also had a positive impact of ¥24.7 billion,
¥1,446.5 billion from the previous fiscal year and overseas net due mainly to reduction of R&D expenses, which was offset by
sales decreased ¥1,852.3 billion, or 17.8%, to ¥8,564.7 billion increased R&D expenses related to safety and environmental
from the previous fiscal year. technologies and enhancement of the attractiveness of the
products.
Operating Income With respect to the discussion above of the changes in
Operating income decreased ¥763.4 billion, or 80.1%, to operating income, management identified the factors set forth
¥189.6 billion from the previous fiscal year. Excluding negative below and used what it believes to be a reasonable method to
foreign currency effects of ¥269.5 billion, caused by the analyze the respective changes in such factors. Each of these
appreciation of the Japanese yen, Honda estimates operating factors is explained below. Management analyzed changes in
income decreased ¥493.8 billion, or 51.8%. these factors at the levels of the Company and its material
Factors contributing to the decrease of ¥493.8 billion in consolidated subsidiaries.
operating income excluding negative foreign currency effects (1) “Foreign currency effects” consist of “translation
can be summarized as follows (i) changes in net sales and the adjustments”, which come from the translation of the
model mix, (ii) cost reductions and the effect of raw material currency of foreign subsidiaries’ financial statements into
cost fluctuations, (iii) changes in selling, general and Japanese yen, and “foreign currency adjustments”, which
administrative (SG&A) expenses and (iv) R&D expenses. Details result from foreign-currency-denominated sales. With
regarding these factors are as follows. respect to “foreign currency adjustments”, management
Changes in net sales and the model mix had a negative analyzed foreign currency adjustments primarily related to
impact of ¥247.7 billion, due mainly to a decrease in income the following currencies: U.S. dollar, Canadian dollar, Euro,
attributable to the decreased net sales and changes in the British pound, Brazilian real and Japanese yen, at the level
model mix caused by shift of customers’ demands towards of the Company and its material consolidated subsidiaries.
more fuel efficient (compact) models in automobile business, (2) With respect to “cost reduction and effects of raw material
which was offset by price increases and reduced sales cost fluctuations”, management analyzed cost reduction
incentives in automobile business in North America. and effects of raw material cost fluctuations at the levels of
the Company and its material foreign manufacturing
subsidiaries in North America, Europe and other regions.
Net Sales and Other Operating (3) With respect to “changes in net sales and the model mix”,
Revenue management analyzed changes in sales volume and the mix
Years ended March 31 of product models sold in major markets which resulted in
Yen (billions) increases/decreases in profit, as well as certain other
reasons for increases/decreases in net sales and cost of
12,000
sales.
10,000
(4) With respect to “selling, general and administrative
expenses”, management analyzed reasons for increases/
8,000 decreases in selling, general and administrative expenses
from the previous fiscal year excluding currency translation
6,000 effects.
4,000 Income before Income Taxes, Minority Interest and

Equity in Income of Affiliates
2,000 Income before income taxes, minority interest and equity in
income of affiliates decreased ¥734.1 billion, or 81.9%, to
0 ¥161.7 billion. Main factors of this decrease, except factors
05 06 07 08 09 relating to operating income, are as follows;
Unrealized gains and losses related to derivative instruments,
such as interest rate swaps of finance subsidiaries, had a
positive impact of ¥85.7 billion. On the other hand, realized
losses related to derivative instruments and the losses Business Segments
associated with the revaluation of investment securities had a Motorcycle Business
negative impact of ¥56.4 billion, which was offset by the effects Honda’s unit sales of motorcycles, all-terrain vehicles (ATVs)
of foreign currency transaction gains. and personal watercraft (PWC) totaled 10,114 thousand units,
increased by 8.5% from the previous fiscal year. Unit sales in
Income Tax Expense Japan totaled 232 thousand units, decreased by 25.4%.
Income tax expense decreased ¥277.6 billion, or 71.7%, to Overseas unit sales totaled 9,882 thousand units, increased by
¥109.8 billion. The effective tax rate increased 24.7 percentage 9.7%, due mainly to an increase in unit sales of parts for local
points to 67.9%, from the previous year, which was higher than production at affiliates accounted for under the equity method
the Japanese statutory income tax rate of 40.0% by 27.9 in Asia and an increase in unit sales in Other Regions, including
percentage points. Brazil. Revenue from external customers decreased ¥147.1
billion, or 9.4%, to ¥1,411.5 billion from the previous fiscal year,
Minority Interest in Income of Consolidated Subsidiaries due mainly to negative foreign currency translation effects,
The amount deducted for minority interest in income of which was offset by increased overseas unit sales. Honda
consolidated subsidiaries decreased ¥13.3 billion, or 49.0%, to estimates that by applying Japanese yen exchange rates of the
¥13.9 billion from the previous fiscal year. previous fiscal year to the current fiscal year, net sales for the
year would have increased by approximately ¥18.5 billion, or
Equity in Income of Affiliates 1.2%, compared to the decrease as reported of ¥147.1 billion,
Equity in income of affiliates decreased ¥19.9 billion, or 16.7%, which includes negative foreign currency translation effects.
to ¥99.0 billion, due mainly to a decrease in income of affiliates Operating income decreased ¥51.3 billion, or 34.0%, to
that primarily manufacture components and parts for Honda’s ¥99.9 billion from the previous fiscal year, due mainly to
products in Japan, because of a decrease in their revenues, increased raw material costs, the negative foreign currency
which was partially offset by an increase in income of affiliates effects and increased SG&A expenses, which was offset by
in Asia, because of an increase in their revenues resulting from price increases and decreased R&D expenses.
further automobile market expansion.
Automobile Business
Net Income Honda’s unit sales of automobiles totaled 3,517 thousand
Net income decreased ¥463.0 billion, or 77.2%, to ¥137.0 units, decreased by 10.4% from the previous fiscal year. Unit
billion from the previous fiscal year. sales in Japan totaled 556 thousand units, decreased by 9.6%.
Overseas unit sales totaled 2,961 thousand units, decreased
by 10.5%, due mainly to a decrease in unit sales in North
America, which was offset by an increase in unit sales in Asia
Net Income and Net Income and Other Regions including Brazil.
per Common Share Revenue from external customers decreased ¥1,814.9
Years ended March 31 billion, or 19.1%, to ¥7,674.4 billion from the previous fiscal
Yen (billions) (Yen) year, due to the negative foreign currency translation effects
800 400 and decreased unit sales. Honda estimates that by applying
Japanese yen exchange rates of the previous fiscal year to the
current fiscal year, net sales for the year would have decreased
600 300 by approximately ¥889.9 billion, or 9.4%, compared to the
decrease as reported of ¥1,814.9 billion, which includes
negative foreign currency translation effects.
400 200 Operating income decreased ¥637.1 billion, or 96.3%, to
¥24.5 billion, from the previous fiscal year, due mainly to a
decrease in income attributable to the decreased net sales in
200 100 North America and Japan, the negative foreign currency
effects, an increase in fixed costs per unit as a result of
reduced production, increased raw material costs, changes in
0 0 the model mix caused by shift of customers’ demands towards
05 06 07 08 09 more fuel efficient (compact) models and expenses related to
Net Income (left) withdrawal from some racing activities and cancellations of
Net Income per Common Share development of new models, which was offset by continuing
(right)
cost reduction, price increases, a decrease in costs for product
warranties, decreased R&D expenses and reduced sales
incentives in North America.

Power Product and Other Businesses Our finance subsidiaries in North America have historically
Honda’s unit sales of power products totaled 5,187 thousand accounted for all leases as direct financing leases. However,
units, decreased by 14.4% from the previous fiscal year. Unit starting in the fiscal year ended March 31, 2007, some of the
sales in Japan totaled 516 thousand units, decreased by 6.2%. leases which do not qualify for direct financing leases
Overseas unit sales totaled 4,671 thousand units, decreased accounting treatment are accounted for as operating leases.
by 15.2%, due mainly to decreased unit sales in North America Generally, direct financing lease revenues and interest income
and Europe. Revenue from external customers decreased consist of the recognition of finance lease revenue at inception
¥78.1 billion, or 18.5%, to ¥343.0 billion from the previous of the lease arrangement and subsequent recognition of the
fiscal year, due mainly to the decreased unit sales and negative interest income component of total lease payments using the
foreign currency translation effects. Honda estimates that by effective interest method. In comparison, operating lease
applying Japanese yen exchange rates of the previous fiscal revenues include the recognition of the gross lease payment
year to the current fiscal year, net sales for the year would have amounts on a straight line basis over the term of the lease
decreased by approximately ¥49.0 billion, or 11.7%, compared arrangement, and operating lease vehicles are depreciated to
to the decrease as reported of ¥78.1 billion, which includes their estimated residual value on a straight line basis over the
negative foreign currency translation effects. term of the lease. It is not anticipated that the differences in
Operating loss was ¥15.4 billion, a decrease of ¥37.8 billion accounting for operating leases and direct financing leases will
of operating income from the previous fiscal year, due mainly to have a material net impact on Honda’s results of operations
a decrease in income attributable to the decreased net sales overall, however, operating lease revenues and associated
and increase in R&D expenses in other businesses, which was depreciation of leased assets do result in differing presentation
offset by decreased SG&A expenses. and timing compared to those of direct financing leases.
Financial Services Business Geographical Information

To support the sale of its products, Honda provides retail Japan
lending and leasing to customers and wholesale financing to In Japan, revenue from domestic and export sales decreased
dealers through our finance subsidiaries in Japan, the United 726.4 billion, or 14.9%, to ¥4,162.5 billion from the previous
States, Canada, the United Kingdom, Germany, Brazil, Thailand fiscal year, due mainly to a decrease in revenue in automobile
and other countries. business. Operating loss was ¥161.6 billion, a decrease of
In North America, the financial crisis had a severe impact on ¥354.1 billion of operating income from previous fiscal year,
the economy, the deterioration in employment conditions, due mainly to negative foreign currency effects, a decrease in
deterioration in consumer sentiment and other factors. As a income attributable to the decreased revenue, increased raw
result, the environment for financial services business remained material costs, an increase in fixed costs per unit as a result of
under pressure. reduced production and expenses related to withdrawal from
Total amount of finance subsidiaries-receivables and property some racing activities and cancellations of development of new
on operating leases of finance subsidiaries decreased by 2.2%, models, which was offset by continuing cost reductions,
to ¥4,860.1 billion from the previous fiscal year, due mainly to decreased SG&A and R&D expenses.
the currency translation effects.
Revenue from external customers in a financial services North America
business increased ¥48.7 billion, or 9.1%, to ¥582.2 billion In North America, which mainly consists of the United States,
from the previous fiscal year, due mainly to an increase in revenue decreased ¥1,486.1 billion, or 23.7%, to ¥4,779.1
operating lease revenue, which was offset by negative foreign billion from the previous fiscal year, due mainly to negative
currency translation effects. Honda estimates that by applying foreign currency translation effects and a decrease in revenue
Japanese yen exchange rates of the previous fiscal year to the in automobile business. Operating income decreased ¥352.9
current fiscal year, revenue for the year would have increased billion, or 81.6%, to ¥79.7 billion from the previous fiscal year,
by approximately ¥124.7billion, or 23.4%, compared to the due mainly to a decrease in income attributable to the
increase as reported of ¥48.7 billion, which includes negative decreased revenue, an increase in fixed costs per unit as a
foreign currency translation effects. result of reduced production, negative foreign currency effects,
Operating income decreased ¥37.1 billion, or 31.5%, to and increased raw material costs, which was offset by
¥80.6 billion from the previous fiscal year, due mainly to an continuing cost reductions and decreased SG&A expenses.
increase in provisions for credit losses and losses on lease
residual values in North America and negative foreign currency Europe
translation effects, which was offset by an increase in income In Europe, revenue decreased ¥315.3 billion, or 19.8% to
attributable to higher revenue. In North America, prices of SUVs ¥1,278.9 billion from the previous fiscal year, due mainly to
and minivans in the used car market dropped during the fiscal negative foreign currency translation effects and a decrease in
first half, and losses on lease residual values of these models revenue in the motorcycle business and automobile business.
increased. In addition, from September onward, losses on Operating income decreased ¥41.3 billion, or 80.2%, to ¥10.2
lease residual values of compact and mid-sized sedans and billion from the previous fiscal year, due mainly to a decrease in
other passenger vehicles also increased. In addition, provisions income attributable to the decreased revenue, increased SG&A
for credit losses also increased as the ability of certain expenses, an increase in fixed costs per unit as a result of
customers to pay their debts declined. reduced production and increased raw material costs, which
was offset by continuing cost reductions.

