Mitsubishi may cut almost 10,000 jobs

President of Japan's automaker Mitsubishi Motors Corporation Takashi Sonobe after announcing a series of model recalls this month.

TOKYO, Japan -- Almost 10,000 jobs at troubled Mitsubishi Motors Corp could be axed under a new plan to revive the world's 10th largest carmaker.

The cutbacks are said to be part of a medium-term business plan aimed at reviving Mitsubishi Motors (MMC), the Japan Industrial Journal reported on Wednesday.

Debt-laden MMC, which is 34 percent owned Germany's by DaimlerChrysler, is also planning to reduce the number of models it produces, and slash procurement costs by about 30 percent, the paper said.

MMC has forecast a net loss this financial year of $1.21 billion (¥140 billion) due to the cost of recalling more almost one million vehicles last year and of boosting its pension reserves.

The company is carrying out another recall this year, because some car models are beset by mechanical problems and faulty airbags. The recall covers 1.52 million vehicles across the U.S. and Europe.

Repair costs for the current recall are estimated at ¥17 billion.

New business plan unveiled

The Japan Industrial Journal says the new business plan would be unveiled on February 26 and would also include the closure of MMC's Ooe plant in Nagoya, central Japan.

If so, the announcement reverses a statement made by MMC in December, that it was not considering closing the Ooe facility.

But a company spokesman declined to comment on the report. "It's speculation by the newspaper. We cannot comment on our new business plan before an official announcement," the spokesman said.

Mitsubishi Motors has been struggling in the wake of last year's cover-up scandal to restore its image and its financial health with the help of DaimlerChrysler.

Shares in Mitsubishi Motors finished the Wednesday morning trade at 344 yen, up 1.47 percent.

Reuters contributed to this report.

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Mitsubishi.com
The Japan Industrial Journal

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