Primarily due to losses incurred in its North American operations due to customer defaults on credit sales and lagging domestic sales, Mitsubishi Motors Corporation (Japan) has temporarily shelved its new product developments scheduled for launching in 2006 onwards. Accordingly, they have drawn up a 6.5-billion US dollar bailout scheme to revitalize MMC with new products.
The "Revitalization Plan" called for additional capital infusion from DaimlerChrysler and the Mitsubishi Group. On April 23, the DC supervisory board rejected further capital infusion into Mitsubishi group citing the losses it has already incurred. But stated that it will not be selling its 37% stake in the cash strapped Japanese carmaker and expressed no intent of looking for someone to buy its stake as well. DC also stressed that all existing alliance passenger car projects continue as planned and DaimlerChrysler CFO Manfred Getz also issued a supporting statement: "I would not exclude that additional projects may come up, which we can follow in the future."
The decision of DaimlerChrysler leaves the Mitsubishi Group on its own to provide the new funding. The Mitsubishi Group with its main subsidiaries (Mitsubishi Heavy Industries, Mitsubishi Corporation and The Bank of Tokyo-Mitsubishi) have announced that it is committed to bringing Mitsubishi Motors back on its feet and will be developing a new Revitalization Plan by May.
With this development, Mr. Yoichiro Okazaki, currently Director at Mitsubishi Heavy Industries and nominated to be elected Board Member and Chairman on April 30, has been tasked to head up a business revitalization team within MMC, which will finalize the plan within one month.
Mr. Kengo Takase of Mitsubishi Motors Philippines Corporation meanwhile assured that MMPC will continue its operations based on its current product lineup and the launch of products in 2004 to 2006 which are already current in the MMC lineup but will be new to the Philippine market. These models include the Grandis and the Montero Sport. More importantly, Mr. Takase also revealed that a new small SUV soon to be manufactured by MMPC in 2006 for the Philippine market and to be exported to other ASEAN countries is already will go as planned and will not be affected by the "Revitalization Plan.'