Asia introduced its PGM-FI electronic fuel injection systems on its
In Asia, revenue decreased ¥30.0 billion, or 1.8% to ¥1,608.2 fully redesigned 50cc Monkey leisure model and its SHADOW
billion from the previous fiscal year, due mainly to negative Classic 400 cruiser model as well as its new model SHADOW
foreign currency translation effects, which was offset by Custom 400. These systems further improve environmental
increase in revenue in automobile business. Operating income performance and contribute to a superior start-up and a
decreased ¥27.1 billion, or 20.7%, to ¥103.6 billion from the smooth ride. Moreover, Honda has converted both its
previous fiscal year, due mainly to negative foreign currency combined brake system for front and rear wheels and its
effects, increased raw material costs and increased SG&A anti-lock braking system to electronic operation for more-
expenses. precise control and developed the world’s first electronically
controlled “Combined ABS,” which is an advanced system that
Other Regions greatly increases the feeling of security when braking. This
In Other Regions, revenue increased ¥51.4 billion, or 4.7%, to system has been installed on the CBR1000RR ABS super
¥1,144.2 billion from the previous fiscal year, due mainly to an sports model and the CBR600RR ABS, which have been newly
increase in revenue in all businesses, which was offset by a introduced on the market. In addition, in Brazil, Honda has
decrease in negative foreign currency translation effects. newly launched the CG150 TITAN MIX motorcycle equipped
Operating income increased ¥18.5 billion, or 16.0%, to ¥135.0 with its flexible-fuel technology that makes possible the use of
billion from the previous fiscal year, due mainly to an increase in any ratio of bioethanol and gasoline. This is the first motorcycle
income attributable to an increase in revenue and continuing in the world to offer this feature.
cost reductions, which was offset by increased SG&A R&D expenses in the Motorcycle Business segment in fiscal
expenses and increased raw material costs. 2009 totaled ¥83.6 billion.
Research and Development Automobile Business

Honda and its consolidated subsidiaries use the most In the Automobile Business segment, we work to develop
advanced technologies to conduct R&D activities aimed at innovative technologies and products through creativity-
creating distinctive products that are internationally competitive. oriented development in response to customer needs. We are
The Group’s main R&D divisions operate independently as also actively developing technologies that address
subsidiaries, allowing technicians to pursue their tasks with environmental issues and provide advanced safety
significant freedom. Product-related R&D is spearheaded by performance.
Honda R&D Co., Ltd.; Honda R&D Americas, Inc. in the United Major achievements in Japan during the fiscal year 2009
States; and Honda R&D Europe (Deutschland) GmbH in included the introduction of the new FREED, a compact
Germany. R&D on production technologies centers around minivan that offers a compact body size as well as a roomy and
Honda Engineering Co., Ltd. in Japan and Honda Engineering comfortable interior. Also, Honda implemented full model
North America, Inc. All of these entities work in close changes for the Odyssey and Accord and equipped these
association with our other entities and businesses in their models with its Motion Adaptive Electric Power Steering Assist
respective regions. system, which provides driving stability support by stabilizing
Total consolidated R&D expenses for the year ended March the steering motion when vehicle behavior becomes unstable
31, 2009 amounted to ¥563.1 billion. due to cornering or changes in road conditions. In addition,
Honda carried out a full model change on the Life and
Motorcycle Business equipped it with the world’s first i—SRS air-bag system for the
In the motorcycle business, Honda is committed to developing driver’s seat with continuously staged inflation, which offers a
products with new value-added features that meet the high degree of protection and low impact for passengers
individual needs of customers around the world, and to through continuous variability of the air-bag capacity and
implementing the timely local development of products tailored emission control. Moreover, Honda introduced the Insight, its
to specific regions at its overseas locations. At the same time, new model hybrid car, equipped with Honda’s lightweight,
we are focusing on developing industry-leading technologies compact hybrid system and Eco Assist (Ecological Drive
that address safety and environmental issues. Assist System), which offer superior eco-performance and a
Major developments in Japan in fiscal 2009 included the comfortable ride. Additionally, Honda commenced the
development of Japan’s first built-in type navigation system for production of the FCX Clarity, a new model fuel cell vehicle,
motorcycles. The system is designed to be positioned below and began to lease these vehicles in Japan in November 2008
the meters for best legibility and visibility for the driver and, for and in the United States in July 2008.
safety, the navigation system can be operated as the rider R&D expenses in the Automobile Business segment in fiscal
continues to hold the handles. These systems have been 2009 totaled ¥422.3 billion.
installed on a limited basis on Honda’s GOLDWING AIRBAG
NAVI sports touring motorcycle. In addition, Honda has

Power Product and Other Businesses developed information extraction technology to devise
In the Power Product Business, we are seeking to develop systems that will enable the control of robots by human
products that match customers’ lifestyles and needs while thought alone. Looking to the future, this technology will be
strengthening our lineup of offerings that address further developed for application to human-friendly products
environmental issues. by integrating it with intelligent technologies and/or robotic
Important developments in this segment in Japan during the technologies.
fiscal year included expanding the product lineup and sales Expenses incurred in fundamental research are distributed
coverage of solar cell batteries manufactured by a Honda among Honda’s business segments.
subsidiary, which is engaged in the production and marketing of
these batteries. In view of the rising concern in Japan about
environmental issues, coverage was extended on a nationwide
R&D Expenses and R&D Expenses
basis to include not only units for use in households but also
as a Percentage of Net Sales
thin-film solar batteries for the public sector and industry. Also in Years ended March 31
the power product operations in Japan, Honda introduced the
Yen (billions) (%)
Yukios SB800, which is a compact and lightweight snow
600 6
removal device that clears snow without blowing it from one
place to another and can be used easily, even by beginners.
Also, in Japan, Honda introduced the Pianta FV200, a gas-
powered mini-tiller that uses the same butane gas canisters that
400 4
are already in wide use among households for powering
portable gas stoves. This mini-tiller is easy to use, even for
beginners, and is suited to making home gardening easier and
more fun.
200 2
R&D expenses in this segment in fiscal 2009 totaled to
¥57.2 billion.
Fundamental Research
0 0
In the area of fundamental research, Honda is pursuing steady 05 06 07 08 09
and varied research activities into technologies that may lead R&D Expenses (left)
to innovative applications. R&D Expenses as a Percentage
One of Honda’s research initiatives is developmental work of Net Sales (right)
on a Walking Assist Drive, which can provide support for

persons whose legs have become weak. Honda is conducting
this research jointly with medical institutions and has Capital Expenditures
announced a test model. Going forward, Honda will be Capital expenditures in fiscal 2009 were applied to the
verifying the effectiveness of these devices in actual use. introduction of new models, upgrade, rationalize and renew
In another research area, Honda has decided to build a new production facilities, as well as to expand and reinforce sales
research facility with the aim of commercializing manufacturing and R&D facilities.
technologies for bioethanol produced from cellulose materials, Total capital expenditures for the year amounted to
including caulome, leaves, and other substances that are not ¥1,267.2 billion, down ¥226.0 billion from the previous year.
suited for consumption as food. Also, total capital expenditures, excluding property on
Additionally, Honda’s subsidiary, Honda Research Institute operating leases, for the year amounted to ¥599.1 billion,
Japan Co., Ltd., is conducting joint research on brain machine down ¥54.8 billion from the previous year. Spending by
interface (BMI) technology. These research activities are the business segment is shown below.
first in the world to combine electroencephalography and
near-infrared spectroscopy technologies as well as newly
Fiscal years ended March 31,

2008 2009 Increase (Decrease)
Yen (millions)
Motorcycle Business ¥ 86,687 ¥ 90,401 ¥ 3,714
Automobile Business 544,922 490,760 (54,162)
Financial Services Business 839,888 669,178 (170,710)
Financial Services Business (Excluding Property on Operating Leases) 627 1,050 423
Power Product and Other Businesses 21,794 16,920 (4,874)
Total ¥1,493,291 ¥1,267,259 ¥(226,032)
Total (Excluding Property on Operating Leases) ¥ 654,030 ¥ 599,131 ¥ (54,899)
Note: Intangible assets are not included in the table above.

In the motorcycle business, we made capital expenditures of The estimated amounts of capital expenditures for fiscal year
¥90,401 million in the fiscal year ended March 31, 2009. Funds ending March 31, 2010 are shown below.
were allocated to the introduction of new models, as well as the Fiscal year ending
improvement, streamlining and modernization of production March 31, 2010
facilities, and improvement of Sales and R&D facilities. The plan Yen (millions)
to consolidate motorcycle production in Japan at Kumamoto Motorcycle Business ¥ 47,100

Factory was completed in August 2008. Automobile Business 316,900
In the automobile business, we made capital expenditures of Financial Services Business 500
¥490,760 million in the fiscal year ended March 31, 2009. Funds Power Product and Other Businesses 25,500
were allocated to the introduction of new models, as well as the
Total ¥390,000
improvement, streamlining and modernization of production
Notes: The estimated amount of capital expenditures for Financial Services Business in
facilities, and improvement of Sales and R&D facilities. Honda the above table does not include property on operating leases.
Canada Inc., which is one of the Company’s consolidated Intangible assets are not included in the table above.
subsidiaries, completed construction of its facilities for the
production of engines in September 2008. Honda Manufacturing
of Indiana, LLC and Honda Automobile (Thailand) Co., Ltd
completed construction of its facilities for the production of
Capital Expenditures and
automobiles in October 2008. Depreciation
In the financial services business segment, capital Years ended March 31
expenditures excluding property on operating leases amounted
Yen (billions)
to ¥1,050 million in the fiscal year ended March 31, 2009, while
600
capital expenditures for property on operating leases were
¥668,128 million. Capital expenditures in power products and
other businesses in the fiscal year ended March 31, 2009,
totaling ¥16,920 million, were deployed to upgrade, streamline,
400
and modernize manufacturing facilities for power products, and
to improve R&D facilities for power products.
Plans after Fiscal 2009

200
We set out our original capital expenditure plans for the period
from the fiscal year ended March 31, 2009 during the
preceding fiscal year. We have subsequently modified these
plans as follows: 0
The planned timing of the start of operation in 2010 on the 05 06 07 08 09
new auto plant in Yorii-machi Osato-gun, Saitama, Japan has Capital Expenditures
been postponed for more than two years. The planned timing Depreciation
of the start of operation on a new engine plant in Ogawa-machi
Hiki-gun, Saitama, Japan has not been changed.
The planned timing of the start of operation in 2010 on the
new R&D center in Sakura City, Tochigi, Japan has been
postponed.
The planned timing of the start of operation at the end of
2009 on the new auto plant of Honda Siel Cars India Limited,
which is one of the Company’s consolidated subsidiaries, in
Rajasthan, India has been postponed.
The planned timing of the start of operation in the latter half
of 2010 on the new auto plant capable of synchronous auto
production—from the engine to the entire automobile—of
Yachiyo Industry Co., Ltd., which is one of the Company’s
consolidated subsidiaries, in Yokkaichi City, Mie, Japan has
been postponed for a little over one year.

Liquidity and Capital Resources dividends paid. Cash inflows from financing activities decreased
Overview of Capital Requirements, Sources and Uses by ¥157.1 billion compared with the previous fiscal year.
The policy of Honda is to support its business activities by
maintaining sufficient capital resources, a sufficient level of Liquidity
liquidity and a sound balance sheet. The ¥690.3 billion in cash and cash equivalents at the end of
Honda’s main business is the manufacturing and sale of year corresponds to approximately 0.8 month of net sales, and
motorcycles, automobiles and power products. To support this Honda believes it has sufficient liquidity for its business
business, it also provides retail financing and automobile operations.
leasing services for customers, as well as wholesale financing At the same time, Honda is aware of the possibility that
services for dealers. various factors, such as recession-induced market contraction
Honda requires operating capital mainly to purchase parts and financial and foreign exchange market volatility, may
and raw materials required for production, as well as to adversely affect liquidity. For this reason, finance subsidiaries
maintain inventory of finished products and cover receivables that carry total short-term borrowings of ¥1,697.4 billion have
from dealers. Honda also requires funds for capital committed lines of credit equivalent to ¥864.5 billion that serve
expenditures, mainly to introduce new models, upgrade, as alternative liquidity for the commercial paper issued regularly
rationalize and renew production facilities, as well as to expand to replace debt. Honda believes it currently has sufficient credit
and reinforce sales and R&D facilities. limits, extended by prominent international banks as of the date
Honda meets its operating capital requirements primarily of the filing of Honda’s form 20-F.
through cash generated by operations, bank loans and the Honda’s short- and long-term debt securities are rated by
issuance of commercial paper. Year-end balance of liabilities credit rating agencies, such as Moody’s Investors Service, Inc.,
associated with the Company and its subsidiaries’ funding for Standard & Poor’s Rating Services, and Rating and Investment
non-financial services businesses was ¥766.6 billion as of Information, Inc. The following table shows the ratings of
March 31, 2009. In addition, the Company’s finance Honda’s unsecured debt securities by Moody’s, Standard &
subsidiaries fund those financial programs for customers and Poor’s and Rating and Investment Information as of March 31,
dealers primarily from corporate bonds, medium-term notes, 2009.
commercial paper, securitization of finance receivables and Credit Ratings for
intercompany loans. Year-end balance of liabilities associated Short-term Long-term
with these finance subsidiaries’ funding for financial services unsecured unsecured
debt securities debt securities
business was ¥4,515.8 billion as of March 31, 2009.
Moody’s Investors Service P-1 A1
Cash Flows Standard & Poor’s Rating Services A-1 A+
Consolidated cash and cash equivalents for the year ended Rating and Investment Information a-1+ AA
March 31, 2009 decreased by ¥360.5 billion from March 31,
The above ratings are based on information provided by
2008, to ¥690.3 billion. The reasons for the increases or
Honda and other information deemed credible by the rating
decreases for each cash flow activity are as follows.
agencies. They are also based on the agencies’ assessment of
Net cash provided by operating activities amounted to
credit risk associated with designated securities issued by
¥383.6 billion of cash inflows. Cash inflows from operating
Honda. Each rating agency may use different standards for
activities decreased by ¥743.2 billion compared with the
calculating Honda’s credit rating, and also makes its own
previous fiscal year, due mainly to a decrease in cash received
assessment. Ratings can be revised or nullified by agencies at
from customers, primarily due to lower unit sales in the
any time. These ratings are not meant to serve as a
automobile business in North America and an increase in
recommendation for trading in or holding Honda’s unsecured
inventories, which was offset by decreased payments for parts
debt securities.
and raw materials primarily due to a decrease in automobile
production and decreased payments for operating expenses.
Off-Balance Sheet Arrangements
Net cash used in investing activities amounted to ¥1,133.3
Special Purpose Entity
billion of cash outflows, due mainly to capital expenditures and
For the purpose of accelerating the receipt of cash related to
the purchase of operating lease assets (which exceeds
our finance receivables, we periodically securitize and sell pools
proceeds from sales of operating lease assets), which was
of these receivables. In these securitizations, we sell a portfolio
offset by collections of and proceeds from sales of finance
of finance receivables to a special purpose entity, which is
subsidiaries-receivables (which exceeded acquisitions of
established for the limited purpose of buying and reselling
finance subsidiaries-receivables). Cash outflows from investing
finance receivables. We remain as a servicer of the finance
activities decreased by ¥553.0 billion compared with the
receivables and are paid a servicing fee for our services. The
previous fiscal year, due mainly to a decrease in acquisitions of
special purpose entity transfers the receivables to a trust or
finance subsidiaries-receivables and the purchases of operating
bank conduit, which issues interest-bearing asset-backed
lease assets and an increase in proceeds from sales of finance
securities or commercial paper, respectively, to investors. We
subsidiaries-receivables and operating lease assets.
retain certain subordinated interests in the sold receivables in
Net cash provided by financing activities amounted to ¥530.8
the form of subordinated certificates, servicing assets and
billion of cash inflows, due mainly to proceeds from long-term
residual interests in certain cash reserves provided as credit
debt and increase in short-term debt (which exceeded
enhancements for investors. We apply significant assumptions
repayment of long-term debt), which was offset by cash
regarding prepayments, credit losses and average interest

rates in estimating expected cash flows from the trust or bank his/her loan payments, we are required to perform under the
conduit, which affect the recoverability of our retained interests guarantee. The undiscounted maximum amount of our
in the sold finance receivables. We periodically evaluate these obligation to make future payments in the event of defaults is
assumptions and adjust them, if appropriate, to reflect the ¥33.6 billion. As of March 31, 2009, no amount was accrued
performance of the finance receivables. for any estimated losses under the obligations, as it was
probable that the employees would be able to make all
Guarantee scheduled payments.
At March 31, 2009, we guaranteed ¥33.6 billion of employee
bank loans for their housing costs. If an employee defaults on
Tabular Disclosure of Contractual Obligations

