Fuel-cheating scandal wipes $2.5bn off Mitsubishi stock
TOKYO - Mitsubishi Motors shares nosedived again Thursday as panic selling wiped about $2.5 billion off the automaker's market value in response to its shock admission that it cheated on fuel-efficiency tests.
The embarrassing revelation is the latest in a string of recent scandals to hit Japanese firms, while German giant Volkswagen struggles to restore its badly dented reputation after a massive emissions scandal.
The news has also raised questions about Mitsubishi's future as it faces the prospect of huge lawsuits and fines.
On Thursday, the embattled stock went into freefall, plunging to 583 yen ($5.31) in Tokyo, down 20 per cent, after it dived 15 per cent on Wednesday when the news first broke.
Japanese transport ministry officials descended on a company research and development centre Thursday morning, as the government slammed the maker of Outlander sport utility vehicles and Lancer cars.
"This has critically damaged consumers' trust and it won't be tolerated," top government spokesman Yoshihide Suga said Thursday. "It's an extremely serious issue."
Mitsubishi admitted Wednesday that unnamed employees rigged tests to make some of its cars seem more fuel-efficient than they were in reality.
The company 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 cars involved in the scandal would likely rise.
Mitsubishi's top executive conceded Wednesday that the crisis would take a bite out of its bottom line, as the firm widens an internal probe to cars sold overseas.
"This is not a simple problem and we need time" to assess the impact, president Tetsuro Aikawa told a news briefing.
"But I'm sure there will be an impact. The damage will be big."
- AFP
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