Mitsubishi to pull plug on U.S. vehicle production, sell plant

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Reports out of the U.S. Friday say Mitsubishi Motors will cease production at its Illinois factory and seek a buyer for the plant just a few years after securing state incentives.

The Chicago Tribune says the move could affect up to 1,280 full-time positions at the Normal, Ill.-facility.

Initial published reports out of Japan indicate the move stems from the automaker’s desire to focus on Asian markets.

“Following a review of Mitsubishi Motor Corporation’s global supply chain, we have been informed it is necessary to end production and seek a strategic buyer for the Normal plant,” spokesman Alex Fedorak said in a statement Friday.

He added that the company’s board will make a formal decision in the near future noting that Mitsubishi’s “focus right now is to identify a buyer who would continue to operate and maintain employment – the best potential outcome for our employees and the community.”

The company stressed it would continue to sell cars in North America.

According to Reuters, the Illinois factory opened in 1988 as Diamond-Star Motors Corp., a joint venture between Mitsubishi and Chrysler. Mitsubishi bought the 50 per cent of the operation that it didn’t already own from Chrysler during the 1990s. At it’s peak, annual production topped 200,000 units.
 
It dropped to one shift in 2004 and, after several years of sliding sales in the U.S., Mitsubishi said it would phase out production at the facility roughly four years ago.

The paper says the state then pledged nearly $30 million in incentives in exchange for an addition $45 million investment from the company to produce the Outlander Sport crossover.

The Normal plant is the only Japanese-owned U.S. auto factory whose hourly workers are represented by the UAW.

There is no word yet from Mitsubishi Canada officials regarding how this will affect sales and the inventory pipeline for Canadian dealers.

The Canadian press launch for the 2016 Mitsubishi Outlander is scheduled to take place in Vancouver and Whistler starting next Thursday.

- With files from the Chicago Tribune and Reuters