Mitsubishi Motors (OTC:MMTOF) has reportedly decided to cease automobile production in China.
Mitsubishi's China sales lag was due to rising EV popularity and strong local brands, and other Japanese automakers may also reassess their strategies, reported Nikkei Asia.
The report added that the company has started final withdrawal talks with China's Guangzhou Automobile Group (GAC), with which Mitsubishi has a joint venture.
GAC Mitsubishi Motors owns a manufacturing plant in Hunan province, which ceased production in March and will remain inactive. This facility is Mitsubishi's sole production site in China, the report noted.
In 2022, Mitsubishi's car sales in China plummeted approximately 60% YoY, with 38,550 units sold.
GAC reportedly plans to convert the Hunan plant for EV manufacturing. GAC owns 50%, Mitsubishi Motors 30%, and Mitsubishi Corp. (OTC:MTSUY) 20% of GAC Mitsubishi. The entity will persist, but the latter two are pulling their investments, added the report.
GAC Mitsubishi Motors was established in 2012 and sold 140,000 vehicles in 2018, the report noted.