The following table shows our contractual obligations at March 31, 2009:
Yen (millions)
Payments due by period
At March 31, 2009 Total Less than 1 year 1-3 years 3-5 years After 5 years
Long-term debt ¥2,910,160 ¥ 977,523 ¥1,037,624 ¥798,944 ¥ 96,069
Operating leases 128,673 26,776 34,700 19,142 48,055
Purchase commitments*1 144,874 144,874 — — —
Interest payments*2 326,718 159,012 120,991 44,140 2,575
Contributions to defined benefit pension plans*3 82,795 82,795 — — —
Total ¥3,593,220 ¥1,390,980 ¥1,193,315 ¥862,226 ¥146,699
*1 Honda had commitments for purchases of property, plant and equipment at March 31, 2009.
*2 To estimate the schedule of interest payments, the company utilized the balances and average interest rates of borrowings and debts and derivative instruments as of March 31,
2009.
*3 Since contributions beyond the next fiscal year are not currently determinable, contributions to defined benefit pension plans reflect only contributions expected for the next fiscal
year.
If our estimates of unrecognized tax benefits and potential tax benefits are not representative of actual outcomes, our consolidated
financial statements could be materially affected in the period We have identified the following critical accounting policies
of settlement or when the statutes of limitations expire, as we with respect to our financial presentation.
treat these events as discrete items in the period of resolution.
Since it is difficult to estimate actual payment in the future (Product Warranty)
related to our uncertain tax positions, unrecognized tax benefit We warrant our products for specific periods of time.
totaled ¥125,771 million is not represented in the table above. Product warranties vary depending upon the nature of the
At March 31, 2009, we had no material capital lease product, the geographic location of their sales and other
obligations or long-term liabilities reflected on our balance factors.
sheet under U.S. GAAP other than those set forth in the table We recognize costs for general warranties on products we
above. sell and product recalls. We provide for estimated warranty
costs at the time products are sold to customers or the time
Application of Critical Accounting Policies new warranty programs are initiated. Estimated warranty costs
Critical accounting policies are those which require us to apply are provided based on historical warranty claim experience with
the most difficult, subjective or complex judgments, often consideration given to the expected level of future warranty
requiring us to make estimates about the effect of matters that costs, including current sales trends, the expected number of
are inherently uncertain and which may change in subsequent units to be affected and the estimated average repair cost per
periods, or for which the use of different estimates that could unit for warranty claims. Our products contain certain parts
have reasonably been used in the current period would have manufactured by third party suppliers. Since suppliers typically
had a material impact on the presentation of our financial warrant these parts, the expected receivables from warranties
condition and results of operations. A sustained loss of of these suppliers are deducted from our estimates of accrued
consumer confidence which may be caused by continued warranty obligations.
economic slowdown, recession, rising fuel prices, financial We believe our accrued warranty liability is a “critical
crisis or other factors have combined to increase the accounting estimate” because changes in the calculation can
uncertainty inherent in such estimates and assumptions. materially affect net income, and require us to estimate the
The following is not intended to be a comprehensive list of all frequency and amounts of future claims, which are inherently
our accounting policies. uncertain.
Our policy is to continuously monitor warranty cost accruals
to determine the adequacy of the accrual. Therefore, warranty
expense accruals are maintained at an amount we deem
adequate to cover estimated warranty expenses.

Actual claims incurred in the future may differ from the The changes in provisions for those product warranties and
original estimates, which may result in material revisions to the net sales and other operating revenue for each business
warranty expense accruals. segment for each of the years in the three-year period ended
March 31, 2009 are as follows:
Yen (millions)
Fiscal years ended March 31 2007 2008 2009
Provisions for product warranties
Balance at beginning of year ¥ 283,947 ¥ 317,103 ¥ 293,760
Warranty claims paid during the period (113,454) (137,591) (123,509)
Liabilities accrued for warranties issued during the period 143,280 136,355 79,576
Changes in liabilities for pre-existing warranties during the period 605 (1,476) 2,233
Foreign currency translation 2,725 (20,631) (18,081)
Balance at end of year 317,103 293,760 233,979
Net sales and other operating revenue ¥11,087,140 ¥12,002,834 ¥10,011,241
(Credit Losses) We believe our allowance for credit losses is a “critical

Our finance subsidiaries provide wholesale financing to dealers accounting estimate” because it requires us to make
and retail lending and leasing to customers mainly in order to assumptions about inherently uncertain items such as future
support sales of our products, principally in North America. We economic trends, quality of finance subsidiaries receivables and
classify retail and direct financing lease receivables derived other factors. We review the adequacy of the allowance for
from those services as finance subsidiaries-receivables. credit losses, and the allowance for credit losses is maintained
Operating leases are classified as property on operating leases. at an amount that we deem sufficient to cover the estimated
Certain finance receivables related to sales of inventory are credit losses incurred on our owned portfolio of finance
included in trade receivables and other assets in the receivables. However, actual losses may differ from the original
consolidated balance sheets. estimates as a result of actual results varying from those
The majority of the credit risk is with consumer financing assumed in our estimates.
and to a lesser extent with dealer financing. To determine the As an example of the sensitivity of the allowance calculation,
overall allowance for credit loss amount, receivables are the following scenario demonstrates the impact that a deviation
segmented into pools with common characteristics such as in one of the primary factors estimated as a part of our
product and collateral types, credit grades, and original loan allowance calculation would have on the provision and
terms. For each of these pools, we estimate losses primarily allowance for credit losses. If we had experienced a 10%
based on our historic loss experiences, delinquency rates, increase in net credit losses during fiscal 2009 in our North
recovery rates and scale and composition of the portfolio, America portfolio, the provision for fiscal 2009 and the
taking factors into consideration such as changing economic allowance balance at the end of fiscal 2009 would have
conditions and changes in operational policies and procedures. increased by approximately ¥7.6 billion and ¥3.1 billion,
Estimated losses due to customer defaults on operating leases respectively. Note that this sensitivity analysis may be
are not recognized in the allowance for credit losses. These asymmetric, and are specific to the base conditions in fiscal
losses are recognized as a component of impairment losses on 2009.
operating leases.
Additional Narrative of the Change in Credit Loss

The following table shows information related to our credit loss experience in our North American portfolio:
Yen (billions)
Fiscal years ended March 31 2007 2008 2009
Charge-offs (net of recoveries) ¥ 26.2 ¥ 39.9 ¥ 44.4
Provision for credit losses 25.5 44.8 49.7
Allowance for credit losses 28.7 28.4 31.4
Ending receivable balance 4,351.8 3,890.4 3,396.4
Average receivable balance, net 4,330.8 4,317.0 3,864.7
Charge-offs as a % of average receivable balance 0.61% 0.93% 1.15%
Allowance as a % of ending receivable balance 0.66% 0.73% 0.93%

The provision for credit losses increased by ¥4.9 billion, or plus proceeds from insurance, if any. We estimate losses on
11%, reflecting the continued deterioration of the U.S. lease residual values by evaluating several different factors,
economy which has negatively affected certain customers’ including trends in historical and projected used vehicle values
ability to meet their contractual obligations despite the effect of and general economic measures.
exchange rate changes. Net charge-offs increased by ¥4.5 We also periodically test our operating leases for impairment
billion, or 11%. The ending allowance balance increased by under Statement of Financial Accounting Standards (SFAS) No.
¥3.0 billion, or 11%, reflecting the higher estimate of losses 144, “Accounting for the Impairment or Disposal of Long-Lived
incurred despite the effect of exchange rate changes. Assets”.
Losses due to customer defaults on operating leases are not Recoverability of operating leases to be held is measured by
recognized in the provision for credit losses. These losses are a comparison of the carrying amount of operating leases to
recognized as a component of impairment losses on operating future net cash flows (undiscounted and without interest
leases. Impairment losses recognized totaled ¥8.7 billion and charges) expected to be generated by the operating leases. If
¥5.8 billion for fiscal years 2009 and 2008, respectively. Higher such operating leases are considered to be impaired, the
losses are due to the increasing volume of leases that are impairment to be recognized is measured by the amount by
accounted for as operating leases. which the carrying amount of the operating leases exceeds the
estimated fair value of the operating leases.
(Losses on Lease Residual Values) We believe that our estimated losses on lease residual values
End-customers of leased vehicles typically have an option to is a “critical accounting estimate” because it is highly
buy the leased vehicle for the contractual residual value of the susceptible to market volatility and requires us to make
vehicle or to return the vehicle to our finance subsidiaries assumptions about future economic trends and lease residual
through the dealer at the end of the lease term. Likewise, values, which are inherently uncertain. We believe that the
dealers have the option to buy the vehicle returned by the assumptions used are appropriate. However actual losses
customer or to return the vehicle to our finance subsidiaries. incurred may differ from original estimates.
The likelihood that the leased vehicle will be purchased varies If future auction values for all Honda and Acura vehicles in
depending on the difference between the actual market value our North American direct financing lease portfolio as of March
of the vehicle at the end of the lease term and the contractual 31, 2009, were to decrease by approximately ¥10,000 per unit
value determined at the inception of the lease. Our finance from our present estimates, holding all other assumption
subsidiaries in North America have historically accounted for all constant, the total impact would be an increase in losses on
leases as direct financing leases. However, starting in the year lease residual values by approximately ¥0.6 billion. Similarly, if
ended March 31, 2007, some of the leases which do not future return rates for our existing portfolio of all Honda and
qualify for direct financing leases accounting treatment are Acura vehicles were to increase by one percentage point from
accounted for as operating leases. our present estimates, the total impact would be an increase in
We initially determine the contract residual values by using losses on lease residual values by approximately ¥0.1 billion.
our estimate of future used vehicle values, taking into With the same prerequisites shown above, the impacts to the
consideration data obtained from third parties. We are exposed operating lease portfolio would be approximately ¥2.5 billion
to risk of loss on the disposition of returned lease vehicles and ¥0.6 billion, which would be recognized over the remaining
when the proceeds from the sale of the vehicles are less than lease terms. Note that this sensitivity analysis may be
the contractual residual values at the end of the lease term. We asymmetric, and are specific to the base conditions in fiscal
periodically review the estimate of residual values. Downward 2009. Also, declines in auction values are likely to have a
adjustments are made for declines in estimated residual values negative effect on return rates which could affect the
that are deemed to be other-than-temporary. For direct sensitivities.
financing leases, our finance subsidiaries in North America
purchase insurance to cover a portion of the estimated residual (Fiscal Year 2009 Compared with Fiscal Year 2008)
value. The adjustments on the uninsured portion of the Despite a declining portfolio of direct financing leases and the
vehicle’s residual value are recognized as a loss in the period in effect of exchange rate changes, losses on lease residual
which the estimate changed. For vehicle leases accounted for values increased by ¥11.1 billion or 94% as a result of the
as operating leases, the adjustments to estimated residual declines in used vehicle prices. Despite the effect of exchange
values result in changes to the remaining depreciation expense rate changes, incremental depreciation increased by ¥11.6
to be recognized prospectively on a straight-line basis over the billion or 545% due to the increase in operating lease assets
remaining term of the lease. and declines in estimated residual values.
The primary components in estimating losses on lease Impairment losses of ¥9.7 billion were recognized in
residual values are the expected frequency of returns, or the accordance with Statement of Financial Accounting Standards
percentage of leased vehicles we expect to be returned by (SFAS) No. 144, “Accounting for the Impairment or Disposal of
customers at the end of the lease term, and the expected loss Long-Lived Assets” during the year.
severity, or the expected difference between the residual value
and the amount we receive through sales of returned vehicles

(Pension and Other Postretirement Benefits) plans. Our assumed discount rate and rate of salary increase
We have various pension plans covering substantially all of our as of March 31, 2009 were 6.9-8.0% and 1.5-6.4%,
employees in Japan and certain employees in foreign countries. respectively, and our assumed expected long-term rate of
Benefit obligations and pension costs are based on return for fiscal 2009 was 6.5-8.0% for foreign plans.
assumptions of many factors, including the discount rate, the We believe that the accounting estimates related to our
rate of salary increase and the expected long-term rate of pension plans is “critical accounting estimate” because
return on plan assets. The discount rate is determined mainly changes in these estimates can materially affect our financial
based on the rates of high quality corporate bonds or condition and results of operations.
governmental bonds currently available and expected to be Actual results may differ from our assumptions, and the
available during the period to maturity of the defined benefit difference is accumulated and amortized over future periods.
pension plans. The salary increase assumptions reflect our Therefore, the difference generally will be reflected as our
actual experience as well as near-term outlook. Honda recognized expenses and recorded obligations in future
determines the expected long-term rate of return based on the periods. We believe that the assumptions currently used are
investment policies. Honda considers the eligible investment appropriate, however, differences in actual expenses or
assets under investment policies, historical experience, changes in assumptions could affect our pension costs and
expected long-term rate of return under the investing obligations, including our cash requirements to fund such
environment, and the long-term target allocations of the various obligations.
asset categories. Our assumed discount rate and rate of salary The following table shows the effect of a 0.5% change in the
increase as of March 31, 2009 were 2.0% and 2.3%, assumed discount rate and the expected long-term rate of
respectively, and our assumed expected longterm rate of return return on our funded status, equity, and pension expense.
for the year ended March 31, 2009 was 4.0% for Japanese
Japanese Plans Yen (billions)

Assumptions Percentage point change (%) Funded status Equity Pension expense
Discount rate +0.5/–0.5 –87.0/+88.6 +40.9/–46.8 –4.5/+5.5
Expected long-term rate of return +0.5/–0.5 — — –3.8/+3.8
Foreign Plans Yen (billions)

Assumptions Percentage point change (%) Funded status Equity Pension expense
Discount rate +0.5/–0.5 –14.0/+16.9 +18.7/–20.9 –3.7/+4.2
Expected long-term rate of return +0.5/–0.5 — — –2.1/+2.1
*1 Note that this sensitivity analysis may be asymmetric, and are specific to the base conditions at March 31, 2009.
*2 Funded status for fiscal 2009 is affected by March 31, 2009 assumptions.
Pension expense for fiscal 2009 is affected by March 31, 2009 assumptions.
(Income Taxes) estimates of unrecognized tax benefits and potential tax

