Japanese auto maker Mitsubishi has announced plans to produce a new Outlander Sport Crossover SUV beginning in 2012 at its Normal plant in downstate Illinois.

The ailing plant, which was on the verge of being closed down, had decreased production and all the models were due to be phased out of production by 2014.

According to the Chicago Tribune, the Illinois Governor, Mr Pat Quinn, met with Mitsubishi executives at the plant today to announce the deal.

Mitsubishi would invest $45 million to produce the new Outlander Sport Crossover in Normal after the state offered $30 million in tax incentives over 10 years to keep the plant open.

The local union also struck a deal worth millions of dollars to Mitsubishi to cut and freeze wages through 2015. It is the only Japanese plant in the US whose employees are members of the United Auto Workers union.

According to the Chicago Tribune, the Mitsubishi Motors’ North America President, Mr Shinichi Kurihara, said: “With the new model, the plant will have better utilisation and of course, we will see improved efficiency when we eventually consolidate to one model with higher production volume.

I fully expect this plant will strongly improve its performance further down the road.”

Mr Kurihara said that about half the Outlanders would be exported.

Mitsubishi started producing cars at its plant in 1988. But due to problems, in 2004, it reduced one-third of its workforce by laying off more than 1,000 employees at its downstate plant.

The Mistubishi Plant now employs 1,300 workers and last year, it produced 30,000 vehicles including Mitsubishi Galant, Eclipse, Eclipse Spyder convertible, and Endeavor SUV.

Related Topics