Mitsubishi Motor Corp. says it will trim 1,000 jobs from its U.S. payroll, including 700 at its automobile factory in Normal, Ill.
Mitsubishi president Katsuhiko Kawasoe made the announcement Friday in Tokyo. The job cuts in Illinois are part of a worldwide restructuring that also includes the elimination of 300 jobs at a factory in California and 1,200 jobs at a plant in Thailand.
The announcement comes as Mitsubishi reported losses of $243 million in the first half of its fiscal year. The company had a $73 million profit in the same period a year ago.
Mitsubishi, one of Japan's biggest automaker, will cut 700 jobs at its Mitsubishi Motors Mfg. of America plant in Normal, Ill., which makes the Galant, Eclipse, and Eclipse Spider convertible models. The subsidiary now employs about 3,900 workers.
Three hundred jobs will be cut at Mitsubishi Motors Sales of America in California.
The company will also reduce the number of its car models by 40 percent and close two plants in Japan, Kawasoe told reporters.
Mitsubishi said it hopes to cut costs by $3 billion by 2001 and return to profitability after suffering huge losses from Japan's recession and the Asian financial crisis.
"The economic situation is very severe, but we have to do our utmost to return to profitability as soon as possible," Kawasoe said.
Mitsubishi said it had been hit hardest in Japan by a sharp fall in consumer demand for cars and stiffer competition among automakers. The economic turmoil in Asia also sharply cut into the profitability of its overseas operations, the company said.
Two fines paid to the government to settle discrimination cases have also dug into the company's bottom line.
In June, Mitsubishi agreed to pay $34 million to settle an Illinois sexual harassment case. Then in September, the company agreed to pay $3 million to settle the complaints of 87 people who said they weren't hired at the Normal factory because of their disabilities.