Mitsubishi Loss, Salaries of Bosses Trimmed

Tokyo –

Mitsubishi Motors Corporation (MMC) in Japan announced that they would not distribute dividends. The company was reported to be losing money.

Reported Japan Times, some time ago MMC CEO Takao Kato reported his company’s loss. Mitsubishi reported a net loss of 25.8 billion yen (Rp. 3.4 trillion).

It was said, this loss was the impact of car sales that were not excited. Just like other global automotive manufacturers, the sales decline was quite large due to the Corona virus pandemic (COVID-19) that hit the world.

Kato said that the salaries of executive officials at MMC would be cut to share responsibility for substantial financial losses.

Information that was officially announced said that Mitsubishi would cut the salaries of its bosses by up to 45%.

Interestingly, one of the shareholders who attended the meeting objected to the deduction of salaries of company officials. He encouraged the Mitsubishi boss to use his salary to help stimulate the domestic economy. Kato replied that it was not right for them to receive the same remuneration because the shareholders did not receive dividends with companies that declared large losses.

Aftermath of this loss, Mitsubishi will also save money. Mitsubishi will focus on cutting fixed costs by 20% or more in the next two years. The cost cut follows after Mitsubishi reported an annual profit decline of up to 89%, the weakest performance in three years.

The crisis when the Corona virus pandemic (COVID-19) exacerbated Mitsubishi’s struggle in one year. The three-diamond car manufacturer is struggling against falling sales in China and Southeast Asia, its biggest market which accounts for a quarter of Mitsubishi sales.

Mitsubishi also said it would focus on ASEAN countries to survive during the pandemic.

“Before the virus, we have considered areas and vehicle segments that are performing poorly to reduce our exposure. After the virus, we need to take steps to make this change. To remain competitive in the Corona postvirus market, we must immediately reduce our focus to the region and our superior segment, “said Kato.

Mitsubishi, the youngest member of the Renault-Nissan alliance, sold 1.13 million cars globally in the fiscal year. That number is down 9%.

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(RGR / your)

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