Mitsubishi Motors to Move U.S. Production to Japan

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Mitsubishi Motors Corp. will stop making vehicles in the U.S. this year and close down its plant in Illinois if no buyers are found.

The Japanese automaker will cease producing its only model, the Outlander Sport, at the Bloomington-Normal plant at the end of November, it said in a statement today. The SUV will be exported from Okazaki in Japan to North America from the next model year. A final board decision is pending July 30.

Mitsubishi Motors’ move follows that of Suzuki Motor Corp., which exited the U.S. car market in 2012 after three decades. While U.S. auto demand is recovering, smaller Japanese car companies are finding it difficult to get enough orders to run their plants economically. A weaker yen also makes producing in Japan for export more viable, though Mitsubishi President Tetsuro Aikawa said foreign-exchange rates had no bearing on the decision.

Production at the U.S. plant, opened in 1988 as a joint venture with then Chrysler Corp., fell to as low as 18,500 units a year in 2009 from a peak of 222,000 units in 2000 due to the economic crisis and the end of supplying Chrysler. A slump in Russian demand since last year also dented output at the Illinois factory, which produced vehicles for export.

Aikawa said that the closure of the plant won’t have a big impact on its mid-term U.S. sales target. If no buyers are found, the company will take appropriate measures to settle the employees’ retirements, he said. Mitsubishi Motors will focus its production in Southeast Asia, Japan and Russia, he said.

Mitsubishi Motors rose for the first time in four days, trading 4.5 percent higher at 1,090 yen as of 1:58 p.m. in Tokyo trading. The benchmark Topix index fell 1.3 percent.

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