Mitsubishi shares down 20% after it lied about fuel-efficiency tests
After a shocking admission of falsifying fuel-efficiency tests, Mitsubishi shares nosedived again on Thursday as panicked selling wiped about $2.5 billion off the automaker's market value in just two sessions reports AFP. The embattled stock went into freefall, down 20 percent, after losing 15 percent on Wednesday when the news first broke, this comes after the Japanese government officials raided an R&D office of Mitsubisihi earlier in the day.
“This has critically damaged consumers’ trust and it won’t be tolerated,” top government spokesperson Yoshihide Suga said on Thursday. “It’s an extremely serious issue.”Mitsubishi’s Tokyo-listed shares looked set to plunge about 20% on Thursday but were untraded owing to an overwhelming number of sell orders. The firm plunged 15% on Wednesday before it confirmed reports about its misconduct, which saw unnamed employees rig tests to make cars seems more fuel-efficient than they were.
Mitsubishi said it would halt production and sales of the affected vehicle models -- mini-cars sold in Japan including some made for rival Nissan -- and warned that the number of affected vehicles would likely rise.The embarrassing revelation follows a massive pollution-cheating scandal at Volkswagen that erupted in September and which the German giant is still struggling to overcome.
Mitsubishi’s top executive conceded on Wednesday that the brewing crisis would take a bite out of the automaker’s bottom line as it widens its probe to cars that it sold overseas.“This is not a simple problem and we need time” to assess the impact, Mitsubishi president Tetsuro Aikawa told a news briefing.“But I’m sure there will be an impact. The damage will be big.”The rigged figures were discovered after Nissan found inconsistencies in fuel-economy data and reported it.
Japan’s number-two automaker said it would halt sales of the affected mini-cars but added that it had no immediate plans to change its business relationship with Mitsubishi.Mini-cars, or kei-cars, are small vehicles with 660cc gasoline engines that are hugely popular in the Japanese market, although have found little success abroad.Mitsubishi sold more than a million vehicles at home and overseas in its latest fiscal year.