Japan Carmakers Profits Allow A Hike in Salaries

, Reflecting Strong Pfts Wednesday 4:59 am ET

TOKYO March 17, 2004; Yoshio Takahashi writing for Dow Jones reported that Honda Motor Co. plans to pay record bonuses to staff this year, while Toyota Motor Corp. and Nissan Motor Co. also intend to raise wages as Japanese carmakers pass some of their booming earnings on to their workers.

The three automakers Wednesday agreed with their unions on wages for 2004 in annual spring salary talks.

Robust earnings at the carmakers due to strong sales in North America enabled them to match most of the unions' wage hike requests.

Honda said its bonuses will be equivalent to a record 6.55 months' pay, more than 6.4 months last year. Honda's union had requested a bonus of 6.6 months and didn't request a hike in monthly salaries.

Nissan said it has agreed to raise monthly salaries for the fifth consecutive year with a hike of Y7,000 a month. The carmaker will also pay annual bonuses equivalent to six months' wages, as the union had requested.

Toyota said it will raise monthly pay by Y6,500, as its union had requested.

The world's No.2 carmaker in terms of sales volume also accepted its union's bonus demand of 5.0 months' wage plus Y530,000. However, that's Y20,000 less than a year ago.

Honda is expecting a record net profit of Y473 billion for the current fiscal year ending March 31. Toyota is also anticipating record earnings, but it hasn't released a forecast.

Nissan, an affiliate of Renault SA , is forecasting group net profit will remain unchanged even after a boost last fiscal year from a one-time gain due to the sale of a major production site.

Yoshihide Munekuni, Chairman of the Japan Automobile Manufacturers Association, said the spring wage talks reflect the business environment surrounding each company and the auto industry as a whole.