Honda Motor Co. has raised its full-year net profit outlook by six percent. The company expects its full-year net profit to be $3.95 billion or 415 billion yen, up from the previous forecast of $3 billion.

The Japanese automaker also boosted its global sales outlook. The main reason behind the raise is the solid performance of the company's products in Chinese market.

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During the first nine months of the year, Honda's sales in China grew by 26 percent year-over-year. The company sold 872,000 units during the said period. Honda saw a strong surge in its China sales of the Civic, which received a model change this year. Seiji Kuraishi, the executive vice president of Honda, said that the Civic is performing well in various markets including China, South America, and North America.

Honda also benefitted from the Chinese government's sales tax cut for vehicles fitted with smaller engines. The regulation helped Honda boost the sale of its Vezel and XR-V models in the country. It is likely that the Chinese government will extend the tax cut which is set to expire later this year.

However, Honda has trimmed its outlook for annual revenue. For the year ending in March 2017, the company expects its revenue to dip down to 13.4 trillion. The decline is mainly due to the yen gaining strength in the international market. This year, the Japanese currency is up 15 percent against the US dollar. Honda also said that adverse currency movements reduced its operating income by 178 billion yen during the first half of the current fiscal year. 

TagsHonda, honda civic, Honda Vezel