Mitsubishi Motors' Q1 profit surges as domestic sales recover

[TOKYO] Mitsubishi Motors Corp on Tuesday posted a four-fold jump in its operating profit for the first quarter, as the Japanese automaker clawed back from a slump in domestic sales a year ago when it admitted to a mileage-cheating scandal.

Operating profit at Japan's No 7 automaker came in at 20.6 billion yen (S$252.76 million) for the April-June quarter, higher than an average estimate of 15.10 billion yen from analysts polled by Thomson Reuters.

This compares to 4.6 billion yen a year ago, when sales were hit after it was found the automaker had overstated the fuel economy on some of its Japanese models.

Later in 2016, Nissan Motor Co took a controlling stake in Mitsubishi Motors, pledging to help in the embattled company's turnaround.

Mitsubishi Motors' first-quarter domestic sales almost doubled from a year ago to 19,000 vehicles.

It maintained its forecast to post a net profit of 68.0 billion yen in the current year ending March 2018, versus a net loss of 198.5 billion yen last year.

It has reorganised the engineering division involved in the mileage manipulation scandal and has improved testing processes and compliance procedures to prevent another incident.

This year, it anticipates better sales and cost savings from its alliance with Nissan to boost operating profit to 70 billion yen, from 5.1 billion yen last year.

REUTERS