TOKYO - Mitsubishi Motors Corp. plans, in part, to cut its debt at the expense of its European operations.
The carmaker will shift planned spending to North America, where it vows to develop vehicles more in tune with the market.
The details are part of a restructuring plan from April 2000 to March 2004. A previous restructuring plan covering the three years to March 2000 was swamped by a rise in the value of the yen against the dollar and the euro, as well as an extended slump in the domestic Japanese car and truck markets.
The foundation of the new plan, called 'Heart Beat 21,' is a focus on three key markets: Japan;
Asia and the Association of South East Asian Nations; and North America.
Notably absent from that list is Europe. Indeed, Mitsubishi President Katsuhiko Kawasoe said the carmaker will freeze investment in Europe at current levels in order to focus on North America.
That calls into question the future of NedCar, the joint venture in the Netherlands between Mitsubishi and Ford Motor Co.'s Volvo Car unit.
Ford has insisted that any new Volvos built at NedCar be built on a Ford platform, which would require additional investment to allow multiple platforms to be built on the same lines.
Mitsubishi aims to cut its debt to around 1 trillion yen, or about $9.5 billion at current exchange rates, by March 2004, from $16.7 billion at the end of September 1999. The previous target had been to cut debt to $14.3 billion by March 2001.
The company now aims for a group pretax profit of $190.5 million in the fiscal year ending March 31, 2001, and $1.4 billion in the fiscal year ending in March 2004.