Markets News

UPDATE 1-Mitsubishi Motors reports Q2 loss due to coronavirus slump

(Adds CEO comment)

TOKYO, Nov 4 (Reuters) - Mitsubishi Motors Corp on Wednesday reported a 29.3 billion yen ($279.10 million) operating loss in the three months ended Sept. 30 compared with a 6.3 billion yen profit a year earlier as sales shrank during the coronavirus pandemic.

The maker of the Outlander SUV is cutting its workforce and production capacity, and is closing unprofitable dealerships in a bid to slash fixed costs by a fifth within two years.

“Our restructuring plan is progressing faster than we anticipated. We have cut costs faster than we initially planned,” Takao Kato, Mitsubishi Motors’ CEO, said in a telephone press briefing after the company released its results.

Japan’s sixth-largest automaker kept its full-year forecast for an operating loss of 140 billion yen. That is more than an average estimate for a 115.2 billion yen loss compiled from 15 analysts polled by Refinitiv.

The company cut its sales target for the business year by 21,000 vehicles to 824,000 units.

In a bid to lift annual operating profit to 50 billion yen by 2023 the junior member of the Nissan-Renault automaking group, is also reducing its presence in Europe and North America and will be focusing on Asia.

As part of that it will halt production of its Pajero SUV crossover model next year, and close the plant in Japan that makes it.

Kato said his company had a good chance of returning to profit in the next business year. ($1 = 104.9800 yen) (Reporting by Tim Kelly; Editing by Jacqueline Wong)