Mitsubishi Will Stop Making Cars In China: Report

The decision has been taken due to weak demand, with sales dropping by 60 percent in 2022.

By: Adrian Padeanu

Sep 28, 2023 at 5:56am ET

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China is an increasingly competitive market, and some of the global brands have discovered that the hard way as big names in the industry are noticing a weaker demand. The situation is particularly bad for Mitsubishi, so much so that it has apparently decided to end local production in the world's most populous country. Nikkei Asia reports the company wants to withdraw its investment in the local joint venture with the Guangzhou Automobile Group.

GAC Mitsubishi Motors was established in 2012 as a JV between the two companies, but sales peaked back in 2018 at 140,000 units. Last year, deliveries to customers dropped to 38,550 units, or approximately 60 percent less compared to 2021. Production at the factory in the Human province was halted in March 2023 and Mitsubishi has apparently no intentions to resume operations.

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The plant will not be shut down as GAC is likely to use the facility to produce electric vehicles. The Chinese automaker has a 50-percent stake in the joint venture while Mitsubishi Motors owns 30 percent. The remaining 20 percent belongs to the trading house Mitsubishi Corp. According to Nikkei Asia, GAC Mitsubishi will continue to exist as a corporate entity, but the two Mitsubishi companies are pulling out their investments.

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The funds will reportedly be redirected to operations in Southeast and Oceania as these regions represent roughly a third of annual sales. Mitsubishi is not the only Japanese brand on a downward trend in China as automakers from the Land of the Rising Sun had a market share of 18.3 percent in 2022 or 2.8 percent less than the year before.

Mitsubishi has been keeping busy in other markets this year by launching new products. We're primarily talking about the new L200 / Triton but there's also the Xforce small crossover for South Asia, Latin America, the Middle East, and Africa. The company also rebadged the Renault Clio for a "new" Colt in Europe and introduced a Delica Mini at home in Japan.