TOKYO -- Barely a year after declaring itself "back on track," Mitsubishi Motors Corp. appears to be back at square one amid reports of bigger losses, more restructuring and the dismissal of its German chief executive.
Leading Japanese business daily Nihon Keizai Shimbun reported Tuesday that Japan's fourth-largest automaker was set to close one of its three domestic plants within three years and could sell its joint ventures in Malaysia and the Philippines, among others, to raise funds and cut costs.
The paper also said 37 percent-owner DaimlerChrysler AG would send a new president as early as April to replace Rolf Eckrodt, who had been enlisted 20 months ago to steer a debt-laden, scandal-hit Mitsubishi back to health.
Spokesmen at DaimlerChrysler and Mitsubishi denied that Eckrodt would step down.
Mitsubishi added it planned no announcement concerning its domestic and overseas operations, saying it would unveil a business plan at its annual earnings announcement, around May.
But many analysts said they expected a plan along the lines of the newspaper report.
"We believe that for Mitsubishi to revive itself, it is indispensable that there are new personnel appointed to senior positions who have a good grasp of Mitsubishi's business and the leadership abilities to see the company through this period," Nikko Citigroup analyst Noriyuki Matsushima said in a memo.
With Mitsubishi Motors in need of funds to develop cars, DaimlerChrysler and other Mitsubishi group companies are expected to extend it 200 billion yen ($1.90 billion) soon.
Analysts worry that won't be the last time Mitsubishi draws on its partner's cash. But DaimlerChrysler faces a more urgent task of reviving its tattered U.S. Chrysler division and can't afford to let anything slip at its money-making Mercedes arm.
The German-U.S. automaker has already extended $492 million to shore up Mitsubishi's balance sheet by buying an additional 22 percent stake in its healthy truckmaking arm.
The Nikkei also reported this week that poor sales in the U.S. would push Mitsubishi's group operating loss for the year to end-March to about $947 million in what was meant to be the final year of three years of restructuring.
That would be more than double the $426 million loss projected three months ago and a far cry from the $784 million profit booked last year.
Mitsubishi's fortunes stand in stark contrast to the success story at Nissan Motor Co. Japan's No.3 carmaker went from near-death to the world's most profitable carmaker within four years under the reign of comeback king Carlos Ghosn, sent in from French partner Renault SA.
Eckrodt has always rejected any comparison with Ghosn as unfair, saying Mitsubishi was starting under worse conditions plagued by consumer distrust after a recall coverup scandal.
But analysts say management was at least partly responsible for not dealing more hastily with the risks brewing at its North American finance unit stemming from shoddy credit controls.
Troubles at the unit are at the center of Mitsubishi's woes, and forced the automaker to set aside huge extraordinary provisions that led to the big net loss in the first six months.
"Among the 11 Japanese carmakers, eight are expected to report record profits this year, and there's only one company expected to lose money and that's Mitsubishi Motors," said Koji Endo, senior analyst at CSFB Securities.
"There's no question that Mitsubishi is facing the worst in terms of fundamentals."
Analysts said Mitsubishi also needed to shed its excess production capacity in Japan -- utilization is at just 76 percent -- and introduce competitive models earlier than it has in the past.
While the maker of the Colt subcompact is enjoying a recovery in Europe and rising sales in Asia, sales continue to slide in its most crucial U.S. market after Mitsubishi stopped extending loans to customers with shaky credit histories.
With few new models in the pipeline, Mitsubishi faces an uphill battle in reversing the seven-month slide in U.S. sales.
Profits are under pressure from margin-eroding sales incentives such as rebates and free financing. The dollar's plunge against the yen also threatens to eat away at earnings garnered overseas.
Mitsubishi will report third-quarter sales Thursday.