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Mitsubishi Motors preparing US plant closure, job cuts

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Japan's Mitsubishi Motors Corp has started preparing for the closure of its sole US factory after failing to find a buyer for the high-cost auto plant, the Nikkei business daily reported on Saturday.

[TOKYO] Japan's Mitsubishi Motors Corp has started preparing for the closure of its sole US factory after failing to find a buyer for the high-cost auto plant, the Nikkei business daily reported on Saturday.

The company will notify workers at the end of this month, the newspaper reported, without saying where it obtained the information. The 900 hourly workers at the Normal, Illinois plant are the only ones at a Japanese-owned U.S. auto factory to be represented by the United Auto Workers (UAW) union.

Mitsubishi Motors could not immediately be reached for comment.

The company announced plans in late July to end production at the plant, saying the decision was prompted by low volumes rather than high labour costs or a stronger dollar, which makes importing cars more profitable.

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A closure would mark a setback for the UAW, which is in the midst of negotiating higher wages with Detroit's Big Three automakers. Mitsubishi Motors opened the Normal plant in 1988 as a joint venture with then-partner Chrysler, and took sole control in 1991.

The Nikkei reported on Saturday that if a potential buyer emerges by November, Mitsubishi Motors would drop plans for the job cuts and negotiate a sale.

At its peak in the early 2000s, the Normal plant built more than 200,000 cars a year. Last year, production of the Outlander Sport utility vehicle totalled just 69,178, according to Mitsubishi Motors.

REUTERS

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