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Business

Mitsubishi Motors to end US production

The plant stopped building multiple models as Mitsubishi Motors struggled in the U.S.

TOKYO -- Mitsubishi Motors will withdraw from automobile production in the U.S., taking a decisive step to focus on the growing Asian market.

     The Japanese company will cease production at an Illinois plant and will look for a buyer. The site opened in 1988 as a joint venture with Chrysler but is now a 100% subsidiary.

     Annual output there exceeded 200,000 units in 2002. But the facility has since stopped making sedans and other vehicles for North America. It now builds only the Outlander sport utility vehicle, sold as the RVR in Japan.

     The Illinois plant churned out just 64,000 units in 2014, far less than its annual capacity of 120,000 and accounting for less than 10% of Mitsubishi Motors' global production. Sluggish North American sales and the strong dollar have taken a toll on the operating rate.

     The company has less than 1% of the U.S. market, putting it way behind the likes of Toyota Motor.

     Mitsubishi Motors will be the first major Japanese automaker to end output in both the U.S. and Europe. It withdrew from Australian production in 2008 and sold off a facility in the Netherlands to a manufacturer there at the end of 2012.

     Meanwhile, the company has built a Thai plant for the Mirage strategic subcompact and is constructing new facilities in Indonesia. In the Philippines, it has bought a factory from Ford Motor of the U.S. The plan is to focus on Asia, where growth is expected, and to strengthen its global supply network there.

     The company will soon begin negotiations with labor, with plans to maintain employment for the Illinois workers.

(Nikkei)

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