Honda adopted the provision of FASB Interpretation No. 48 benefits are not representative of actual outcomes, our
“Accounting for Uncertainty in Income Taxes” (FIN No. 48) on consolidated financial statements could be materially affected
April 1, 2007. Honda is subject to income tax examinations in in the period of settlement or when the statutes of limitations
many tax jurisdictions because Honda conducts its operations expire, as we treat these events as discrete items in the period
in various regions of the world. We recognize the tax benefit of resolution.
from an uncertain tax position based on the technical merits of
the position when the position is more likely than not to be
sustained upon examination. Benefits from tax positions that
meet the more likely than not recognition threshold are
measured at the largest amount of benefit that is greater than
50% likelihood of being realized upon ultimate resolution. We
performed a comprehensive review of any uncertain tax
positions in accordance with FIN No. 48.
We believe our accounting for tax uncertainties is a “critical
accounting estimate” because it requires us to evaluate and
assess the probability of the outcome that could be realized
upon ultimate resolution. Our estimates may change in the
future due to new developments.
We believe that our estimates and assumptions of
unrecognized tax benefits are reasonable, however, if our

Quantitative and Qualitative Disclosure About Market (Foreign Currency Exchange Rate Risk)
Risk Foreign currency forward exchange contracts and purchased
Honda is exposed to market risks, which are changes in foreign option contracts are used to hedge currency risk of sale
currency exchanges rates, in interest rates and in prices of commitments denominated in foreign currencies (principally
marketable equity securities. Honda is a party to derivative U.S. dollars).
financial instruments in the normal course of business in order Foreign currency written option contracts are entered into in
to manage risks associated with changes in foreign currency combination with purchased option contracts to offset
exchange rates and in interest rates. Honda does not hold any premium amounts to be paid for purchased option contracts.
derivative financial instruments for trading purposes. The tables below provide information about our derivatives
Honda adopted Statement of Financial Accounting related to foreign currency exchange rate risk as of March 31,
Standards (SFAS) No. 157, “Fair Value Measurements” effective 2008 and 2009. For forward exchange contracts and currency
April 1, 2008. This statement defines fair value as the price that options, the table presents the contract amounts and fair value.
would be received to sell an asset or paid to transfer a liability All forward exchange contracts and currency contracts to which
in an orderly transaction, and emphasizes that a fair value we are a party have original maturities of less than one year.
measurement should be determined based on the assumptions
that market participants would use in pricing an asset or
liability. The adoption of this statement did not have a material
impact on the Company’s consolidated financial position or
results of operations.
Foreign Exchange Risk

2008 2009
Yen (millions) Average Yen (millions) Average
Contract contractual Contract contractual
Fiscal years ended March 31 amounts Fair value rate (Yen) amounts Fair value rate (Yen)
Forward Exchange Contracts
To sell US$ ¥214,797 9,199 104.25 ¥182,941 (8,966) 93.33
To sell EUR 40,963 64 157.99 42,324 (2,086) 123.40
To sell CA$ 14,146 560 101.72 379 (5) 76.99
To sell GBP 70,227 2,739 207.07 49,681 (2,673) 133.42
To sell other foreign currencies 12,147 362 various 16,549 (387) various
To buy US$ 7,104 (196) 102.92 3,287 131 94.26
To buy other foreign currencies 2,272 (29) various 1,933 (11) various
Cross-currencies 254,189 (517) various 234,521 94 various
Total ¥615,845 12,182 ¥531,615 (13,903)
Currency Option Contracts

Option purchased to sell US$ ¥ 96,720 877 various ¥ 24,548 304 various
Option written to sell US$ 136,005 (502) various 51,551 (1,743) various
Option purchased to sell other currencies 17,378 409 various — — —
Option written to sell other currencies 22,101 (457) various — — —
Total ¥272,204 327 ¥ 76,099 (1,439)
(Interest Rate Risks) The following tables provide information about Honda’s
Honda is exposed to market risk for changes in interest rates financial instruments that were sensitive to changes in interest
related primarily to its debt obligations and finance receivables. rates at March 31, 2008 and 2009. For finance receivables and
In addition to short-term financing such as commercial paper, long-term debt, these tables present principal cash flows, fair
Honda has long-term debt with both fixed and floating rates. value and related weighted average interest rates. For interest
Our finance receivables are primarily fixed rate. Interest rate rate swaps and currency and interest rate swaps, the table
swap agreements are mainly used to manage interest rate risk presents notional amounts, fair value and weighted average
exposure and to convert floating rate financing (normally interest rates. Variable interest rates are determined using
three-five years) to fixed rate financing in order to match formulas such as LIBOR+ and an index.
financing costs with income from finance receivables. Foreign
currency and interest rate swap agreements used among
different currencies, also serve to hedge foreign currency
exchange risk as well as interest rate risk.

Finance Subsidiaries—Receivables
2008 2009
Yen (millions) Yen (millions)
Expected maturity date Average
interest
Total Fair value Total Within 1 year 1-2 year 2-3 year 3-4 year 4-5 year Thereafter Fair value rate
Direct financing leases*1
JP¥ ¥ 23,580 — ¥ 24,720 14,156 5,364 3,035 1,438 725 2 — 4.83%
US$ 657,278 — 199,172 179,717 19,115 339 1 — — — 6.00%
Other 531,776 — 475,409 136,583 144,600 110,581 71,899 11,729 17 — 3.92%
Total—Direct Financing Leases ¥1,212,634 — ¥ 699,301 330,456 169,079 113,955 73,338 12,454 19 —
Other Finance Receivables:

JP¥ ¥ 441,695 437,032 ¥ 450,177 150,408 114,770 83,856 51,594 31,828 17,721 445,588 4.83%
US$ 2,515,518 2,645,690 2,561,667 904,796 577,081 494,761 375,378 175,880 33,771 2,481,293 5.55%
Other 610,201 524,144 504,599 234,525 121,639 82,669 45,841 17,083 2,842 499,198 6.10%
Total—Other Finance Receivables ¥3,567,414 3,606,866 ¥3,516,443 1,289,729 813,490 661,286 472,813 224,791 54,334 3,426,079
Retained interest in securitizations*2 54,636 54,636 45,648 45,648
Total*3 ¥4,834,684 ¥4,261,392
*1 : Under U.S. generally accepted accounting principles, disclosure of fair values of direct financing leases is not required.
*2 : The retained interest in securitizations is accounted for as “trading” securities and is reported at fair value.
*3 : The finance subsidiaries—receivables include finance subsidiaries—receivables included in trade receivables and other assets in the consolidated balance sheets.
Long-Term Debt (including current portion)

2008 2009
Expected maturity date
Average
Total Fair value Total Within 1 year 1-2 year 2-3 year 3-4 year 4-5 year Thereafter Fair value interest
Japanese yen bonds ¥ 250,080 251,166 ¥ 260,000 60,000 60,000 70,000 30,000 40,000 — 290,411 1.18%
Japanese yen medium-term notes (Fixed rate) 321,600 324,504 220,263 74,645 77,425 33,650 25,113 6,452 2,978 213,717 1.18%
Japanese yen medium-term notes (Floating rate) 165,000 166,308 125,865 20,647 28,687 16,378 58,168 1,985 — 118,553 1.01%
U.S. dollar medium-term notes (Fixed rate) 274,346 286,869 390,098 73,511 50,968 34,305 — 143,101 88,213 359,107 5.57%
U.S. dollar medium-term notes (Floating rate) 1,005,456 1,010,974 796,545 632,125 65,915 98,505 — — — 780,050 1.45%
Loans and others—primarily fixed rate 691,220 701,228 1,117,389 116,595 320,430 181,361 219,545 274,580 4,878 1,023,938 3.92%
Total ¥2,707,702 2,741,049 ¥2,910,160 977,523 603,425 434,199 332,826 466,118 96,069 2,785,776
Interest Rate Swaps

2008 2009
Notional Expected maturity date Average Average

principal Contract Contract receive pay
currency Receive/Pay amounts Fair value amount Within 1 year 1-2 year 2-3 year 3-4 year 4-5 year Thereafter Fair value rate rate
JP¥ Float/Fix ¥ 2,330 (4) ¥ 510 110 400 — — — — (3) 1.02% 1.55%
US$ Float/Fix 2,885,355 (81,730) 2,866,860 1,226,632 938,069 562,758 119,804 19,597 — (88,322) 1.34% 3.95%
Fix/Float 403,333 13,135 599,600 146,528 112,343 58,373 1,418 192,531 88,407 36,867 5.35% 2.81%
Float/Float 67,127 (36) 24,558 24,558 — — — — — (76) 1.12% 1.56%
CA$ Float/Fix 658,179 (9,924) 570,945 206,140 166,961 104,088 70,434 22,847 475 (25,298) 0.85% 3.69%
Fix/Float 154,287 4,418 210,427 7,714 39,022 46,769 46,769 70,153 — 17,372 5.22% 2.03%
Float/Float 100,876 (325) 32,222 21,901 10,321 — — — — (143) 0.64% 1.00%
GBP Float/Fix 23,469 83 22,002 11,377 10,625 — — — — (691) 2.33% 5.00%
Total ¥4,294,956 (74,383) ¥4,327,124 1,644,960 1,277,741 771,988 238,425 305,128 88,882 (60,294)

Currency & Interest Rate Swaps
2008 2009
Receiving Paying Expected maturity date Average Average
side side Contract Contract receive pay
currency currency Receive/Pay amount Fair value amount Within 1 year 1-2 year 2-3 year 3-4 year 4-5 year Thereafter Fair value rate rate
JP¥ US$ Fix/Float ¥286,141 37,036 ¥190,565 65,428 67,478 28,140 20,748 6,010 2,761 29,896 1.18% 1.44%
Float/Float 153,023 19,641 163,797 18,257 24,508 69,185 50,027 1,820 — 12,220 1.22% 1.83%
JP¥ CA$ Fix/Float 2,685 (480) 2,137 2,137 — — — — — 42 0.95% 1.36%
Other Other Fix/Float 165,885 34,731 275,013 — 58,570 — 104,070 112,373 — 17,461 5.07% 2.07%
Float/Float 55,279 13,161 35,499 35,499 — — — — — 1,578 1.63% 1.35%
Total ¥663,013 104,089 ¥667,011 121,321 150,556 97,325 174,845 120,203 2,761 61,197
(Equity Price Risk) in certain of these lawsuits. We are also subject to potential
Honda is exposed to equity price risk as a result of its liability under other various lawsuits and claims including 71
holdings of marketable equity securities. Marketable equity purported class actions in the United States.
securities included in Honda’s investment portfolio are held for Honda records a contingent liability when it is probable that
purposes other than trading, and are reported at fair value, an obligation has been incurred and the amount of loss can be
with unrealized gains or losses, net of deferred taxes, included reasonably estimated. Honda reviews these pending lawsuits
in accumulated other comprehensive income (loss) in the and claims periodically and adjusts the amounts recorded for
stockholders’ equity section of the consolidated balance these contingent liabilities, if necessary, by considering the
sheets. At March 31, 2008 and 2009, the estimated fair value nature of lawsuits and claims, the progress of the case and the
of marketable equity securities was ¥120.0 billion and ¥54.8 opinions of legal counsel. Honda does not record liabilities for
billion, respectively. lawsuits or potential claims that it believes an unfavorable
outcome or when a reasonable estimate of the amount or
Legal Proceedings range of loss cannot be determined. After consultation with
Various legal proceedings are pending against us. We believe legal counsel, and taking into account all known factors
that such proceedings constitute ordinary routine litigation pertaining to existing lawsuits and claims, Honda believes that
incidental to our business. With respect to product liability, the ultimate outcome of such lawsuits and pending claims
personal injury claims or lawsuits, we believe that any judgment including 71 purported class actions in the United States
that may be recovered by any plaintiff for general and special should not result in liability to Honda that would be likely to
damages and court costs will be adequately covered by our have an adverse material effect on its consolidated financial
insurance and accrued liabilities. Punitive damages are claimed position, results of operations or cash flows.

Consolidated Balance Sheets
Honda Motor Co., Ltd. and Subsidiaries

March 31, 2008 and 2009 U.S. dollars
Yen
(millions) (millions)
Assets 2008 2009 2009
Current assets:
Cash and cash equivalents ¥ 1,050,902 ¥ 690,369 $ 7,028
Trade accounts and notes receivable, net of allowance
for doubtful accounts of ¥8,181 million in 2008 and
¥7,455 million ($76 million) in 2009 1,021,743 854,214 8,696
Finance subsidiaries—receivables, net 1,340,728 1,172,030 11,931
Inventories 1,199,260 1,243,961 12,664
Deferred income taxes 158,825 198,158 2,017
Other current assets 460,110 462,446 4,708
Total current assets 5,231,568 4,621,178 47,044
Finance subsidiaries—receivables, net 2,707,820 2,400,282 24,435
Investments and advances:

Investments in and advances to affiliates 549,812 505,835 5,149
Other, including marketable equity securities 222,110 133,234 1,357
Total investments and advances 771,922 639,069 6,506
Property on operating leases:

Vehicles 1,014,412 1,557,060 15,851
Less accumulated depriciation 95,440 269,261 2,741
Net property on operating leases 918,972 1,287,799 13,110
Property, plant and equipment, at cost:

Land 457,352 469,279 4,777
Buildings 1,396,934 1,446,090 14,721
Machinery and equipment 3,135,513 3,133,439 31,900
Construction in progress 227,479 159,567 1,624
5,217,278 5,208,375 53,022
Less accumulated depreciation and amortization 3,015,979 3,060,654 31,158
Net property, plant and equipment 2,201,299 2,147,721 21,864
Other assets 783,962 722,868 7,360

Total assets ¥12,615,543 ¥11,818,917 $120,319

Yen U.S. dollars
Liabilities, Minority Interests and Stockholders’ Equity 2008 2009 2009
Current liabilities:
Short-term debt ¥ 1,687,115 ¥ 1,706,819 $ 17,376
Current portion of long-term debt 871,050 977,523 9,951
Trade payables:
Notes 39,006 31,834 324
Accounts 1,015,130 674,498 6,867
Accrued expenses 730,615 562,673 5,728
Income taxes payable 71,354 32,614 332
Other current liabilities 258,066 251,407 2,559
Total current liabilities 4,672,336 4,237,368 43,137
Long-term debt, excluding current portion 1,836,652 1,932,637 19,675
Other liabilities 1,414,270 1,518,568 15,459

Total liabilities 7,923,258 7,688,573 78,271
Minority interests in consolidated subsidiaries 141,806 123,056 1,253
Stockholders’ equity:
Common stock, authorized 7,086,000,000 shares;
issued 1,834,828,430 shares 86,067 86,067 876
Capital surplus 172,529 172,529 1,756
Legal reserves 39,811 43,965 448
Retained earnings 5,106,197 5,099,267 51,912
Accumulated other comprehensive income (loss), net (782,198) (1,322,828) (13,467)
Treasury stock, at cost 20,290,531 shares in 2008 and
20,219,430 shares in 2009 (71,927) (71,712) (730)
Total stockholders’ equity 4,550,479 4,007,288 40,795
Commitments and contingent liabilities

Total liabilities, minority interests and stockholders’ equity ¥12,615,543 ¥11,818,917 $120,319

