Struggling Mitsubishi Motors Corp. said Wednesday its global sales for fiscal 2004 will probably approach its 1.45 million-unit target because strong overseas sales are offsetting plunging domestic figures.

The better-than-expected figures were unveiled at an extraordinary shareholders’ meeting in Tokyo held in connection with MMC’s recent efforts to boost capital.

MMC said its overseas sales are expected to reach 1.2 million units, exceeding its target of 1.15 million announced in a turnaround plan in May.

Although the automaker has seen a huge decline in car sales in Japan and North America, strong demand in Asia, Europe and the Middle East has covered its losses.

MMC in June revised downward its domestic sales target for the current fiscal year to 220,000 units from about 300,000. Sales apparently have been declining due to the firm’s tainted image following revelations of a series of defect coverups.

MMC Managing Director Osamu Masuko said, “We are enjoying brisk sales of pickup trucks manufactured in Thailand.”

He said MMC’s Thailand plant has produced about 820,000 pickups, which have been exported to 140 nations.

But Yasuhiro Matsumoto, a credit analyst at BNP Paribas Securities (Japan) Ltd., remains pessimistic about sales on the domestic front.

“The company has seen its domestic sales decline about 50 percent year on year in recent months and it seems difficult to attain its 220,000-unit target,” he said.

The shareholders’ meeting was held to seek approval for a revision of MMC’s articles of incorporation over its recent capital buildup.

The revision was approved, enabling MMC to expand the total number of its outstanding shares so that preferred stocks, which have been issued to raise funds, can be converted into common stocks at any time.

MMC received 422 billion yen mainly from Mitsubishi group companies and JP Morgan for preferred shares that can be converted into common shares.

The increased common shares will lower the value of each share, hurting existing shareholders.

Shareholders voiced anger at the meeting, but Hiizu Ichikawa, MMC’s chief financial officer, asked for support.

“We needed at least 450 billion yen to turn around our business,” he said. “In order to raise such an enormous amount in a short period of time, we had no other choice.”

MMC received 496 billion yen in total, including 74 billion yen from fund Phoenix Capital Co. for common stocks.

“If we were unable to raise (that much), there would have been no future for MMC,” he said.

In a time of both misinformation and too much information, quality journalism is more crucial than ever.
By subscribing, you can help us get the story right.