Fitch Rates Honda Auto Receivables 2005-2 Owner Trust 'F1+/AAA'

NEW YORK--April 26, 2005--Fitch assigns ratings to the receivables-backed class A notes issued today by Honda Auto Receivables 2005-2 Owner Trust as listed below:

-- $242,000,000 3.182% class A-1 asset-backed notes 'F1+';

-- $237,000,000 3.65% class A-2 asset-backed notes 'AAA';

-- $322,000,000 3.93% class A-3 asset-backed notes 'AAA';

-- $199,000,000 4.15% class A-4 asset-backed notes 'AAA'.

The trust also issued $33,687,395 in certificates that are retained by the seller and not rated. Fitch's ratings address the likelihood that the noteholders receive full payments of interest and principal in accordance with the terms of the transaction documents. The ratings on the class A notes are based on the high quality of the receivables originated and serviced by American Honda Finance Corporation (AHFC), the transaction's sound legal and cash flow structure, the yield supplement account (YSA), and the 3.75% initial credit enhancement provided by the subordinated certificates (3.25%) and the 0.50% nondeclining reserve account growing to a target level of 0.75% of the initial pool balance.

Principal and interest on the notes is distributed monthly, commencing May 1, 20056, 2005 with subsequent payment dates on the 15th of each month. Principal is distributed on a modified pro rata basis, with the class A-1 notes receiving all principal collections until paid in full. Once the class A-1 notes are retired, principal is distributed sequentially among the remaining class A notes but pro rata with the certificates. The certificate interest and principal payments are subordinated to the note interest and principal payments, as well as payments to the reserve account.

The receivables consist of a pool of retail installment sales contracts originated by AHFC through its nationwide network of authorized Honda and Acura dealers. As of the cutoff date, the receivables included 65,612 automobile loans with a total principal balance of $1.03 billion. The 2005-2 transaction contains 85.73% new vehicles. Although an elevated concentration, it is relatively lower than that of prior Honda securitizations. The weighted average (WA) original term was 58.31 months, slightly lower than previous securitizations. The WA remaining term was 51.13 months, which resulted in a seasoning of 7.18 months. The WA APR on the pool declined to 4.64% from 5.02% in 2005-1 as a result of increased incentive loans in the pool. The credit tier distribution for 2005-2, as captured by Honda's proprietary credit scores, is weaker than that of 2005-1 as a result of its larger concentration in lower credit tiers and is more comparable to 2004-3. Lower credit tiers typically charge off at a higher frequency than the top tiers.

As in prior transactions, California is the most represented state in the pool of receivables, with 20.52%, the highest percentage so far. Texas (8.52%), New York (5.34%), and Florida (5.17%) are the next most represented states. No other state accounts for more than 5.04% of the pool. Geographic diversification protects the transaction in the event of a regional downturn.

Business and credit stress scenarios were applied to the collateral to ensure that the structure is sufficient to withstand 'AAA' scenarios. Under the existing structure, 2005-2 is able to sustain more than 5.0% net losses without incurring shortfall of principal or interest on the class A notes.

HMC, AHMC's parent company, is Japan's third largest car manufacturer, a leading maker of motorcycles, motor vehicles, and power equipment, and ranks among the world's top 10 manufacturers. Additionally, HMC enjoys an extremely competitive global position based on its capital and manufacturing efficiency and reputation for producing high quality products.