Consolidated Statements of Income

Years ended March 31, 2007, 2008 and 2009 U.S. dollars
Yen
2007 2008 2009 2009
Net sales and other operating revenue ¥11,087,140 ¥12,002,834 ¥10,011,241 $101,916
Operating costs and expenses:

Cost of sales 7,865,142 8,543,170 7,419,582 75,532
Selling, general and administrative 1,818,272 1,918,596 1,838,819 18,720
10,235,261 11,049,725 9,821,598 99,985
Other income:
Interest 42,364 50,144 41,235 420
Other 13,243 5,384 2,372 24
55,607 55,528 43,607 444
Other expenses:
Interest 12,912 16,623 22,543 229
Other 101,706 96,173 48,973 500
114,618 112,796 71,516 729
equity in income of affiliates 792,868 895,841 161,734 1,646
Income tax (benefit) expense:

Current 300,294 356,095 68,062 693
Deferred (16,448) 31,341 41,773 425
283,846 387,436 109,835 1,118
Income before minority interest and
equity in income of affiliates 509,022 508,405 51,899 528
Minority interest in income of consolidated subsidiaries (20,117) (27,308) (13,928) (141)

Equity in income of affiliates 103,417 118,942 99,034 1,008
Net income ¥ 592,322 ¥ 600,039 ¥ 137,005 $ 1,395
Yen U.S. dollars
2007 2008 2009 2009

Basic net income per common share ¥ 324.62 ¥ 330.54 ¥ 75.50 $ 0.77

Consolidated Statements of Stockholders’ Equity and Comprehensive Income

Years ended March 31, 2007, 2008 and 2009 Yen (millions)
Accumulated
other Total
Common Capital Legal Retained comprehensive Treasury stockholders’
stock surplus reserves earnings income (loss), net stock equity
Balance at March 31, 2006 ¥86,067 ¥172,529 ¥35,811 ¥4,267,886 ¥(407,187) ¥(29,356) ¥4,125,750
Cumulative effect of adjustments resulting from the
adoption of SAB No. 108, net of tax — — — (62,640) 18,149 — (44,491)
Adjustment resulting from change in fiscal year-end of a
subsidiary, net of tax — — — 6,214 — — 6,214
Adjusted balances at March 31, 2006 86,067 172,529 35,811 4,211,460 (389,038) (29,356) 4,087,473
Transfer to legal reserves 1,919 (1,919) —
Cash dividends (140,482) (140,482)
Comprehensive income (loss):
Net income 592,322 592,322
Other comprehensive income (loss), net of tax
Adjustments from foreign currency translation 96,775 96,775
Unrealized gains (losses) on marketable securities, net (4,571) (4,571)
Unrealized gains (losses) on derivative instruments, net 84 84
Minimum pension liabilities adjustment 8,908 8,908
Total comprehensive income 693,518
Adjustment for initially applying SFAS No. 158, net of tax (139,324) (139,324)
Purchase of treasury stock (30,974) (30,974)
Reissuance of treasury stock (277) 18,891 18,614
Adjusted balance at March 31, 2007 ¥86,067 ¥172,529 ¥37,730 ¥4,661,104 ¥(427,166) ¥(41,439) ¥4,488,825
Cash dividends (152,590) (152,590)
Net income 600,039 600,039
Adjustments from foreign currency translation (312,267) (312,267)
Unrealized gains (losses) on derivative instruments, net 440 440
Pension and other postretirement benefits
adjustments (16,746) (16,746)
Total comprehensive income 245,007
Purchase of treasury stock (34,404) (34,404)
Reissuance of treasury stock (275) 3,916 3,641

Consolidated Statements of Stockholders’ Equity and Comprehensive Income
Yen (millions)
Accumulated
other Total
Cash dividends (139,724) (139,724)
Net income 137,005 137,005
Unrealized gains (losses) on derivative instruments, net (460) (460)
Pension and other postretirement benefits adjustments (37,791) (37,791)
Total comprehensive income (403,625)
Purchase of treasury stock (62) (62)
Reissuance of treasury stock (57) 277 220
Balance at March 31, 2009 ¥86,067 ¥172,529 ¥43,965 ¥5,099,267 ¥(1,322,828) ¥(71,712) ¥4,007,288
U.S. dollars (millions)

Accumulated
other Total
Adjuted balance at March 31, 2008 $876 $1,756 $406 $51,982 $ (7,964) $(732) $46,324
Transfer to legal reserves 42 (42) —
Cash dividends (1,422) (1,422)
Net income 1,395 1,395
Unrealized gains (losses) on marketable securities, net (255) (255)
Unrealized gains (losses) on derivative instruments, net (4) (4)
Pension and other postretirement benefits adjustments (385) (385)
Total comprehensive income (4,108)
Purchase of treasury stock (1) (1)
Reissuance of treasury stock (1) 3 2
Balance at March 31, 2009 $876 $1,756 $448 $51,912 $(13,467) $(730) $40,795

Consolidated Statements of Cash Flows

Years ended March 31, 2007, 2008 and 2009 Yen U.S. dollars
2007 2008 2009 2009
Cash flows from operating activities:
Net income ¥ 592,322 ¥ 600,039 ¥ 137,005 $ 1,395
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation excluding property on operating leases 361,747 417,393 441,868 4,498
Depreciation of property on operating leases 9,741 101,032 195,776 1,993
Deferred income taxes (16,448) 31,341 41,773 425
Minority interest in income 20,117 27,308 13,928 141
Equity in income of affiliates (103,417) (118,942) (99,034) (1,008)
Dividends from affiliates 54,849 67,764 65,140 663
Provision for credit and lease residual losses on finance subsidiaries—receivables 44,128 58,011 77,016 784
Impairment loss on investments in securities 798 577 26,001 265
Impairment loss on long-lived assets and goodwill excluding property on operating leases — — 21,597 220
Impairment loss on property on operating leases 559 5,850 18,528 189
Loss (gain) on derivative instruments, net 56,836 70,251 (15,506) (158)
Decrease (increase) in assets:
Trade accounts and notes receivable (49,529) (67,696) (30,025) (306)
Inventories (96,839) (100,622) (262,782) (2,675)
Other current assets (15,206) (2,609) (82,838) (843)
Other assets (5,523) (130,666) 8,640 88
Increase (decrease) in liabilities:
Trade accounts and notes payable 38,186 32,327 (133,662) (1,361)
Accrued expenses 41,898 (24,768) (102,711) (1,046)
Income taxes payable (37,282) 20 (12,861) (131)
Other current liabilities 1,103 2,301 10,630 108
Other liabilities 14,274 179,537 74,872 762
Other, net (7,789) (21,530) (9,714) (97)
Net cash provided by operating activities 904,525 1,126,918 383,641 3,906
Cash flows from investing activities:
Increase in investments and advances (9,874) (6,417) (4,879) (50)
Decrease in investments and advances 3,829 1,270 1,921 20
Payments for purchases of available-for-sale securities (141,902) (158,426) (31,936) (325)
Proceeds from sales of available-for-sale securities 172,806 179,911 26,896 274
Payments for purchases of held-to-maturity securities (13,614) (39,482) (17,348) (177)
Proceeds from redemptions of held-to-maturity securities 41,109 32,557 32,667 333
Capital expenditures (597,958) (668,228) (635,190) (6,466)
Proceeds from sales of property, plant and equipment 20,641 26,868 18,843 192
Acquisitions of finance subsidiaries—receivables (2,857,024) (2,712,775) (2,303,930) (23,455)
Collections of finance subsidiaries—receivables 2,138,875 2,312,311 2,023,031 20,595
Proceeds from sales of finance subsidiaries—receivables 477,927 158,497 324,672 3,305
Purchases of operating lease assets (366,795) (839,261) (668,128) (6,802)
Proceeds from sales of operating lease assets 1,276 26,776 100,017 1,018
Net cash used in investing activities (1,130,704) (1,686,399) (1,133,364) (11,538)
Cash flows from financing activities:
Increase (decrease) in short-term debt, net 306,063 601,957 270,795 2,757
Proceeds from long-term debt 969,491 1,061,792 1,299,984 13,233
Repayments of long-term debt (677,539) (782,749) (889,483) (9,055)
Cash dividends paid (140,482) (152,590) (139,724) (1,422)
Cash dividends paid to minority interests (7,434) (9,663) (10,841) (110)
Sales (purchases) of treasury stock, net (26,689) (30,746) 131 1
Net cash provided by financing activities 423,410 688,001 530,862 5,404
Effect of exchange rate changes on cash and cash equivalents 31,527 (23,164) (141,672) (1,442)
Net change in cash and cash equivalents 228,758 105,356 (360,533) (3,670)
Cash and cash equivalents at beginning of year 716,788 945,546 1,050,902 10,698
Cash and cash equivalents at end of year ¥ 945,546 ¥1,050,902 ¥ 690,369 $ 7,028

Segment Information components of Honda’s about which separate financial
Honda has four reportable segments: the Motorcycle business, information is available that is evaluated regularly by
the Automobile business, the Financial services business and management in deciding how to allocate resources and in
the Power product and other businesses, which are based on assessing performance. The accounting policies used for these
Honda’s organizational structure and characteristics of reportable segments are consistent with the accounting
products and services. Operating segments are defined as policies used in Honda’s consolidated financial statements.
Principal products and services, and functions of each segment are as follows:
Segment Principal products and services Functions
Motorcycle business Motorcycles, all-terrain vehicles (ATVs), Research & Development
personal watercrafts and relevant parts Manufacturing
Sales and related services
Automobile business Automobiles and relevant parts Research & Development
Manufacturing
Financial services business Financial, insurance services Retail loan and lease related to Honda products
Others
Power product and Power products and relevant Research & Development
other businesses parts, and others Manufacturing
Others
Segment Information
As of and for the year ended March 31, 2007

Yen (millions)
Financial Power Product
Motorcycle Automobile Services and Other Segment Reconciling
Business Business Business Businesses Total Items Consolidated
Net sales and other operating revenue:
External customers ¥1,370,617 ¥ 8,889,080 ¥ 409,701 ¥417,742 ¥11,087,140 ¥ — ¥11,087,140
Intersegment — — 3,633 21,168 24,801 (24,801) —
Total 1,370,617 8,889,080 413,334 438,910 11,111,941 (24,801) 11,087,140
Cost of sales, SG&A and R&D expenses 1,270,009 8,289,537 297,792 402,724 10,260,062 (24,801) 10,235,261
Segment income 100,608 599,543 115,542 36,186 851,879 — 851,879
Equity in income of affiliates 23,380 78,537 — 1,500 103,417 — 103,417
Assets 1,161,707 5,437,709 5,694,204 338,671 12,632,291 (595,791) 12,036,500
Investments in affiliates 118,475 360,673 — 15,065 494,213 — 494,213
Depreciation and amortization 40,576 309,877 10,676 10,359 371,488 — 371,488
Capital expenditures 68,880 540,859 367,728 16,394 993,861 — 993,861
Impairment loss on long-lived assets and goodwill — — 559 — 559 — 559
Provision for credit and lease residual losses
on finance subsidiaries—receivables ¥ — ¥ — ¥ 44,128 ¥ — ¥ 44,128 ¥ — ¥ 44,128

Yen (millions)
External customers ¥ 1,558,696 ¥ 9,489,391 ¥ 533,553 ¥ 421,194 ¥12,002,834 ¥ — ¥12,002,834
Intersegment — — 15,499 21,571 37,070 (37,070) —
Total 1,558,696 9,489,391 549,052 442,765 12,039,904 (37,070) 12,002,834
Segment income 151,287 661,665 117,798 22,359 953,109 — 953,109
Assets 1,240,527 5,591,311 5,907,839 330,604 13,070,281 (454,738) 12,615,543
Capital expenditures 86,687 544,922 839,888 21,794 1,493,291 — 1,493,291
Impairment loss on long-lived assets and goodwill — — 5,850 — 5,850 — 5,850

Yen (millions)
External customers ¥1,411,511 ¥7,674,404 ¥ 582,261 ¥343,065 ¥10,011,241 ¥ — ¥10,011,241
Intersegment — — 14,264 25,840 40,104 (40,104) —
Total 1,411,511 7,674,404 596,525 368,905 10,051,345 (40,104) 10,011,241
Segment income (loss) 99,913 24,543 80,671 (15,484) 189,643 — 189,643
Assets 1,047,112 5,219,408 5,735,716 275,607 12,277,843 (458,926) 11,818,917
Capital expenditures 90,401 523,593 671,127 16,920 1,302,041 — 1,302,041
Impairment loss on long-lived assets and goodwill 413 18,874 18,528 2,310 40,125 — 40,125

External customers $14,369 $78,127 $ 5,928 $3,492 $101,916 $ — $101,916
Intersegment — — 145 263 408 (408) —
Total 14,369 78,127 6,073 3,755 102,324 (408) 101,916
Cost of sales, SG&A and R&D expenses 13,352 77,877 5,252 3,912 100,393 (408) 99,985
Segment income (loss) 1,017 250 821 (157) 1,931 — 1,931
Equity in income of affiliates 266 730 — 12 1,008 — 1,008
Assets 10,660 53,135 58,391 2,805 124,991 (4,672) 120,319
Investments in affiliates 1,094 3,859 — 165 5,118 — 5,118
Depreciation and amortization 521 3,800 2,029 141 6,491 — 6,491
Capital expenditures 920 5,330 6,832 173 13,255 — 13,255
Impairment loss on long-lived assets and goodwill 4 192 189 23 408 — 408
on finance subsidiaries—receivables $ — $ — $ 784 $ — $ 784 $ — $ 784
Explanatory notes:
1. Segment income (loss) is measured in a consistent manner with consolidated operating income, which is net income before other
income, other expenses, income tax (benefit) expense, minority interest in income, and equity in income of affiliates. Expenses not
directly associated with specific segments are allocated based on the most reasonable measures applicable.
2. Assets of each segment are defined as total assets, including derivative financial instruments, investments in affiliates, 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.
3. Intersegment sales and revenues are generally made at values that approximate arm’s-length prices.
4. Unallocated corporate assets, included in reconciling items, amounted to ¥377,873 million as of March 31, 2007, ¥385,442
million as of March 31, 2008, and ¥257,291 million ($2,619 million) as of March 31, 2009, which consist primarily of cash and
cash equivalents and marketable securities held by the Company. Reconciling items also include elimination of intersegment
transactions.
5. Depreciation and amortization of the Financial Services Business include ¥9,741 million for the year ended March 31, 2007,
¥101,032 million for the year ended March 31, 2008 and ¥195,776 million ($1,993 million) for the year ended March 31, 2009
related to depreciation of property on operating leases.
6. Capital expenditures of the Financial Services Business includes ¥366,795 million for the year ended March 31, 2007, ¥839,261
million for the year ended March 31, 2008 and ¥668,128 million ($6,802 million) for the year ended March 31, 2009 related to
purchases of operating lease assets.
External Sales and Other Operating Revenue by Product or Service Groups

