Mitsubishi Motors Corp. announced Monday it has cut its losses for the first fiscal half to Sept. 30 compared with the previous year, thanks mainly to a weaker yen and cost-cutting efforts.
The automaker logged an operating loss of 5.5 billion yen from April to September, against a 19.8 billion yen loss for the same period last year.
Net loss came to 16.1 billion yen, an improvement from the 63.8 billion yen loss posted a year ago, with sales rising 1.4 percent, year-on-year, to about 1 trillion yen.
“This is an important year for us to return to the black for the full fiscal year, the target set forth in the rehabilitation plan,” MMC Chief Financial Officer Hiizu Ichikawa said at a news conference in Tokyo.
MMC kept its earnings forecast unchanged due to an uncertain business environment.
For the current year to March 31, the automaker expects a net profit of 8 billion yen, the target it set in the turnaround plan announced in January 2005, and an operating profit of 43 billion yen on 2.23 trillion yen in sales.
Although MMC’s worldwide car sales declined by about 10 percent, year-on-year, to 599,000 vehicles, the yen’s weakness against the dollar and the euro, combined with lower costs, offset the drop in sales volume.
The yen’s depreciation added 5.8 billion yen to MMC’s operating profit in the first fiscal half.
While car sales in Japan, North America and Europe rose during the period, elsewhere in Asia, especially in Indonesia and Taiwan, sales declined sharply, which led to the drop in overall sales volume.
MMC sold 114,000 cars in the domestic market, up 6 percent from the previous year. Sales in Japan grew for the 17th straight month since May 2005, the automaker said.
MMC saw its domestic sales nosedive after a series of defects and a scandal over efforts to cover them up came to light in March 2004.
Sales in North America rose 3.7 percent to 84,000 vehicles while sales in Europe rose 8.3 percent to 142,000 vehicles.
In Asia and other regions, sales slid by about 24 percent to 259,000 vehicles due to rising fuel prices and sluggish demand.
Auto output up again
Bloomberg Domestic auto production rose for the 11th straight month after Toyota Motor Corp. and Honda Motor Co. built more vehicles for overseas markets.
Domestic production jumped 2.8 percent to 1 million units in September from 974,104 the same month in 2005, the Japan Automobile Manufacturers Association said Monday. Exports rose 16 percent to 531,773 units.
Toyota and Honda, the nation’s largest and third-largest automakers, are building more vehicles to meet demand for fuel-efficient small cars in the United States, their most profitable market. The companies are taking customers from GM and Ford.
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