Mitsubishi Motors to close RI car plant in June

Mitsubishi Motors to close RI car plant in June

Dow Jones Tokyo

Mitsubishi Motors Corp. said on Tuesday it will close its car- making plant in Indonesia in June as it tries to reorganize its global operations as part of its restructuring efforts.

The Japanese automaker's passenger car output in Indonesia has been declining as the two models manufactured at the plant have been in the market for a while, and the company has been importing cars from other plants in Asia.

Mitsubishi produces the Kuda minivan and the Galant sedan at its Indonesian affiliate, P.T. Krama Yudha Kesuma Motors, a Mitsubishi Motors spokesman said.

In 2004, Mitsubishi Motors made 4,890 cars at the Indonesian plant, the spokesman said.

Such a figure is very low considering the plant at one time produced more than 20,000 cars a year.

The plant closure is in line with Mitsubishi Motors' product strategies under its restructuring plan announced earlier this year.

The carmaker is reducing the number of regional models it produces and putting more resources into globally marketed models.

Reorganization of the Indonesian operations is one of the business improvement measures outlined in the restructuring plan.

The spokesman said Mitsubishi will lay off some 300 workers at P.T. Krama Yudha Kesuma Motors.

The workers have been on a strike since the company notified them of the plant closure, but the local government is making an arbitration proposal later this month, the spokesman said.