Mitsubishi lowers its profit following the mileage scandal image

The Japanese automaker has adjusted downwards its profit over the last year, following the damages inflicted by the fuel economy testing scandal.

For the financial year ended in March, the automaker initially posted last month an operating income of 138.4 billion yen (1.27 billion dollars), a 2 percent or 2.5-billion-yen increase year-on-year, and a net income of 89.1 billion yen (810 million dollars), a 25 percent or 29.1-billion-yen decrease year-on-year. However, following the costs triggered by the fuel economy tests manipulation, the automaker cut its earnings by 19.1 billion yen (174 million dollars), for the total profit to now amount to 72.6 billion yen in 2015. The scandal forced the automaker’s President Tetsuro Aikawa to step down effective June 24, alongside its Executive Vice President Ryugo Nakao. It also opened the door for Nissan to buy a 34 percent stake in Mitsubishi for about 2.2 billion dollars.

The recently announced financial loses take into account an estimation of costs to compensate customers, as there are around 625,000 mini-cars sold in Japan with “improper” fuel data readings. As the scandal affects two Nissan models as well, Renault’s alliance partner will also have to bring its contribution, but with Mitsubishi paying Nissan’s portion of the expenses, Bloomberg reported, quoting Shinji Akiyama, a Mitsubishi Motors spokesman.

Separately, Mitsubishi said that Mitsuhiko Yamashita, currently a senior technology adviser at Nissan, would become its head of research and development, and Chairman and CEO Osamu Masuko would also add the role of president.

Via Bloomberg