Mazda, Mitsubishi Rebound To Post Quarterly Profits

Both Mazda and Mitsubishi, Japan's No. 4 and No. 5 automakers,  posted net profits for the January-March quarter, thanks to cost-cutting and government stimulus measures.

TOKYO (AP) -- Mazda and Mitsubishi -- Japan's No. 4 and No. 5 automakers -- posted net profits for the January-March quarter, reversing losses from a year earlier thanks to cost-cutting and government stimulus measures that helped along a gradual global recovery.

Mazda Motor Corp. said Tuesday it notched a net profit of 9.9 billion yen ($105 million) for the fiscal fourth quarter after losing 100.4 billion yen a year earlier. That helped slash its full-year loss to 6.5 billion yen ($69 million) from a much bigger 71.5 billion yen in red ink the previous year.

The company said it expects a net profit of 5 billion yen for the current year through March 2011.

Hit by the yen's appreciation and weaker demand in all major markets save China, Mazda's annual sales fell 15 percent to 2.164 trillion yen.

"The recovery of automotive industry demand still lacks momentum, except in China and other emerging markets," it said in a release. Sales in China jumped 46 percent to 196,000 vehicles for the fiscal year, boosted by sales of the Mazda6.

Faced with a "challenging" business environment, Mazda said it worked hard to optimize inventory levels and accelerated cuts to fixed costs by over 100 billion yen, even though its domestic plants were operating at 80 percent utilization.

It plans to launch the new Mazda5 globally, and the Mazda2 in North America.

Globally, Mazda sold 1.193 million vehicles during the fiscal year, down 5 percent. Annual sales in North America slid 12 percent to 307,000 units, those in Europe dropped 26 percent to 239,000, while in Japan sales edged up 1 percent to 221,000 units.

Mitsubishi Motors Corp., which makes the Pajero sport utility vehicle and the i-MiEV electric car, reported a 30.5 billion yen ($328 million) profit for the January-March quarter, a reversal from a 50.1 billion yen loss.

Mitsubishi said Japanese government incentives such as tax breaks on "green" models helped boost sales at home. In other parts of the world, China particularly, the automaker also got a lift from tax breaks and other incentives aimed at boosting car sales.

Sales in China were up more than 60 percent from the previous year, and were solid in Taiwan, Thailand and the Philippines, it said.

Mitsubishi recorded 4.76 billion yen ($51 million) in net profit for the fiscal year ending March 31. It had a 54.9 billion yen loss the previous fiscal year.

It is forecasting net profit to improve to 15 billion yen for the fiscal year through March 2011.

Annual sales fell 27 percent to 1.446 trillion yen ($15.5 billion), largely because of the slowdown in the first part of the year and the effects of the strong yen, which erodes the value of overseas revenue.

But Mitsubishi is expecting sales to recover to 1.9 trillion yen ($20 million) for the fiscal year through March 2011. It sold 960,000 vehicles around the world in the fiscal year ended March 31, down from 1.07 million the previous year.

AP Business Writer Yuri Kageyama contributed to this report.


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