Mitsubishi Returns to Profit

Announces Peugeot tie-up

Mitsubishi Motors announced a return to profit and a collaboration with Peugeot. Japan's fourth-biggest automaker Mitsubishi saw a return to the black and announced a tie-up with PSA Peugeot Citroen to launch a new sports utility vehicle in Europe, amid an ongoing wave of carmaker collaboration.

It booked a net profit of 30.5 billion yen in the quarter ended March, with consumer demand returning after being eroded by the financial crisis.

Cost-cutting and improving demand for new vehicles, particularly in Asia, enabled Mitsubishi to offset the impact of a stronger yen and book a net profit of 4.75 billion yen (US$50 million) in the fiscal year.

The result compares with a heavy loss of 54.88 billion yen a year ago, with demand being aided by "economic stimulatory measures introduced by national governments," the carmaker said. It warned, however, that "the realization of robust recovery is far off."

Its new partnership with PSA Peugeot Citroen will see the launch of a compact SUV in Europe in early 2012, based on the existing Mitsubishi RVR in Japan and its European counterpart, the ASX. The vehicle will be available in both four- and two-wheel drive, with 50,000 units per year expected to be produced.

Earlier this year the companies scrapped an ambitious capital tie-up that would have created the world's sixth-largest auto alliance, amid reports of financial discord.

But they agreed to cooperate to share resources and cut costs in a bid to close down on rivals, and plan to launch a car using Mitsubishi's electric i-MiEV system under the Peugeot brand in Europe this year.

The maker of the Pajero and Outlander sports utility vehicles recorded an operating profit of 13.9 billion yen and revenue of 1.4 trillion yen for the year.

While global sales for the year totaled 960,000 units, down 10% on the previous year, Mitsubishi said sales in China surged 64%.

Sales in North America declined 26% over the year to 88,000 units, while sales to Europe fell 38% to 169,000 vehicles.

The company has forecast net profit of 15 billion yen for the next fiscal year on revenue of 1.9 trillion yen, a year-on-year increase of 454.4 billion yen. It sees vehicle sales gaining 17% over the same period.

Copyright Agence France-Presse, 2010

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