Fed: Mitsubishi could close unprofitable Adelaide plant

AAP General News (Australia)
04-27-2000
Fed: Mitsubishi could close unprofitable Adelaide plant

CANBERRA, April 27 AAP - Mitsubishi Australia may close within a year if it failed
to turn a profit or at least break even, its Japanese parent company has warned.

Mitsubishi Motors Corp president Katsuhiko Kawasoe said in Tokyo that there was a condition
for Mitsubishi to continue its Australian operations.

"It has to become break-even or profitable (before next year)," he told reporters.

"I hope the plants can restructure properly, the business will be profitable and it
will not be closed.

"That depends on the content of the restructure plan which will be disclosed within days."

When asked if there was a possibility of closing the company's production facilities
in Adelaide, Mr Kawasoe said: "To be honest, there is."

"The Australian operations don't even touch the break-even point, and in order to continue
the businesses, we have to see them even or plus."

His comments came as Mitsubishi in Japan unveiled a mid-term business plan that includes
further cost-cutting.

ABC Radio said the tough action needed was expected to be revealed at a mass meeting
later today of the 4,000 Adelaide workers.

The troubled Adelaide operations - an engine manufacturing plant and a vehicle assembly
plant - have undergone a rollercoaster ride of fortunes this year.

In January, Adelaide won the right to upgrade the Magna sedan and build the model that
would succeed the Magna, which should have guaranteed its future to at least 2012.

But last month German-American giant carmaker DaimlerChrsyler acquired a controlling
interest in Mitsubishi Motors, so there were no guarantees the new model would be built
in Adelaide.

Mitsubishi Australia, one of four Australian car makers, saw its sales fall 17 per
cent in 1999, to about 70,000 vehicles.

It retrenched 300 workers last year and warned more job losses could follow.

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