Mitsubishi Motors is set to reduce its sedan lineup from three models to two and shift resources to minivans and other popular vehicles, Reuters said, citing the Nihon Keizai Shimbun business newspaper.

According to Reuters, a company spokesman said on Monday that a reduction of its sedan line was one option being discussed under the automaker's plan to concentrate its limited resources on more successful models, but added that nothing had been finalised.

"That (possibility) has been brought to the discussion table, but it is just one of many options," the spokesman reportedly said. "We hope to have a final decision around the summer."

Reuters noted that, in a bid to slash sales and development costs in the face of sluggish domestic revenues, Japan's fourth-biggest car maker has said it would reduce its model lineup. The sedan segment is one of the weakest areas for the company, which is relatively strong in sport-utility vehicles.

According to Reuters, the Nihon Keizai said on Sunday that Mitsubishi, owned 37% by DaimlerChrysler AG, planned to integrate its Diamante and Galant sedan lines into a new vehicle by 2005. Sales of the 2.5-litre Diamante and the two-litre Galant have been weak, totalling fewer than 1,000 a month, the paper reportedly said.

Reuters said that securing solid sales in Japan has become increasingly crucial for Mitsubishi since its sales in the United States, the company's most important market, have been sliding recently despite bigger spending on incentives.

Mitsubishi's passenger car sales in Japan fell 12% last business year as the automaker concentrated on restructuring after a crippling recall scandal three years ago, Reuters added.

Apart from reducing the number of models in Japan, Mitsubishi aims to strengthen its domestic sales through value-added features, such as the built-to-order method first introduced in the popular Colt subcompact in November, Reuters noted.

According to the news agency, senior vice president Eiji Iwakuni, who oversees domestic sales and marketing, also told a small group of reporters earlier this month that the automaker may eventually develop a car aimed specifically at boosting the company's image, which has been tarnished by the recall of nearly two million cars in 2000.

President Rolf Eckrodt said in an interview last week he expected Mitsubishi's domestic sales to jump 13% in the business year to next March, Reuters added.

In a promising sign for domestic sales, the automaker said on Monday sales of the new Grandis minivan, launched at the weekend, had hit 5,018 units in the first two days, far above the 3,000 units targeted on a monthly basis, Reuters said.

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