Mazda To Close Hiroshima Plant And Transfer Truck Production to Isuzu Unit

TOKYO, Oct 21 Reuters reported that Mazda Motor Corp, said on Monday it planned to transfer production of commercial trucks to Press Kogyo Co Ltd, a unit of truck maker Isuzu Motors Ltd, from next spring.

The automaker also announced that it planned to close its truck and van plant in Hiroshima in the 2004 business year.

At the same time, Mazda said it planned to reopen a separate plant on the Mazda estate in the western city.

"These plans are entirely consistent with our Millennium Plan Strategy. They are important enablers of our growth plans, while improving our overall asset utilisation," Mazda president Lewis Booth said in a statement.

By reopening the Ujina plant facility, Mazda said it would boost annual domestic output capability for all types of vehicles by 14 percent to 898,000 units.

After spending much of the 1990s in the red, Mazda managed to return to profit last year with the help of partner Ford Motor Co, which led it through six years of restructuring.

Press Kogyo will take over production of Mazda's truck line -- Titan, Titan Dash, Bongo Truck, Bongo Brawny Truck.

Sales of the four models account for 13 to 15 billion yen ($104-120 million) in annual sales, Press Kogyo said.

Demand for trucks has been on the decline in Japan due to the sluggish economy, and analysts say the industry is too crowded anyway with four major truckmakers vying for a market that absorbed 943,591 light trucks and 83,038 heavy trucks in 2001.

The re-balancing of domestic production capacity aims to improve overall operating efficiency and will have no impact on the products Mazda offers or on employment levels at the company, Mazda said in statement.

The Hiroshima plant, which Mazda plans to close, is the oldest of the automaker's factories. It opened in 1960.