NAGOYA (Kyodo) -- Mitsubishi Aircraft Corp. logged a record loss of 526.9 billion yen ($4.89 billion) in the fiscal year ended March due to costs related to the long-delayed development of Japan's first passenger jet, its earnings report on the government gazette showed Wednesday.
The aircraft-making subsidiary of Mitsubishi Heavy Industries Ltd. incurred 464.6 billion yen in excess liabilities, falling into negative net worth for the first time in two years. In fiscal 2018, it posted a net profit of 2.3 billion yen, thanks to a capital injection of some 220 billion yen by the parent company.
"We are covering necessary expenses through loans from Mitsubishi Heavy and there is no trouble continuing business," a Mitsubishi Aircraft spokesperson said, adding the company will continue with the development of the small aircraft known as the Mitsubishi SpaceJet.
The jet, previously known as the Mitsubishi Regional Jet, saw its initial delivery to All Nippon Airways Co., originally planned for 2013, postponed six times to 2021 or later due to problems with parts.
Mitsubishi Aircraft said last month it will downsize and reshuffle the team developing the jet in the face of plunging air travel demand due to the novel coronavirus pandemic, a move that could further delay the aircraft's launch.
It will cut more than half of its 2,000 workforce and close all its overseas bases except for the company's flight-test site in the state of Washington, a company source said.
Mitsubishi Heavy has said it will reduce SpaceJet development costs by more than half to 60 billion yen in the current fiscal year through next March.