The North American segment of Mitsubishi Motor Corp. is increasingly losing money, a trend that is seen as a hurdle to the company’s financial recovery. And at this point, it appears that the losses will continue. In the quarter ended Dec. 31, 2010, North American sales increased by 15% to 23,000 units.
However, the regional operating loss expanded to 8.6 billion yen (or about $105.5 million) in the period, from 6.9 billion yen ($84.6 million) the previous year.
It’s estimated that for the full fiscal year that ends on March 31, 2011, the North American loss will widen to 30.0 billion yen ($367.9 million) compared to 28.2 billion yen ($345.8 million) the previous year.
These results, which were recently released in Mitsubishi’s quarterly earnings, highlight just how critical Mitsubishi’s actions are in overhauling its U.S. operations. Sales in the U.S. are now recovering after dropping to half their 2007 level above 100,000 units.
In 2010, Mitsubishi’s U.S. sales increased by 3% to 55,683 vehicles while the market had gone up 11%. Notably, January 2011 sales climbed by 37% to 5,714 vehicles. Compared to Mitsubishi’s overall sales, North America’s losses are disproportionately big.
In the first nine months of the fiscal year, the region sold only 66,000 units, making up only 8% of its global sales of 807,000 vehicles. This is actually the only region that didn’t record a sales increase for the company. It had been predicted that the biggest regional loss for the year would be in North America.