Honda, Renault face waning demand after good quarter

　 A woman walks past Nissan Motor Co"s March cars at the company"s headquarters in Yokohama, south of Tokyo July 29, 2010.(REUTERS/Toru Hanai)
　

Honda Motor Co and Renault joined their rivals in reporting strong results for the quarter to the end of June, as the auto industry faces growing concerns over slowing demand in the United States, China and Europe.

　
　

"The biggest risk in the current business year is probably the overall slowing of the U.S. economy," said Tomomi Yamashita, a fund manager at Shinkin Asset Management in Tokyo.

　
　

Carmakers are also fearful that austerity measures in Europe including tax hikes in some markets will slow the recovery, leading Renault to stick to its goal for the year.

　
　

Honda raised its full-year forecasts on Friday after posting a record quarterly net profit on Friday, while Renault swung to first half profit but warned of an uncertain outlook in Europe.

　
　

Renault warned that pricing pressure would likely increase in the second half as the business environment remained uncertain, while raw material price rises would have a negative impact of up to 300 million euros in that period.

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