Scandal-laden Mitsubishi Motors Corp. said Wednesday its group net loss expanded to 54.7 billion yen in the April-June quarter from a loss of 51.1 billion yen a year earlier.

The automaker attributed the weaker performance to a sales plunge and extraordinary losses from a halt in developing new models and a cutback of its Australian operations.

Sales fell 8.1 percent from a year earlier to 557.6 billion yen in the quarter due to plunging auto sales in Japan and North America.

The operating loss came to 31.7 billion yen in the quarter, improving from a 42.3 billion yen loss a year earlier, when the loss also included 24.1 billion yen from auto-loan defaults in North America.

In terms of sales volume, MMC’s global car sales, including minivehicles, during the reporting quarter fell 11.5 percent to 338,000 units.

Domestic sales showed the biggest decline, falling 38 percent to 49,000 vehicles.

MMC has been hit hard by defect-coverup scandals involving MMC and Mitsubishi Fuso Truck & Bus Corp., the truck unit MMC spun off in January 2003.

Customers have turned away since the defect coverups surfaced in March and domestic sales declined more than 50 percent for the third straight month through July.

In North America, MMC sold 53,000 vehicles, down 30.3 percent from the previous year, mainly due to a cutback in the auto financing scheme. MMC had loosened its loan scrutiny to boost sales in the U.S. in fiscal 2002, but defaults increased as a result, causing a huge loss.

In Europe, the automaker’s sales rose 9.4 percent to 58,000 units thanks to thriving sales of the new Colt compact. MMC also saw a rise in sales in Asia and other regions, increasing 2.3 percent to 178,000 units led by strong demand in China, Thailand and Latin America.

Despite the decline in profits, MMC maintained that it will try its best to achieve its goal of coming back to the black in fiscal 2006 under a revival plan announced in late May.

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