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Mitsubishi Motors Swings to Loss, Slashes its Full-Year Outlook

November 11, 2003

Mitsubishi Motors Corp. on Nov. 11 said it swung to a loss for the fiscal first half on bad auto loans and weak sales in North America, forcing the Japanese auto maker to acknowledge it was stumbling in the third year of a turnaround under a partnership with DaimlerChrysler AG of Germany, according to The Wall Street Journal.

For the six months ended Sept. 30, Mitsubishi Motors reported a net loss of ¥80.2 billion ($739.2 million), compared with a profit of ¥6.64 billion a year earlier, although the results were in line with the company's projections, the Journal reported.

As part of its revival with DaimlerChrysler, which owns 37 percent of Mitsubishi Motors, the automaker has cut costs, developed cars together and boosted profits in the last two fiscal years, which were the first two years of the planned turnaround, according to the Journal.

Eckrodt acknowledged the unexpected problems in North America would mean a delay in the turnaround. The high cost of U.S. incentives, which are discounts auto makers offer on cars, also hurt first-half results although Mitsubishi's incentives are lower than those from American automakers, The Wall Street Journal said.

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