© Reuters. FILE PHOTO: Employees stand in front of the Mitsubishi Motors logo at the 2022 Tokyo Auto Salon at Makuhari Messe in Chiba, east Tokyo, Japan on January 14, 2022. REUTERS/Kim Kyung-Hoon
TOKYO (Reuters) – Mitsubishi Motors Corp. will extend its production suspension in China beyond May, the Yomiuri newspaper reported on Tuesday, highlighting the Japanese automaker’s struggles in the world’s largest auto market.
A company spokesperson said that Mitsubishi Motors (OTC:) is discussing when to resume production in China with its local partner, adding that there was nothing he could say about the timing.
The Japanese company said last month that it had halted production of its Outlander sport utility vehicle (SUV) in China for three months through the end of May and would charge $78 million in fees for slowing sales at its joint venture with state-owned GAC Group.
SUVs account for the bulk of the electric vehicle market in China, where price cuts and the introduction of new models from domestic and foreign brands have cannibalized sales of gasoline cars.
Yomiuri, citing multiple unnamed sources, said Mitsubishi Motors, which established its unit in China in 2012, had not decided when production would resume in the country.
The company and other Japanese automakers have faced a sales crunch in China as a rapid shift to electric vehicles has led to a decline in purchases of internal combustion engine vehicles. Mitsubishi Motors introduced the new Outlander model in China last December.