Third-Quarter FY 2003

During the third quarter of fiscal 2003, the unfavorable business development of the first half-year has continued and caused further pressure on the company's performance, largely caused by a substantial decrease in sales in relation to the previous year, primarily in the U.S. On the other hand, MMC was able to increase sales and its operational performance in Japan, Europe and in other major countries including China.

Based on improved performance for both passenger cars and minicars, retail sales in Japan in Q3 grew year-on-year by 5,000 units to 78,000 (249,000 units during the first 9 months of fiscal 2003, +13,000 YoY). Q3 sales in Europe - supported by MMC's fast growth in Eastern Europe - increased YoY by 5,000 units to 55,000 (Q1-Q3: 159,000 units, +8,000 YoY). Sales in North America in Q3 decreased by 31,000 units to 59,000 units (Q1-Q3: 209,000 units, -58,000 units). A major factor behind this decline has been the ongoing focus on profit over volume with a strict credit policy. In addition, the phase-out of the old Galant prior to the nation-wide launch of the new Galant on January 19, 2004, also led to lower sales. Q3 sales in Asia and the rest of the world remained basically stable YoY at 170,000 units (Q1-Q3: 518,000 units, +24,000 YoY). A very strong performance in China in Q3 (43,000 units, +17,000 YoY) balanced weaker sales in Malaysia.

"This year's business performance in North America is clearly disappointing. It overshadows the fundamental progress we made in other regions and most business areas from procurement and quality management to the marketing and design of our new cars," said MMC President and CEO Rolf Eckrodt. "Our regional performance outside of North America in fiscal 2003 will improve by nearly 60 billion yen compared to last year, and by over 180 billion yen compared to fiscal 2000."

Worldwide retail sales in the third quarter of fiscal 2003 decreased by 23,000 units from the same period a year ago to 362,000 units or by 13,000 units to 1,135,000 units for the first 9 months of fiscal 2003. Q3 consolidated net sales decreased YoY by 13 billion yen to 625 billion yen (US$5.84 billion, euro 4.66 billion)* this period; total consolidated net sales for the first 9 months of fiscal 2003 stood at 1.832 trillion yen (US$17.12 billion, euro 13.67 billion) versus 1.914 trillion yen during the same period in 2002.

Full-Year Forecast

For the entire fiscal year 2003, MMC forecasts worldwide unit sales of 1,520,000 (-23,000 or -1% versus fiscal 2002). The respective forecast for the four regions is as follows: Japan 360,000 units (+6,000 or 2% YoY), Europe 205,000 units (+5,000 or 3% YoY), North America 275,000 units (-68,000 or -20% YoY), Asia and the rest of the world 680,000 units (+34,000 or 5% YoY).

Consolidated net sales are now expected at 2.47 trillion yen (US$23 billion, euro 18.4 billion) (vs. 2.736 trillion yen in fiscal 2002). MMC expects an operating loss for the full-year 2003 of 105 billion yen (US$981 million, euro 783 million) (vs. +84 billion), an ordinary loss of 115 billion yen (US$1.07 billion, euro 858 million) (vs. +67.4 billion) and a net loss of 72 billion yen (US$673 million, euro 537 million) (vs. +43.9 billion). Excluding the high charges for credit loss provisions stemming from MMC's captive financing company in the U.S., which affected the first half-year result strongly, the expected second half-year result represents a slight improvement of the operational business over the first half-year figures.

The revised forecast takes into account recent trends in foreign exchange markets. MMC has adjusted its assumption for the average full year yen/dollar rate from 123 yen/$ in FY 2002 to 117 yen/$ for FY 2003, and for the average full year yen/euro rate from 117 yen in FY 2002 to 129 yen in FY 2003.

New Mid-Term Business Plan

In addition to the ongoing restructuring and turnaround plan announced in 2001, the management of MMC is currently working on a new mid-term business plan, which covers all operational and financial areas of the company in and outside of Japan. Several important elements of the plan are already being implemented. In North America, this includes cost reduction as well as revenue enhancement measures. In addition to postponing capacity expansion at its Illinois plant, the company is implementing a substantial white-collar and blue-collar workforce reduction in the U.S. New measures targeting higher revenues range from the introduction of a new marketing and advertisement concept to a new long-term warranty program started in January 2004, demonstrating the company's confidence regarding its high product quality level. MMC also recently announced it will enter the lucrative mid-size pick-up segment in North America in 2005 by tying up with Chrysler Group.

Both major shareholder groups will actively cooperate with MMC in the establishment of its new mid-term business plan as soon as possible.

DaimlerChrysler AG (DC), as strategic partner and major shareholder of MMC, welcomes these efforts and supports the team setting up the new, strong mid-term business plan including the development of the strategic global alliance with DC. Already today there is strong cooperation between MMC and DC. Several successful alliance projects are already in place, for example joint B-segment platform development and production with smart, a joint engine factory in Germany, joint platform for C- and D-segment cars with Chrysler Group, the world engine project, joint purchasing and volume bundling activities as well as joint distribution activities like those in China, Canada and Mexico. These projects play an important role in reestablishing MMC's profitability.

Mitsubishi Heavy Industries, Ltd., (MHI), Mitsubishi Corporation and the Bank of Tokyo-Mitsubishi, Ltd. (the "Mitsubishi Group Companies") also welcome MMC's actions as well as DC's support and will also continue to support MMC's management. In order to reinforce MMC's management, MMC will - after confirmation through a shareholder meeting to be held on April 30 - appoint Yoichiro Okazaki, currently Managing Director at MHI, as its new Chairman from the Mitsubishi Group Companies.

"This new mid-term business plan will form a clear roadmap of Mitsubishi Motors' future for our customers, employees, business partners and all other stakeholders. It will be based on a further acceleration of our internal reforms and on the support from both of our major shareholder groups," said Rolf Eckrodt.

The new mid-term business plan will consist of complementary operational and financial plans to assure a solid financial foundation for MMC's business. It is scheduled to be finalized and announced for immediate implementation in conjunction with the shareholder meeting on April 30. This will also provide a solid basis for a decision on capital enhancement measures to be considered by MMC and its two major shareholder groups.

*US dollar and euro amounts are translated from yen for convenience only at the rates of 107 yen/dollar and 134 yen/euro, the exchange rates prevailing on December 31, 2003.

Note on forward-looking statements
This document contains forward-looking statements about Mitsubishi Motors Corporation's plans, strategies, beliefs and performance that are not historical facts. These forward-looking statements are based on current expectations, estimates, forecasts and projections about the industries in which Mitsubishi Motors Corporation operates, management's beliefs, and assumptions made by management. As the expectations, estimates, forecasts and projections are subject to a number of risks, uncertainties and assumptions, they may cause actual results to differ materially from those projected. Mitsubishi Motors Corporation, therefore, wishes to caution readers not to place undue reliance on forward-looking statements. Furthermore, Mitsubishi Motors Corporation undertakes no obligation to update any forward-looking statements as a result of new information, future events or other developments.