Editor's note: The original version of this story, which appeared on Page 20 of the Aug. 5 issue, mischaracterized Mitsubishi Senior Executive Officer Yoshihiro Kuroi's comments about the timeline for achieving break-even operating profit in North America. He said the company intends to make the most of this year's positive market trends to achieve break-even as quickly as possible.
TOKYO -- Mitsubishi's loss-making North American operations may reach breakeven for the first time since 2007 as local production and favorable exchange rates erase the red ink.
Mitsubishi Motors Corp. hasn't booked a regional operating income there since the fiscal year ended March 31, 2007, when it logged a tiny profit of ¥600 million ($6.37 million).
But the company is clawing back to black, thanks to ramped-up production of the Outlander Sport compact crossover in Normal, Ill., and a weakening yen, said Yoshihiro Kuroi, senior executive officer in charge of corporate planning.
In the April-June fiscal first quarter, the North American operating loss narrowed to ¥2.3 billion ($24.43 million), Kuroi said last week at the company's earnings announcement.
It marked an improvement over a loss of ¥7.4 billion ($78.59 million) a year earlier, despite the fact that North American sales stagnated at about 23,000 vehicles in the quarter.
Mitsubishi began producing the Outlander Sport in Illinois in July 2012. Its introduction helped soak up capacity at a factory that was phasing out older models such as the Endeavor crossover, Galant sedan and Eclipse sporty car. The move also offset exchange rate losses on importing the vehicle.
Meanwhile, the weakening yen lifted profit margins on Japan-made vehicles, including the standard Outlander crossover and Lancer sedan, which account for half of Mitsubishi's U.S. sales.
"The trend of improving earnings will continue," Kuroi said. "We want to make the most of the opportunity this year to approach breakeven as quickly as possible."
Mitsubishi sold about 23,000 vehicles in North America in the period, just under a quarter of its full-year goal of 100,000 units.
Globally, Mitsubishi's net income declined 18 percent to $174.60 million in the fiscal first quarter. Revenue dipped 2 percent to $4.35 billion, while worldwide sales climbed 4 percent to 249,000 vehicles.