Yen U.S. dollars
Years ended March 31: 2007 2008 2009 2009
Motorcycles and relevant parts ¥ 1,221,638 ¥ 1,418,028 ¥ 1,323,259 $ 13,471
All-terrain vehicles (ATVs), personal watercraft and relevant parts 148,979 140,668 88,252 898
Automobiles and relevant parts 8,889,080 9,489,391 7,674,404 78,127
Financial, insurance services 409,701 533,553 582,261 5,928
Power products and relevant parts 287,302 288,243 224,648 2,287
Others 130,440 132,951 118,417 1,205
Total ¥11,087,140 ¥12,002,834 ¥10,011,241 $101,916

Geographical Information
Yen (millions)
Japan United States Other Countries Total
Sales to external customers ¥2,061,720 ¥5,291,683 ¥3,733,737 ¥11,087,140
Long-lived assets 992,723 929,107 610,100 2,531,930

Yen (millions)
Long-lived assets 1,084,163 1,479,137 669,546 3,232,846

Yen (millions)
Long-lived assets 1,140,316 1,835,163 566,445 3,541,924

Sales to external customers $19,057 $40,626 $42,233 $101,916
Long-lived assets 11,609 18,682 5,766 36,057
The above information is based on the location of the Company and its subsidiaries.
Supplemental Geographical Information

In addition to the disclosure required by U.S. GAAP, Honda provides the following supplemental information as required by Financial
Instruments and Exchange Law:
(1) Overseas sales and revenues based on the location of the customer
Yen U.S dollars
Years ended March 31: 2007 2008 2009 2009
North America ¥5,980,876 ¥6,068,425 ¥ 4,514,190 $45,955
Europe 1,236,757 1,519,434 1,186,012 12,074
Asia 1,283,154 1,577,266 1,595,472 16,242
Other regions 905,163 1,251,932 1,269,026 12,919
Explanatory notes:
Major countries or regions in each geographic area:
North America United States, Canada, Mexico
Europe United Kingdom, Germany, France, Italy, Belgium
Asia Thailand, Indonesia, China, India
Other Regions Brazil, Australia

(2) Supplemental geographical information based on the location of the Company and its subsidiaries

Yen (millions)
North Other Reconciling
Japan America Europe Asia Regions Total Items Consolidated
Net sales and other

operating revenue:
External customers ¥2,061,720 ¥6,002,797 ¥1,228,564 ¥1,024,680 ¥769,379 ¥11,087,140 ¥ — ¥11,087,140
Transfers between
geographic areas 2,712,403 169,847 119,161 246,723 28,259 3,276,393 (3,276,393) —
Total 4,774,123 6,172,644 1,347,725 1,271,403 797,638 14,363,533 (3,276,393) 11,087,140
Cost of sales, SG&A and

R&D expenses 4,545,988 5,715,817 1,315,736 1,194,250 725,377 13,497,168 (3,261,907) 10,235,261
Operating income 228,135 456,827 31,989 77,153 72,261 866,365 (14,486) 851,879
Assets 2,985,123 6,834,409 948,922 935,963 414,147 12,118,564 (82,064) 12,036,500
Long-lived assets ¥ 992,723 ¥1,028,132 ¥ 198,232 ¥ 219,358 ¥ 93,485 ¥ 2,531,930 ¥ — ¥ 2,531,930

Yen (millions)
Net sales and other

operating revenue:
External customers ¥2,053,401 ¥6,091,512 ¥1,502,240 ¥1,307,117 ¥1,048,564 ¥12,002,834 ¥ — ¥12,002,834
Transfers between
Total 4,889,040 6,265,263 1,594,223 1,638,290 1,092,817 15,479,633 (3,476,799) 12,002,834

R&D expenses 4,696,482 5,832,635 1,542,676 1,507,566 976,335 14,555,694 (3,505,969) 11,049,725
Operating income 192,558 432,628 51,547 130,724 116,482 923,939 29,170 953,109
Assets 3,127,143 6,863,970 948,544 1,080,439 574,890 12,594,986 20,557 12,615,543
Long-lived assets ¥1,084,163 ¥1,589,356 ¥ 171,030 ¥ 260,141 ¥ 128,156 ¥ 3,232,846 ¥ — ¥ 3,232,846

Yen (millions)
Net sales and other

operating revenue:
External customers ¥1,871,962 ¥4,534,684 ¥1,191,540 ¥1,335,091 ¥1,077,964 ¥10,011,241 ¥ — ¥10,011,241
Transfers between
Total 4,162,587 4,779,124 1,278,902 1,608,231 1,144,220 12,973,064 (2,961,823) 10,011,241

R&D expenses 4,324,203 4,699,422 1,268,701 1,504,628 1,009,158 12,806,112 (2,984,514) 9,821,598
Operating income (loss) (161,616) 79,702 10,201 103,603 135,062 166,952 22,691 189,643
Assets 3,078,478 6,547,880 766,594 1,016,059 450,081 11,859,092 (40,175) 11,818,917
Long-lived assets ¥1,140,316 ¥1,918,579 ¥ 110,543 ¥ 253,113 ¥ 119,373 ¥ 3,541,924 ¥ — ¥ 3,541,924

U.S dollars (millions)
Net sales and other

operating revenue:
External customers $19,057 $46,164 $12,130 $13,591 $10,974 $101,916 $ — $101,916
Transfers between
geographic areas 23,319 2,488 889 2,781 675 30,152 (30,152) —
Total $42,376 $48,652 $13,019 $16,372 $11,649 $132,068 $(30,152) $101,916

R&D expenses 44,021 47,841 12,915 15,317 10,274 130,368 (30,383) 99,985
Operating income (loss) (1,645) 811 104 1,055 1,375 1,700 231 1,931
Assets 31,339 66,659 7,804 10,344 4,582 120,728 (409) 120,319
Long-lived assets $11,609 $19,531 $ 1,125 $ 2,577 $ 1,215 $ 36,057 $ — $ 36,057
Explanatory notes:
1. Major countries or regions in each geographic area:
North America United States, Canada, Mexico
Europe United Kingdom, Germany,
France, Italy, Belgium
Asia Thailand, Indonesia, China, India
Other Regions Brazil, Australia
2. Operating income (loss) of each geographical region is measured in a consistent manner with consolidated operating
income, which is net income before other income, other expenses, income tax (benefit) expense, minority interest in income,
and equity in income of affiliates.
3. Assets of each geographical region are defined as total assets, including derivative financial instruments, investments in
affiliates, and deferred tax assets.
4. Sales and revenues between geographic areas are generally made at values that approximate arm’s-length prices.
5. Unallocated corporate assets, included in reconciling items, amounted to ¥377,873 million as of March 31, 2007, ¥385,442
million as of March 31, 2008, and ¥257,291 million as of March 31, 2009, which consist primarily of cash and cash
equivalents and marketable securities held by the Company. Reconciling items also include elimination of transactions
between geographic areas.
Basis of Translating Financial Statements

The consolidated financial statements are expressed in Japanese yen. However, the consolidated financial statements as of and for
the year ended March 31, 2009 have been translated into United States dollars at the rate of ¥98.23 = U.S.$1, the approximate
exchange rate prevailing on the Tokyo Foreign Exchange Market on March 31, 2009. Those U.S. dollar amounts presented in the
consolidated financial statements and related notes are included solely for the reader. This translation should not be construed as a
representation that all the amounts shown could be converted into U.S. dollars.

Consolidated Balance Sheets Divided into Non-Financial Services
Businesses and Finance Subsidiaries
Yen (millions)
At March 31, 2008 and 2009 2008 2009
Assets
Non-financial services businesses
Current assets: ¥ 4,091,060 ¥ 3,512,567
Cash and cash equivalents 1,022,466 668,114
Trade accounts and notes receivable, net 552,442 436,467
Inventories 1,199,260 1,243,961
Other current assets 1,316,892 1,164,025
Investments and advances 1,023,113 876,976
Property, plant and equipment, net 2,183,220 2,128,368
Other assets 530,156 520,332
Total assets 7,827,549 7,038,243
Finance Subsidiaries
Cash and cash equivalents 28,436 22,255
Finance subsidiaries—short-term receivables, net 1,351,867 1,180,793
Finance subsidiaries—long-term receivables, net 2,708,367 2,401,469
Net property on operating leases 918,972 1,287,799
Other assets 900,197 843,400
Total assets 5,907,839 5,735,716
Reconciling items (1,119,845) (955,042)
Total assets ¥12,615,543 ¥11,818,917
Liabilities, Minority Interests and Stockholders’ Equity

Non-financial services businesses
Current liabilities: ¥ 2,301,125 ¥ 2,070,075
Short-term debt 324,507 656,951
Current portion of long-term debt 20,486 19,803
Trade payables 1,057,446 710,395
Accrued expenses 632,506 465,115
Other current liabilities 266,180 217,811
Long-term debt, excluding current portion 56,225 89,891
Other liabilities 1,121,208 1,114,411
Total liabilities 3,478,558 3,274,377
Finance Subsidiaries
Short-term debt 2,128,442 1,697,481
Current portion of long-term debt 863,797 961,302
Accrued expenses 148,276 142,151
Long-term debt, excluding current portion 1,786,744 1,857,018
Other liabilities 408,803 495,361
Reconciling items (891,362) (739,117)
Minority interests in consolidated subsidiaries 141,806 123,056
Common stock 86,067 86,067
Capital surplus 172,529 172,529
Legal reserves 39,811 43,965
Retained earnings 5,106,197 5,099,267
Accumulated other comprehensive income (loss), net (782,198) (1,322,828)
Treasury stock (71,927) (71,712)
Total stockholders’ equity 4,550,479 4,007,288
Total liabilities, minority interests and stockholders’ equity ¥12,615,543 ¥11,818,917

Consolidated Statements of Cash Flows Divided into Non-Financial
Services Businesses and Finance Subsidiaries
Yen (millions)
2008 2009
Non-financial Recon- Non-financial Recon-
services Finance ciling services Finance ciling
Years ended March 31, 2008 and 2009 businesses subsidiaries items Consolidated businesses subsidiaries items Consolidated
Cash flows from operating activities:
Net income ¥ 580,728 ¥ 19,323 ¥ (12) ¥ 600,039 ¥ 89,894 ¥ 47,111 ¥ — ¥ 137,005
Adjustments to reconcile net income to
net cash provided by operating activities:
Depreciation 416,438 101,987 — 518,425 438,320 199,324 — 637,644
Deferred income taxes 7,612 23,729 — 31,341 (12,547) 54,320 — 41,773
Minority interests in income 27,280 28 — 27,308 13,886 42 — 13,928
Equity in income of affiliates (118,942) — — (118,942) (99,034) — — (99,034)
Dividends from affiliates 67,764 — — 67,764 65,140 — — 65,140
Impairment loss on investments in securities 577 — — 577 26,001 — — 26,001
Impairment loss on long-lived assets and goodwill — 5,850 — 5,850 21,597 18,528 — 40,125
Loss (gain) on derivative instruments, net (14,020) 84,271 — 70,251 24,045 (39,551) — (15,506)
Decrease (increase) in trade accounts
and notes receivable (57,164) (9,996) (536) (67,696) (55,881) 25,995 (139) (30,025)
Decrease (increase) in inventories (100,622) — — (100,622) (262,782) — — (262,782)
Increase (decrease) in trade accounts
and notes payable 19,299 — 13,028 32,327 (132,909) — (753) (133,662)
Other, net 107,049 (4,508) (42,245) 60,296 (144,915) 95,425 12,524 (36,966)
Net cash provided by operating activities 935,999 220,684 (29,765) 1,126,918 (29,185) 401,194 11,632 383,641
Cash flows from investing activities:
Decrease (increase) in investments
and advances (87,073) — 96,486 9,413 75,714 — (68,393) 7,321
Capital expenditures (667,601) (627) — (668,228) (632,191) (2,999) — (635,190)
Proceeds from sales of property,
plant and equipment 26,476 392 — 26,868 18,501 342 — 18,843
Decrease (increase) in finance
subsidiaries—receivables — (227,525) (14,442) (241,967) — 45,509 (1,736) 43,773
Purchase of operating lease assets — (839,261) — (839,261) — (668,128) — (668,128)
Proceeds from sales of operating lease assets — 26,776 — 26,776 — 100,017 — 100,017
Net cash used in investing activities (728,198) (1,040,245) 82,044 (1,686,399) (537,976) (525,259) (70,129) (1,133,364)
Cash flows from financing activities:
Increase (decrease) in short-term debt, net 98,926 548,993 (45,962) 601,957 452,437 (243,690) 62,048 270,795
Proceeds from long-term debt 32,387 1,032,504 (3,099) 1,061,792 63,253 1,250,961 (14,230) 1,299,984
Repayment of long-term debt (24,918) (760,750) 2,919 (782,749) (23,165) (879,541) 13,223 (889,483)
Proceeds from issuance of common stock — 6,149 (6,149) — — 2,544 (2,544) —
Cash dividends paid (152,602) — 12 (152,590) (139,724) — — (139,724)
Cash dividends paid to minority interests (9,663) — — (9,663) (10,841) — — (10,841)
Payment for purchase of treasury stock, net (30,746) — — (30,746) 131 — — 131
Net cash provided by (used in)
financing activities (86,616) 826,896 (52,279) 688,001 342,091 130,274 58,497 530,862
Effect of exchange rate changes on cash
and cash equivalents (20,028) (3,136) — (23,164) (129,282) (12,390) — (141,672)
Net change in cash and cash equivalents 101,157 4,199 — 105,356 (354,352) (6,181) — (360,533)
Cash and cash equivalents at beginning of period 921,309 24,237 — 945,546 1,022,466 28,436 — 1,050,902
Cash and cash equivalents at end of period ¥1,022,466 ¥ 28,436 ¥ — ¥1,050,902 ¥ 668,114 ¥ 22,255 ¥ — ¥ 690,369
Notes:
1. Non-financial services businesses lend to finance subsidiaries. These cash flows are included in the decrease (increase) in investments and advances, increase (decrease) in
short-term debt, proceeds from long-term debt, and repayment of long-term debt. The amount of the loans to finance subsidiaries is a ¥90,337 million increase for the fiscal year
ended March 31, 2008, and a ¥70,937 million decrease for the fiscal year ended March 31, 2009, respectively.
2. Decrease (increase) in trade accounts and notes receivable for finance subsidiaries is due to the reclassification of finance subsidiaries—receivables which relate to sales of inventory
in the unaudited consolidated statements of cash flows presented above.

