Mitsubishi Motors, which could not reach the targets it wanted in the Chinese market, announced that it will stop investments in this country. Accordingly, it announced that it will exit its joint venture operations and invest in Renault’s electric car company.
Mitsubishi halts production in China
The Japanese carmaker said it is suspending plans for China. Accordingly, it said it would transfer the joint venture run by Guangzhou Automobile Group and Mitsubishi Corp. The 12-year-old joint company was producing Mitsubishi vehicles in China.
From now on, Mitsubishi’s plant will only produce China-only GAC and Aion electric cars. This move is part of the competition and sales pressure that foreign automakers face in the Chinese market. Previously, Volkswagen’s market share in the country had hit rock bottom.
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Mitsubishi Motors also stated that exiting the joint venture would damage the company. It said it would suffer a loss of 162 million dollars related to restructuring costs. However, it maintained its annual profit forecast.
On the other hand, Mitsubishi announced that it will invest up to 200 million euros in Renault’s electric vehicle unit Ampere. Renault plans to list Ampere as a separate company next year to accelerate its electric vehicle push.
With this investment, the cooperation between Mitsubishi and Renault/Nissan will also expand. It is possible that Mitsubishi will access Ampere’s EV technology to develop its own electric cars.
As part of the partnership, Ampere will supply Mitsubishi with electric vehicles and help the Japanese brand expand its product range in Europe.
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