Mon, May 24, 2004 - Page 10 News List

Japanese carmaker plans to double sales in China

BLOOMBERG

Mitsubishi Motors Corp, which depends on Asia for half its revenue, plans to more than double vehicle sales in China to 310,000 units in the next five years, as it bets on the market to help revive the company.

Tokyo-based Mitsubishi Motors, which plans to release 44 new and revamped models in the next four years, will introduce 11 models in China in the period, it said in a press release on Friday.

The automaker had released five new and revamped models in China over the past four years, selling 151,000 units in the country during the year ended March.

Mitsubishi Motors, which reported a loss of ?215.4 billion (US$1.9 billion) in the year ended March and projected an even bigger loss this year, will cut 22 percent of its jobs, close factories, and repay debt to earn an annual profit by March 2006.

It sees China as the key to growth after sales in the country rose 66 percent in the year just ended.

"It's a good strategy for Mitsubishi Motors to focus on Asia and make the best use of what it can now," said Yasuhiro Matsumoto, a credit analyst with BNP Paribas Securities in Tokyo.

The automaker said on Friday it plans to set up 500 dealerships in the year ending March 2009 from 110 in the year ending March 2005.

Mitsubishi Motors said it will also increase stakes in its Chinese joint ventures and make and sell vehicles using its brand.

The automaker expects sales of Mitsubishi-brand vehicles to increase to 213,000 units in the year ending March 2009 from 38,000 units in the year ending March 2005, the company said in a press release.

Mitsubishi Motors's shares rose 2.6 percent to 240 yen in Tokyo on Friday.

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