Financial Summary

Years ended or at March 31
1999 2000 2001 2002

Sales, income, and dividends
Net sales and other operating revenue ¥6,231,041 ¥6,098,840 ¥6,463,830 ¥7,362,438
equity in income of affiliates 523,168 419,658 388,419 555,854
Income taxes 229,624 170,434 178,439 231,150
Minority interest in income (2,657) (3,595) (3,443) (4,512)
Equity in income of affiliates 14,158 16,786 25,704 42,515
Net income 305,045 262,415 232,241 362,707
As percentage of sales 4.9% 4.3% 3.6% 4.9%
Cash dividends paid during the period 20,463 20,463 22,412 24,360
Interest expense 27,890 18,920 21,400 16,769
Assets, long-term debt, and stockholders’ equity

Total assets ¥5,073,660 ¥4,935,976 ¥5,719,020 ¥7,064,787
Long-term debt 673,084 574,566 368,173 716,614
Total stockholders’ equity 1,763,855 1,930,373 2,230,291 2,573,941
Capital expenditures (excluding purchase of operating lease assets) 237,080 222,891 285,687 303,424
Purchase of operating lease assets
Depreciation (excluding property on operating leases) 177,666 172,139 170,342 194,944
Depreciation of property on operating leases
Per common share

Net income:
Basic ¥ 156.52 ¥ 134.65 ¥ 119.17 ¥ 186.11
Diluted 156.52 134.65 119.17 186.11
Cash dividends paid during the period 10.5 10.5 11.5 12.5
Stockholders’ equity 905.10 990.53 1,144.43 1,320.77
Sales progress
Sales amounts:*
Japan ¥1,556,333 ¥1,612,191 ¥1,740,340 ¥1,868,746
25% 26% 27% 25%
Overseas 4,674,708 4,486,649 4,723,490 5,493,692
75% 74% 73% 75%
Total ¥6,231,041 ¥6,098,840 ¥6,463,830 ¥7,362,438
100% 100% 100% 100%
Unit sales:
Motorcycles 4,295 4,436 5,118 6,095
Automobiles 2,333 2,473 2,580 2,666
Power Products 3,412 4,057 3,884 3,926
Number of employees 112,200 112,400 114,300 120,600
Exchange rate (yen amounts per U.S. dollar)

Rates for the period-end ¥ 121 ¥ 106 ¥ 124 ¥ 133
Average rates for the period 128 112 111 125
*The geographic breakdown of sales amounts is based on the location of customers.
Yen U.S. dollars
2003 2004 2005 2006 2007 2008 2009 2009
¥7,971,499 ¥8,162,600 ¥8,650,105 ¥ 9,907,996 ¥11,087,140 ¥12,002,834 ¥10,011,241 $101,916

724,527 600,144 630,920 868,905 851,879 953,109 189,643 1,931
619,413 653,680 668,364 829,904 792,868 895,841 161,734 1,646

245,065 252,740 266,665 317,189 283,846 387,436 109,835 1,118
(9,658) (11,753) (11,559) (15,287) (20,117) (27,308) (13,928) (141)
61,972 75,151 96,057 99,605 103,417 118,942 99,034 1,008
426,662 464,338 486,197 597,033 592,322 600,039 137,005 1,395
5.4% 5.7% 5.6% 6.0% 5.3% 5.0% 1.4%
30,176 33,541 47,797 71,061 140,482 152,590 139,724 1,422
436,863 448,967 467,754 510,385 551,847 587,959 563,197 5,733
12,207 10,194 11,655 11,902 12,912 16,623 22,543 229
¥7,821,403 ¥8,380,549 ¥9,368,236 ¥10,631,400 ¥12,036,500 ¥12,615,543 ¥11,818,917 $120,319

1,140,182 1,394,612 1,559,500 1,879,000 1,905,743 1,836,652 1,932,637 19,675
2,629,720 2,874,400 3,289,294 4,125,750 4,488,825 4,550,479 4,007,288 40,795
316,991 287,741 373,980 457,841 627,066 654,030 633,913 6,453

366,795 839,261 668,128 6,802
220,874 213,445 225,752 262,225 361,747 417,393 441,868 4,498
9,741 101,032 195,776 1,993
Yen U.S. dollars
¥ 219.71 ¥ 243.45 ¥ 260.34 ¥ 324.33 ¥ 324.62 ¥ 330.54 ¥ 75.50 $ 0.77

219.71 243.45 260.34 324.33 324.62 330.54 75.50 0.77
15.5 17.5 25.5 38.5 77 84 77 0.78
1,367.34 1,527.45 1,778.24 2,259.26 2,463.69 2,507.79 2,208.35 22.48
Yen U.S. dollars

¥1,748,706 ¥1,628,493 ¥1,699,205 ¥ 1,694,044 ¥ 1,681,190 ¥ 1,585,777 ¥ 1,446,541 $ 14,726

22% 20% 20% 17% 15% 13% 14%
6,222,793 6,534,107 6,950,900 8,213,952 9,405,950 10,417,057 8,564,700 87,190
78% 80% 80% 83% 85% 87% 86%
¥7,971,499 ¥8,162,600 ¥8,650,105 ¥ 9,907,996 ¥11,087,140 ¥12,002,834 ¥10,011,241 $101,916
100% 100% 100% 100% 100% 100% 100%
Thousands
8,080 9,206 10,482 10,271 10,369 9,320 10,114

2,888 2,983 3,242 3,391 3,652 3,925 3,517
4,584 5,047 5,300 5,876 6,421 6,057 5,187
126,900 131,600 137,827 144,785 167,231 178,960 181,876
¥ 120 ¥ 106 ¥ 107 ¥ 117 ¥ 118 ¥ 100 ¥ 98

122 113 108 113 117 114 101

Selected Quarterly Financial Data
Yen (millions except per share amounts)

Year ended March 31, 2008 Year ended March 31, 2009
I II III IV I II III IV
Net sales and
other operating revenue ¥2,931,123 ¥2,971,346 ¥3,044,814 ¥3,055,551 ¥2,867,221 ¥2,826,865 ¥2,533,257 ¥1,783,898
Operating income (loss) 221,684 286,338 276,243 168,844 221,347 148,851 102,452 (283,007)
Income before
income taxes (loss) 218,258 269,992 260,745 146,846 235,095 149,462 86,750 (309,573)
Net income (loss) 166,117 208,483 200,009 25,430 179,611 123,316 20,242 (186,164)
Basic net income (loss) per
American depositary share ¥91.38 ¥114.94 ¥110.25 ¥14.01 ¥98.98 ¥67.96 ¥11.16 ¥(102.59)
Tokyo Stock Exchange:
(TSE) (in yen)
High ¥4,520 ¥4,600 ¥4,400 ¥3,660 ¥3,910 ¥3,850 ¥3,190 ¥2,515
Low 3,950 3,430 3,530 2,610 2,765 3,000 1,643 1,860
New York Stock Exchange:
(NYSE) (in U.S. dollars)
High $36.59 $37.80 $37.64 $33.61 $36.40 $35.67 $30.08 $25.58
Low 33.30 31.29 32.14 27.01 27.69 28.20 17.35 20.28
Note: All quarterly financial data is unaudited and has not been reviewed by the independent registered public accounting firm (KPMG AZSA & Co.).

Corporate Information
Principal Manufacturing Facilities 82

Honda Group 84
Honda’s History 86
Investor Information 88

Principal Manufacturing Facilities
Location
Start of Operations Number of Employees* Principal Products Manufactured
*As of March 31, 2009
Motorcycles Automobiles Engines
All-terrain vehicles Power products Transmissions
U.K. Swindon, Wiltshire

1992 3,744
France Ormes
1986 111
Italy Atessa
1976 822
India Greater Noida

1988 2,030
India Gurgaon China Chongqing

2001 2,669 2002 1,049
Turkey Gebze China Guangzhou

1997 1,295 2005 1,064
China Fuzhou
1995 394
Pakistan Lahore
1994 643
Taiwan Pingtung
2003 740
Thailand Ayutthaya
2000 3,550 Philippines Laguna
1992 690
Malaysia Pagoh
2003 1,451 Philippines Batangas
1983 865
Spain Barcelona
Indonesia Jakarta
1986 290
2003 1,343
Thailand Bangkok
1967 2,847
Vietnam Vinhphuc
1997 1,858

Japan Sayama, Saitama
1964 5,571
Japan Hamamatsu, Shizuoka

1954 2,917
Japan Ohzu-machi, Kikuchi-gun, Kumamoto

1976 3,251
Japan Yokkaichi, Mie

1985 2,327
Japan Suzuka, Mie

1960 6,943
U.S.A. Marysville, Ohio

1979 6,842
U.S.A. Anna, Ohio

1985 2,514
Canada Alliston, Ontario
1986 4,438
U.S.A. East Liberty, Ohio
1989 2,304
U.S.A. Russells Point, Ohio
U.S.A Greensburg, Indiana 1981 1,086
2008 1,137
U.S.A. Swepsonville, North Carolina
U.S.A. Lincoln, Alabama 1984 543
2001 4,468
U.S.A. Timmonsville, South Carolina
1998 680
Mexico El Salto U.S.A. Tallapoosa, Georgia

1988 2,047 2005 489
Peru Iquitos
2007 70
Brazil Manaus
1976 8,249
Brazil Sumare
1997 3,464
Argentina Buenos Aires

2006 310

Honda Group
Company Name Honda Motor Co., Ltd.
Established September 24, 1948
Lines of Business Motorcycles, Automobiles, Financial Services, and Power Products and Others
Head Office 1-1, 2-chome, Minami-Aoyama, Minato-ku, Tokyo, Japan
Principal Subsidiaries
Main Lines of Business
Percentage
Country of Ownership and Motorcycle Automobile Financial Services Power Product &
Region Incorporation Company Voting Interest Business Business Business Other Businesses Function
Japan Saitama Honda R&D Co., Ltd. 100.0 ○ ○ ○ Research & Development
Tochigi Honda Engineering Co., Ltd. 100.0 ○ ○ ○ Manufacturing and Sales of machine
tools, equipment and production
techniques
Saitama Yachiyo Industry Co., Ltd. 50.5 ○ ○ Manufacturing
Tokyo Honda Finance Co., Ltd. 100.0 ○ Finance
North U.S.A. American Honda Motor Co., Inc. 100.0 ○ ○ ○ Sales

America
Honda North America, Inc. 100.0 ○ ○ ○ ○ Coordination of Subsidiaries’ Operation
Honda of America Mfg., Inc. 100.0 ○ ○ Manufacturing
American Honda Finance Corporation 100.0 ○ Finance
Honda Manufacturing of Alabama, LLC 100.0 ○ Manufacturing
Honda Manufacturing of Indiana, LLC 100.0 ○ Manufacturing
Honda Transmission Mfg. of America, Inc. 100.0 ○ Manufacturing
Honda R&D Americas, Inc. 100.0 ○ ○ ○ Research & Development
Canada Honda Canada Inc. 100.0 ○ ○ ○ Manufacturing and Sales
Honda Canada Finance Inc. 100.0 ○ Finance
Mexico Honda de Mexico, S.A. de C.V. 100.0 ○ ○ ○ Manufacturing and Sales
Europe U.K. Honda Motor Europe Limited 100.0 ○ ○ ○ ○ Coordination of Subsidiaries’ Operation
and Sales
Honda of the U.K. Manufacturing Ltd. 100.0 ○ Manufacturing
Honda Finance Europe plc 100.0 ○ Finance
France Honda Motor Europe (South) S.A. 100.0 ○ ○ ○ Sales
Germany Honda Bank GmbH 100.0 ○ Finance
Honda Motor Europe (North) GmbH 100.0 ○ ○ ○ Sales
Italy Honda Italia Industriale S.p.A. 100.0 ○ ○ Manufacturing and Sales

Percentage
Asia China Honda Motor (China) Investment Corporation, Ltd. 100.0 ○ ○ ○ Coordination of Subsidiaries’ Operation
and Sales
Honda Automobile (China) Co., Ltd. 65.0 ○ Manufacturing
Honda Auto Parts Manufacturing Co., Ltd. 100.0 ○ Manufacturing
India Honda Siel Cars India Limited 97.4 ○ Manufacturing and Sales
Taiwan Honda Taiwan Co., Ltd. 100.0 ○ Sales
Thailand Asian Honda Motor Co., Ltd. 100.0 ○ ○ ○ ○ Coordination of Subsidiaries’ Operation
and Sales
Honda Leasing (Thailand) Company Limited 100.0 ○ Finance
Honda Automobile (Thailand) Co., Ltd. 89.0 ○ Manufacturing and Sales
Thai Honda Manufacturing Co., Ltd. 60.0 ○ ○ Manufacturing
Vietnam Honda Vietnam Co., Ltd. 70.0 ○ ○ Manufacturing and Sales
Others Argentina Honda Motor de Argentina S.A. 100.0 ○ ○ ○ Manufacturing and Sales
Brazil Honda South America Ltda. 100.0 ○ ○ ○ ○ Coordination of Subsidiaries’ Operation
Honda Automoveis do Brasil Ltda. 100.0 ○ Manufacturing and Sales
Moto Honda da Amazonia Ltda. 100.0 ○ ○ Manufacturing and Sales
Turkey Honda Turkiye A.S. 100.0 ○ ○ Manufacturing and Sales
Australia Honda Australia Pty. Ltd. 100.0 ○ Sales
Note: Percentage Ownership and Voting Interest include ownership through consolidated subsidiaries.
Major Affiliated Companies Accounted for under the Equity Method

Percentage
Japan Saitama Showa Corporation 33.5 ○ ○ ○ Manufacturing
Tokyo Keihin Corporation 42.2 ○ ○ ○ Manufacturing
Saitama TS Tech Co., Ltd. 22.7 ○ ○ Manufacturing
Shizuoka F.C.C. Co., Ltd. 20.7 ○ ○ ○ Manufacturing
Nagano Nissin Kogyo Co., Ltd. 34.7 ○ ○ Manufacturing
Saitama H-one Co., Ltd. 23.5 ○ ○ ○ Manufacturing
Aichi Musashi Seimitsu Industry Co., Ltd. 26.2 ○ ○ ○ Manufacturing
Saitama F-Tech Inc. 20.6 ○ Manufacturing
Asia China Guangqi Honda Automobile Co., Ltd. 50.0 ○ Manufacturing and Sales
Dongfeng Honda Automobile Co., Ltd. 50.0 ○ Manufacturing and Sales
Dongfeng Honda Engine Co., Ltd. 50.0 ○ Manufacturing
India Hero Honda Motors Ltd. 26.0 ○ Manufacturing and Sales
Indonesia P.T. Astra Honda Motor 50.0 ○ Manufacturing and Sales
Thailand A.P. Honda Co., Ltd. 49.0 ○ Sales
Note: Percentage Ownership and Voting Interest include ownership through consolidated subsidiaries.

