Mitsubishi puts the brakes on European production

06/02/12 14:43 CET

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Mitsubishi Motors has said it will stop production at its only factory in western Europe at the end of this year.

The Netherlands Car, or NedCar, plant in the Netherlands employs about 1,500 people making Colt cars and Outlander four-wheel-drive vehicles. When the news was announced some angry workers blocked the entrance to the factory with vehicles.

Henk van Rees of the FNV trade union said: “Mitsubishi has always told these people that they were the best, and now they put their best personnel on the rubbish dump.”

NedCar’s Joost Govaart countered: We have looked all over the world to a find third party who is interested in the production capacity of NedCar. This search has turned up a few parties with whom we are talking. We shall approach these parties and ask them if they are still interested.”

The move was expected as Mitsubishi’s sales in Europe have dropped and it recently announced an operating loss in the region.

NedCar’s output has slumped to 50,000 vehicles a year compared with peak capacity of 200,000. The Japanese carmaker has not yet decided what to do with the plant.

It will supply vehicles to Europe from Japan and Thailand.

With demand in western Europe expected to remain sluggish, carmakers have been shifting focus to eastern Europe and other emerging markets where projected sales growth rates are higher.

Mitsubishi is building a new factory in Thailand and studying increasing production in China and Brazil, where sales growth is projected to be higher than in developed nations.