Mitsubishi Motors Corp. and the United Auto Workers are partnering to identify a “suitable buyer” to assume operations of the company’s only U.S. production facility.
The collaboration follows the Japanese automaker’s announcement it will end production at its Normal, Illinois plant at the end of November — potentially leaving about 1,230 employees, including 900 UAW members, without work.
“This difficult decision follows years of challenge to remain viable, and was compelled by the combination of insufficient U.S. sales and low production capacity utilization,” said Hiroshi Harunari, Mitsubishi Motors executive vice president in charge of overseas operations, in a statement.
Annual production at the 2.4 million-square-foot plant, which makes the Outlander SUV, dwindled from more than 222,000 in 2000 to 69,000 last year. The company represented less than 1 percent of the total U.S. new vehicle market in 2014, according to industry data.
Harunari stressed that the company’s decision to exit production “is unrelated to labor costs or our relationship with the UAW.”
UAW Secretary-Treasurer Gary Casteel, who serves as director of the union’s Transnational Department, pledged the support of the international union to find a buyer that will continue production at the plant: “We will explore all possibilities and leave no stone unturned in assisting the leadership of UAW Region 4 and UAW Local 2488,” he said in a release.
Production of the Outlander Sport will be consolidated in Japan, pending a final decision by Mitsubishi’s board of directors on July 30. Mitsubishi Motors will continue to sell its cars, including current and planned models, at Mitsubishi dealerships across the United States.
Mitsubishi Motors’ production in the U.S. started in 1988 as Diamond Star Motors (later re-named as MMNA), a joint venture with Chrysler Corp. that ended in 1991 with Mitsubishi buying Chrysler out.
Chrysler, now known as FCA US, declined to comment on the possibility of the company purchasing the facility. FCA US, like many automakers, currently faces production constraints in the U.S.
Besides costing millions — if not billions — to retool, the facility’s location and size are other potential concerns.
“Given the fact that we have fairly tight capacity ... there’s at least some potential there,” said IHS Automotive analyst Mike Wall about an automaker purchasing the facility. “But it’s still not an easy investment by any stretch.”