Japanese automakers Mitsubishi, Mazda and Subaru said Wednesday they will post losses for the year through March as a deepening global slump devastates the industry.
Faced with the credit crunch, Mitsubishi Motors Corp. also said it would pull out of the Dakar Rally, which it has won 12 times, dealing another hard blow to world motorsports. Mazda said it would eliminate 500 more jobs.
The companies said a double whammy of sliding sales and an appreciating yen were eating badly into it profits. Japan's three biggest automakers — Toyota, Honda and Nissan — have also been hit hard, with all of them cutting jobs.
The dire situation the carmakers are in marks a dramatic pullback from a year ago, when many firms enjoyed record sales and profits thanks to robust exports of small and environmentally friendly cars to the United States.
Mitsubishi Motors, the nation's fourth-largest carmaker, feared that the global downturn would last well into next year.
“At this point, I cannot judge that things will bottom out in fiscal 2009,” Mitsubishi Motors president Osamu Masuko told reporters.
“We are bracing ourselves for an extremely difficult operating environment in fiscal 2009,” he said.
Mitsubishi forecast a net loss of 60 billion yen (670 million dollars) for the year to March, against a year-earlier profit of 34.7 billion yen.
Mitsubishi had earlier projected a profit of 20 billion yen in the current year.
Analysts warned that Japanese automakers outside of the Big Three faced threats to their very survival if they cannot shift back to profit.
“As automakers' earnings have been worsening rapidly since the turn of the year, (Mitsubishi Motors') survival will be called into question,” said Mamoru Kato, auto analyst at Tokai Tokyo Research Center.
Kato said that Mitsubishi Motors may be forced to seek an alliance with a competitor overseas.
Mazda Motor Corp., Japan's fifth largest automaker, blamed sagging US sales for its expected losses and said it would cut 500 jobs in Japan.
Mazda will now be eliminating a total of 2,000 temporary workers at home.
“At a time when even half of our regular workers aren't coming to work, we can't renew contracts for our non-regular workers,” Mazda chief executive Takashi Yamanouchi told reporters.
“We're in a situation where we don't know where we stand. That's how severe it is,” he said.
Mazda, whose biggest shareholder is ailing US giant Ford, said it now forecast a net loss of 13 billion yen (145 million dollars), a drastic turnaround after posting a record net profit of 91.84 billion yen last year.
The firm said it still enjoyed sales growth of 38 percent in China in the first nine months of the year, but sales dropped both in Japan and the United States in the same period.
Mazda said it would open as scheduled a passenger car factory this week in Thailand, to be operated jointly with Ford.
“We will go ahead and roll out vehicles but we will be assessing output by closely watching demand,” Yamanouchi said.
Fuji Heavy Industries, which makes the Subaru brand vehicles, said it lost 165 million dollars in the nine months to December.
The company maintained its outlook to end the financial year to March in the red for the first time since 1994, expecting a net loss of 19 billion yen.
Fuji Heavy said in December it was pulling its Subaru team out of the world rally championship because of the rapidly worsening business climate.
The US Big Three — Ford, Chrysler and General Motors — have also been hit severely by the economic downturn, forcing them to turn to the government for a bailout.
