TOKYO (Reuters) – Mitsubishi Motors Corp (7211.T) plans to boost sales volume and revenue by 30 percent in three years and spend more on research and development (R&D), as the automaker expands in the United States and China and moves on from a mileage cheating scandal.
Announcing its mid-term plan through March 2020, Japan’s seventh-largest automaker on Wednesday said it aimed to raise annual global sales to 1.3 million vehicles, and increase its operating margin to 6 percent or more from 0.3 percent.
Mitsubishi said it aimed to increase annual capital spending by 60 percent to 137 billion yen ($1.22 billion), or 5.5 percent of annual sales, and R&D investment by 50 percent to 133 billion yen. Together, the spending targets represent more than 600 billion yen over the duration of the plan.
The mid-term plan is Mitsubishi’s first since compatriot Nissan Motor Co Ltd (7201.T) bought a controlling stake last year after Mitsubishi admitted to overstating the fuel economy of some domestic models.
“We will rebuild trust in our company as our highest priority, successfully launch new vehicles, and achieve a V-shaped financial recovery,” Mitsubishi Chief Executive Osamu Masuko said in a statement.
“These will be the foundations for our future sustainable growth, which will involve increased capital expenditure and product development spending.”
The automaker is also targeting cost-savings of more than 100 billion yen over the next three years due to development and procurement efficiencies created after becoming a member of the automaking alliance of Nissan and Renault SA (RENA.PA).
Focusing on growing market share in the U.S. and Asia, including Japan and China, Mitsubishi will release 11 models over three years, including the Eclipse Cross compact sport utility vehicle (SUV) which began shipping to Europe this month, and Xpander multipurpose vehicle unveiled earlier this year.
It will also launch an electric minicar in Japan from 2020.
Mitsubishi has been working to expand particularly in fast-growing emerging Asian markets where it is most profitable, opening an assembly plant in Indonesia earlier this year.
Reporting by Naomi Tajitsu; Editing by Christopher Cushing