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Mitsubishi to stop making domestic luxury cars: Report
Tokyo, May 08: Japan`s ailing Mitsubishi Motors Corp (MMC) will withdraw from the domestic luxury car market by halting production of large-size passenger cars like the Diamante, a Japanese daily said on Saturday.
Tokyo, May 08: Japan's ailing Mitsubishi Motors Corp (MMC) will withdraw from the domestic luxury car market by halting production of large-size passenger cars like the Diamante, a Japanese daily said on Saturday.
Japan's fourth-largest auto maker, mired in huge losses and debt, is under pressure to come up with a restructuring plan after top shareholder DaimlerChrysler AG pulled out of a multi-billion dollar bail-out plan last month.
The Yomiuri Shimbun newspaper said the plan, under which Mitsubishi Motors will stop production of large-size luxury passenger cars -- those with engine displacement of 2500 cc or larger -- would be included in the restructuring drive.
The company would shift its focus to 2000 cc engines for the domestic market. The company will continue to produce larger models for overseas markets, including North America, but will unify their key parts with those of other models to cut costs, the report added.
Company officials were not available to comment. Initial expectations were that the company's bail-out costs would be around 250 billion yen ($2.3 billion), but media reports have said that it could cost as much as 400 billion to 500 billion yen ($3.6 to $4.6 billion)
Company officials have said details of the new business plan would be announced by the end of May.
Mitsubishi Motors has yet to recover from a recall scandal four years ago that exposed its decades-long practice of illegally hiding customer complaints, and it faces similar allegations over a design defect in trucks that were involved in accidents, including one that killed a woman two years ago.
Police arrested seven former Mitsubishi Motors executives on Thursday for mishandling the truck defect.
Bureau Report
Japan's fourth-largest auto maker, mired in huge losses and debt, is under pressure to come up with a restructuring plan after top shareholder DaimlerChrysler AG pulled out of a multi-billion dollar bail-out plan last month.
The Yomiuri Shimbun newspaper said the plan, under which Mitsubishi Motors will stop production of large-size luxury passenger cars -- those with engine displacement of 2500 cc or larger -- would be included in the restructuring drive.
The company would shift its focus to 2000 cc engines for the domestic market. The company will continue to produce larger models for overseas markets, including North America, but will unify their key parts with those of other models to cut costs, the report added.
Company officials were not available to comment. Initial expectations were that the company's bail-out costs would be around 250 billion yen ($2.3 billion), but media reports have said that it could cost as much as 400 billion to 500 billion yen ($3.6 to $4.6 billion)
Company officials have said details of the new business plan would be announced by the end of May.
Mitsubishi Motors has yet to recover from a recall scandal four years ago that exposed its decades-long practice of illegally hiding customer complaints, and it faces similar allegations over a design defect in trucks that were involved in accidents, including one that killed a woman two years ago.
Police arrested seven former Mitsubishi Motors executives on Thursday for mishandling the truck defect.
Bureau Report