Mitsubishi Motors North America said on Friday that it would begin production of a new SUV crossover at its plant in Normal, Illinois, next year, promising to keep the facility open less than a month after its 1,100 union employees agreed to wage concessions.
The state of Illinois said it would give the company US$29 million in tax incentives as it begins production of the new Outlander Sport.
The new vehicles, which Mitsubishi started making late last year, will replace four existing models now made at the Normal plant that will be phased out, Mitsubishi Motors North America president Shinichi Kurihara said on Friday at the plant.
Mitsubishi began producing vehicles there in 1988 through a joint venture with Chrysler. Chrysler stopped producing vehicles there several years ago and the fate of the plant has long been in question. The plant produced less than 50,000 vehicles last year, one-fourth of its capacity.
Mitsubishi said its US$45 million investment reinforces its commitment to the US market. Its sales rose 4 percent last year to 55,000 vehicles.
“Mitsubishi Motors remains fully committed to producing vehicles in Normal,” he said. “We will build vehicles here not just for the United States, but for many nations around the world.”
Mitsubishi has said the new model is part of its worldwide efforts to rejuvenate sales. It plans to produce the vehicle for North America as well as emerging markets such as Brazil and India.
The facility’s union workers recently agreed to cut their pay by US$1.67 an hour, a concession Mitsubishi said it needed to keep the plant open.