RSS   Newsletter   Contact   Advertise with us

Mitsubishi lost $1.4 billion, expects sales to fall 16%

Staff writer ▼ | June 22, 2016
Mitsubishi Motors said it sees fiscal year net loss of $1.4 billion or 145 billion Japanese Yen.
Mitsubishi Motors
Mitsubishi   A fraud in fuel consumption test
This is for the first time in the last eight years that the company reports a loss. Last year, it had recorded profit of 89.1 billion yen.

The Japanese motor giant expects net sales to fall by 16 percent to 1.91 trillion yen, with a decline of eight percent or 86 thousand units in total sales to 962 thousand units for fiscal 2016. In the previous year, net sales were 2.27 trillion.

On April 20, the company had revealed a fraud in fuel consumption test, and taking the responsibility, President Tetsuro Aikawa had resigned. Chairman Osamu Masuko replaced him temporarily.

The company had said it was using fuel-economy testing methods that were not in compliance with Japanese regulation. Mitsubishi expects fuel test impact of 205 billion yen in fiscal year of which, 150 billion yen is earmarked for one time fuel test charges.

Further, it has decided to pay 100 thousand yen or $960 each to car owners affected by fuel-cheat scandal. The individual compensation would come to 50 billion yen or $480 million.

Nissan Motor, which has agreed to own 34 percent stake in Mitsubishi, has been selling mini cars under the brand Dayz and Dayz Roox. Mitsubishi has offered 100 billion yen in compensation to Nissan.