Honda’s History
Major Products and

Year Noteworthy Events Technologies
1946 Soichiro Honda establishes Honda Technical Research Institute in Hamamatsu.

1947 Honda produces A-Type bicycle engine.
1948 Honda Motor Co., Ltd. incorporated (capital: 1 million yen, 34 associates) established.
1949 Production of Dream D-Type, Honda’s first production motorcycle, begins.
1950 Tokyo sales office established.
1952 Head office moved to Tokyo.
Motorcycle exports begin.
1953 H-Type engine, Honda’s first power product, produced. Dream D-type (1949)
Yamato Factory (now Wako Office) begins operation.
Honda Labor Union established.
1954 Honda declares participation in the Isle of Man T.T. Race.
Production moves from Hamamatsu Yamashita Plant to Hamamatsu Aoi Plant (now Hamamatsu Factory).
1955 Honda ranks first in motorcycle production in Japan.
1956 Honda Company Principle established.
1957 Listed on the Tokyo Stock Exchange.
1958 Super Cub motorcycle introduced.
1959 American Honda Motor Co., Inc. (Honda’s first overseas subsidiary) established.
Honda racing team takes 6th place in 125cc class in the first entry in Isle of Man T.T. Race. Team takes the Super Cub (1958)
Constructor’s Prize.
1960 Motorcycle production at Suzuka Factory begins. (Automobile production begins in 1967.)
R&D department spun off and incorporated as Honda R&D Co., Ltd.
1961 European Honda GmbH (now Honda Motor Europe (North) GmbH) (Honda’s first subsidiary in Europe) established
in Germany.
Honda racing team sweeps first five places in Isle of Man T.T. Race in both 125cc and 250cc categories.
1962 Construction of Suzuka Circuit completed.
1963 Honda’s first mini-truck (T360) and sports car (S500) introduced.
Honda Benelux N.V. (Belgium) begins motorcycle production. (Honda’s first overseas production facility. First
T360 (1963)
European (EEC) plant by Japanese manufacturers.)
1964 Honda announces and makes Formula 1 debut at German Grand Prix (places 9th).
Asian Honda Motor Co., Ltd. (Thailand) established.
Automobile production at Sayama plant (now Saitama Factory) begins.
1965 Export of automobiles (S600) begins.
1966 Honda wins Constructor’s Championship in all classes (50cc to 500cc) of motorcycle road race championship.
(First time in history.)
1967 Motorcycle production in Thailand begins.
1969 Automobile production in Taiwan begins (N600/TN600) (Honda’s first automobile production overseas).
Dream CB750 Four introduced. S500 (1963)
Automobile (N360) and motorcycle production in Malaysia begins.
1970 Honda Engineering Co., Ltd. established.
Moka Parts Plant (now Tochigi Factory) established.
Driving Safety Promotion Center inaugurated.
1971 Motorcycle production in Mexico begins.
Honda Automoveis do Brazil Ltda. established in Brazil.
1972 Civic introduced.
CVCC low emissions engine is introduced. (The first engine to comply with the 1970 U.S. Clean Air Act.)
1973 Civic CVCC introduced (export to the United States begins in 1975).
Motorcycle production in the Philippines begins. Dream CB750 Four (1969)
1974 Motorcycle production in Indonesia begins.
1975 GoldWing (GL1000) introduced in the United States.
Automobile production in Indonesia begins (TN trucks, Life, Civic).
1976 Accord introduced.
Kumamoto Factory begins operation.
Motorcycle production in Italy begins.
Motorcycle production in Brazil begins.
1977 Listed on the New York Stock Exchange (NYSE).
1979 Honda of America Mfg., Inc., in the United States, begins motorcycle production.
1981 Listed on the London Stock Exchange. Civic CVCC (1973)
Electro Gyrocator (the world’s first car navigation system) introduced.
1982 Honda of America Mfg., Inc., in the United States, begins Accord production. (A first for a Japanese auto maker.)
Motorcycle production in China begins. (Technical collaboration agreement with Jialing lndustry signed.)
Beijing office opens.
1984 Honda Research of America (now Honda R&D Americas, Inc.) established.
1985 Motorcycle production in India begins.
Yokkaichi Factory of Yachiyo Industry Co., Ltd. begins consignment for production of minicars.
Accord (1976)

Major Products and
Year Noteworthy Events Technologies
1986 American Honda’s Acura brand auto sales channel opens.

Automobile production at Honda Canada Inc. begins (Accord).
Motorcycle production in Spain begins.
Power product production in France begins.
1987 Legend becomes Japan’s first vehicle with SRS airbag system.
First Formula 1 race held at Suzuka Circuit.
1988 Export of U.S.-made Accord Coupe and GoldWing to Japan begins.
R&D facility established in Europe (now Honda R&D Europe). NSX (1990)
Power product production in India begins.
1989 Accord becomes the best-selling passenger car in the United States.
1990 Takanezawa Plant established.
NSX sports car introduced.
1992 Automobile production begins in the United Kingdom (Accord) and the Philippines.
Wuyang Honda, begins motorcycle production in China.
1994 Automobile production in Pakistan begins (Civic).
Odyssey introduced.
Power product production begins in China.
1995 CR-V sports utility vehicle introduced. Odyssey (1994)
Automobile production in Mexico begins (Accord).
1996 Humanoid robot prototype P2 introduced.
1997 Cumulative motorcycle production reaches 100 million units.
Automobile production begins in Brazil (Civic), Turkey (Civic), and India (City).
Motorcycle production in Vietnam begins.
Honda R&D Southeast Asia Co., Ltd. motorcycle research facility established in Thailand.
Twin Ring Motegi motorsports complex completed.
1998 Production and sales begin in the United States for the Civic GX, powered by compressed natural gas.
1999 Automobile production in China begins (Accord).
CR-V (1995)
Insight hybrid car introduced both in Japan and the United States.
2000 Humanoid robot ASIMO introduced.
Zero industrial landfill waste achieved at all production facilities in Japan.
2001 Cumulative automobile production in North America reaches 10 million units.
Fit introduced.
A motorcycle sales subsidiary in Korea established, and motorcycle sales begin.
2002 Honda FCX, first fuel-cell vehicle to receive U.S. government certification for commercial use, introduced in both
the United States and Japan.
Fit becomes the best-selling model in Japan.
2003 Global cumulative automobile production reaches 50 million units. Fit (2001)
The HondaJet prototype completes its maiden flight.
2004 Production of automobiles at Takanezawa Plant in Tochigi Factory shifted to Suzuka Factory.
Accord 2.2 i-CTD i, with Honda’s original diesel engine, introduced in Europe.
2005 Cumulative motorcycle production reaches 150 million units.
Cumulative Super Cub worldwide production reaches 50 million units.
Honda Automobile (China) Co., Ltd. begins exporting automobiles (Jazz, to Europe).
Automobile R&D established in Thailand.
2006 Three-channel automobile sales network in Japan integrated to the single Honda Cars channel.
Cumulative production of power products reaches 70 million units.
Developed world’s first motorcycle airbag system on GoldWing, for the U.S. market. GoldWing Airbag (2006)
Jointly developed ethanol production process from cellulosic biomass with RITE in Japan.
HondaJet operations begin; sales pre-orders are taken.
Automobile production in Vietnam begins (Civic).
Sales of Acura brand begin in China.
2007 Sales of next-generation thin-film solar cells begin in Japan.
Honda celebrates 25 years of automobile production in the United States.
2008 Cumulative motorcycle production of 200 million units achieved.
Kumamoto Factory completed.
Freed introduced.
HondaJet
50th anniversary of Super Cub sales launch.
New-model City introduced in India.
Yukios introduced.
FCX Clarity introduced through lease sales in Japan and United States.
Fit becomes the best-selling model in Japan.
2009 All-new Insight hybrid car introduced.
Pianta FV200 gas-powered tillers introduced.
Established joint-venture company Blue Energy Co. with GS Yuasa.
Insight (2009)

Investor Information
Company Information
Established September 24, 1948
Lines of Business Motorcycles, Automobiles, Financial Services, and Power Products and Others
Fiscal Year-end March 31

Independent Registered
Public Accounting Firm KPMG AZSA & Co.
Web Site • Corporate Web Site

http://www.honda.co.jp
• IR Web Sites
Japanese: http://www.honda.co.jp/investors/
English: http://world.honda.com/investors/
Stock Information
Securities Code 7267
Number of Shares Authorized 7,086,000,000 shares
Total Number of Shares Issued 1,834,828,430 shares
Number of Shareholders 219,216
Number of Shares per Trading Unit 100 shares
Stock Exchange Listings Japan: Tokyo, Osaka stock exchanges

Overseas: New York, London stock exchanges
General Meeting of Shareholders June
Record Dates for Dividends June 30

September 30
December 31
March 31
IR Offices
Japan Honda Motor Co., Ltd.

1-1, 2-chome, Minami-Aoyama, Minato-ku,
Tokyo 107-8556, Japan
TEL: 81-(0)3-3423-1111 (Switchboard)
U.S.A. American Honda Motor Co., Inc.

New York Office
156 West 56th Street, 20th Floor,
New York, NY 10019, U.S.A.
TEL: 1-212-707-9920

Shareholders’ Register Manager for Common Stock Depositary and Transfer Agent for American
Depositary Receipts
The Chuo Mitsui Trust and Banking Co., Ltd. JPMorgan Chase Bank, N.A.
33-1, Shiba 3-chome, Minato-ku, 4 New York Plaza,
Tokyo 105-8574, Japan New York, NY 10004, U.S.A.
Contact Address: Contact Address:
The Chuo Mitsui Trust and Banking Co., Ltd. JPMorgan Service Center
Stock Transfer Agency Dept. Operation Center P.O. Box 64504
8-4, Izumi 2-chome, Suginami-ku, St. Paul, MN 55164-0504, U.S.A.
Tokyo 168-0063, Japan TEL: 1-800-990-1135
TEL: 81-(0)3-3323-7111 E-mail: jpmorgan.adr@wellsfargo.com
TEL: 0120-78-2031 (toll free within Japan) Ratio: 1 ADR = 1 share of underlying stock
Ticker symbol: HMC
Note: With respect to taxation and other matters relating to the acquisition, holding, and disposition of
the Company’s common stock or ADRs by non-residents of Japan, please also refer to “Item 10E.
Taxation” of Form 20-F included in the “Investor Relations” section on our web site.
Major Shareholders
Number of shares held Percentage of total
Individual or Organization (thousands) shares outstanding (%)
Japan Trustee Services Bank, Ltd. (Trust Account 4G) 95,401 5.2
Japan Trustee Services Bank, Ltd. (Trust Account) 95,138 5.2
The Master Trust Bank of Japan, Ltd. (Trust Account) 85,350 4.7
Moxley & Co. 81,806 4.5
Tokio Marine & Nichido Fire Insurance Co., Ltd. 65,520 3.6
JPMorgan Chase Bank 380055 63,868 3.5
The Bank of Tokyo–Mitsubishi UFJ, Ltd. 61,144 3.3
Meiji Yasuda Life Insurance Company 54,043 3.0
Sompo Japan Insurance Inc. 43,666 2.4
Mitsui Sumitomo Insurance Co., Ltd. 35,039 1.9
Breakdown of Shareholders by Type
Treasury stock 1.1% Individuals 10.3%

Foreign institutions and individuals 32.9% Government and municipal corporations 0.0%
Domestic companies and others 10.0% Financial institutions 44.9%

Securities companies 0.8%
Honda’s Stock Price and Trading Volume on the Tokyo Stock Exchange
Yen Stock (millions)
5,000
Share prices prior to stock split have been adjusted to their effective post-adjustment values. Volume
4,000
← High
← Low
3,000
2,000
300
1,000 200
100
0 0
2003 2004 2005 2006 2007 2008 2009
(CY)
Note: The Company executed a two-for-one stock split for the Company’s common stock effective July 1, 2006. The prices of shares on the Tokyo Stock Exchange prior to
the split have been adjusted retroactively for consistency. Consequently, the prices shown here are not the actual prices of shares on the Tokyo Stock Exchange.

Annual Report 2009
This annual report is printed on recycled paper using soy ink with no volatile organic content.
Furthermore, a waterless printing process was used to prevent toxic emissions. Printed in Japan

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Annual Report 2009

Honda Motor Co., Ltd.

36 Preparing for the Future

Reports Published by Honda

Driving Safety Promotion Report

Caution with Respect to Forward-Looking Statements

Annual Report 2009 1

2 Annual Report 2009

Summary of Operating Results by Business

Percentage of Net Sales by Business

Power Product and Other Businesses

Financial Services Business

Annual Report 2009 3

600 200 582

Power Product and Other Businesses

Financial Services Business

Yen (billions) Yen (billions) (%) Yen (billions)

12,000 1,000 10.0 120

6,000 500 5.0 60

Yen (billions) (%) Yen (billions) （Yen） Yen (billions)

600 20.0 12,500 2,500 600

6 Annual Report 2009

Unit Sales Motorcycles Automobiles Power Products

Power Product and Other

6,000 2,000 4,000

2,000 10,000 600 500

Annual Report 2009 7

8 Annual Report 2009

Annual Report 2009 9

10 Annual Report 2009

Power Product and Other Businesses

Annual Report 2009 11

Initiatives Going Forward

Advancement of Advanced Environmental Technologies

12 Annual Report 2009

14 Annual Report 2009

Advancement of Honda’s Global Flexible Production System and Capabilities

Annual Report 2009 15

Returning Profit to Shareholders

16 Annual Report 2009

June 23, 2009

Motorcycle Business Thousands Years ended March 31

Net Sales Yen (millions) 2008 2009 4000 % change

Yen (billions) Years ended March 31

Annual Report 2009 19

VTR (Japan) CB223S (Japan)

FourTrax Rancher AT (North America) XL700V (Europe)

Annual Report 2009 21

CZ-i 110 (Thailand) CBF Stunner (India)

Activa (India) BeAT (Indonesia) CG150 TITAN MIX (Brazil)

Annual Report 2009 23

Automobile Business Thousands Years ended March 31

Net Sales 12,000 12000

0 Yen (billions) Years ended March 31 0 0

24 Annual Report 2009 8,000 500

Annual Report 2009 25

Accord (Japan) Odyssey (Japan)

TSX (North America) Fit (North America) TL (North America)

Annual Report 2009 27

Accord (Europe) Jazz (Europe)

28 Annual Report 2009

City (Asia) Fit FFV (Brazil)