Mitsubishi Announces Reduction of 1,000 Jobs at U.S. Plant, Offices

Mitsubishi Motors Corp. plans to cut 1,000 jobs in its U.S. sales and manufacturing operations, including about 230 in Cypress, over the next two years in an effort to restore profitability.

The Japanese auto maker said it will eliminate about 700 jobs at its 4,200-employee manufacturing plant in Normal, Ill. The sales operation in Cypress employs about 1,100. Together, the job cuts amount to 19% of Mitsubishi’s U.S. work force.

The cuts announced Thursday, most of which the company hopes to achieve through attrition and transfers, will be completed by March 2001.

“We think most of it we can handle through attrition and impact people as little as possible,” spokesman Kim Custer said Thursday. He said it isn’t known how many people will actually be laid off in Cypress.

An announcement regarding the restructuring plans will be made today in Japan by Mitsubishi President Katsuhiko Kawasoe. The company also will release its half-year financial results, and is expected to announce the closing of two factories in Japan, according to Nikkei English News.

Last month, Mitsubishi eliminated about 70 jobs affiliated with the Cypress operation by consolidating its auto-loan finance department.

The ninth-largest auto maker in the U.S. began restructuring its U.S. operations in April after Takashi Sonobe became head of North American auto manufacturing and sales.

Mitsubishi, Japan’s fourth-largest auto maker, has suffered as a result of economic problems in Asia. In the United States, the company has been struggling for several years to post sales gains and increase market share.

Custer has said that U.S. operations made small profits last year and so far this year, and that its share of the U.S. car market has remained stable at 1.2%.

U.S. sales for the maker of the Galant sedan and Montero sport-utility vehicle rose 0.4%, to 164,351, for the first 10 months of this year.

Rivals Honda Motor Co. and Toyota Motor Corp. have posted strong profits on healthy sales in the U.S.

Mitsubishi also is examining partnerships with other auto makers, a source close to the Japanese firm told Reuters on Thursday. Industry analysts and media in Japan have speculated that could include closer ties with Chrysler Corp. and Sweden’s Volvo AB.

In May, the auto maker announced a three-year restructuring plan, including debt-reduction targets and cost cuts, but skeptical investors drove Mitsubishi’s stock price to record lows.

Last month, the auto maker said it would close its five regional U.S. offices by June 1999 and centralize its operations at its U.S. headquarters in Cypress.