Mitsubishi has been making headlines lately, largely due to its potential involvement in the merger between Nissan and Honda. However, this development does not bode well for the Japanese automaker as it announces a dismal net profit forecast for the fiscal year ending March 2025.
Specifically, the company has adjusted its net profit forecast for the fiscal year 2024 to a mere 35 billion yen (approximately $226 million), a staggering 76% decrease from its previous forecast of 144 billion yen made in May 2024.
The primary reasons for this downward revision include weak wholesale volumes, increased promotional costs due to intensified competition in the North American market, and the impact of inflation on areas such as supplier support and other accumulated expenses. For context, Mitsubishi earned 154.7 billion yen ($1.014 billion) in the fiscal year 2023.
The company has also lowered its sales forecast from 895,000 units to 848,000 units for the fiscal year 2024. However, the post-revision figure still represents a slight increase from the 815,000 units sold in the fiscal year 2023. Much of this decline stems from Mitsubishi’s largest market, Southeast Asia, particularly Thailand, Indonesia, and Malaysia, where the company faced challenges in the third quarter of 2024.
“Thailand used to be a market that consumed one million cars a year,” said Takao Kato, CEO of Mitsubishi, in an interview with Nikkei Asia on February 3, 2025. “Demand for cars in this market has not recovered significantly post-COVID-19 and has, in fact, declined faster in fiscal 2023 and 2024 due to high household debt.”
Kato attributed the continued negative impact on Mitsubishi’s profits to Thailand’s unfavorable exchange rates and rising household debt. The situation has prompted Mitsubishi to restructure its offices in the Southeast Asian region, including offering early retirement to 300 employees.
However, it’s not all doom and gloom for Mitsubishi. Despite rumors of its exclusion from the Honda-Nissan merger, Kato indicated that the likelihood of this scenario is low. He stated that the company would wait to see how the merger unfolds before making any decisions about the timing and nature of its involvement.
“Our strengths lie in plug-in hybrid vehicles, our presence in the Asia-Pacific market, and our focus on pickup trucks,” Kato added. “We are considering how to utilize these products and what kind of support we can expect in the North American market while also developing automotive intelligence, both areas in which we are not strong.”
In contrast to the challenges faced in Southeast Asian markets, Mitsubishi experienced robust growth in Vietnam in 2024. Last year, the company sold a total of 41,198 vehicles in Vietnam, a 33% increase from 2023, ranking fifth in the Vietnamese market after VinFast, Toyota, Hyundai, and Ford.
This success is largely attributed to two key models, the Xpander and the Xforce, which sold 19,498 and 14,407 units in Vietnam in 2024, respectively. The Mitsubishi Xpander, in particular, was the best-selling gasoline and diesel car in the market. Meanwhile, the other models in Mitsubishi’s lineup in Vietnam fell short in terms of sales.
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