Mitsubishi Motors Corp. reported a sharp 73% drop in net income for fiscal year 2024 despite increased vehicle sales, as the automaker struggles with rising costs and regional market challenges.
The Japanese carmaker saw net income fall to ¥41 billion ($US) in the year ended March 31, down from ¥154.7 billion a year earlier. Operating profit declined 27% to ¥138.8 billion while maintaining essentially flat sales of ¥2.79 trillion.
Operating profit margin contracted to 5.0% from 6.8% in the previous year, reflecting significant cost pressures. The company managed to increase global retail sales volume by 3% to 842,000 units, driven primarily by strong performance in North America (+14%) and Japan (+6%).
“Market conditions remain volatile across our key regions,” the company indicated in its presentation materials. Particularly challenging was Thailand, where rapid increases in Chinese BEV imports disrupted the market, contributing to the profit decline.
The company’s outlook appears even more challenging, with FY2025 operating profit forecast to fall further to ¥100 billion, representing another 28% decline. This projection includes an anticipated ¥40 billion negative impact from tariffs. Mitsubishi also announced it would cut its dividend to ¥10 per share from ¥15.
The automaker is pivoting its strategy to focus more on hybrid electric vehicles rather than fully electric models, citing plateauing global BEV growth. Plans for FY2025 include expanding ASEAN market share through new model launches and strengthening its position in Vietnam and the Philippines.
Mitsubishi’s “Challenge 2025” mid-term plan targets now appear increasingly difficult to achieve, with the company acknowledging it will likely fall substantially short of its 1.1 million unit sales volume and ¥220 billion operating profit goals.
