Mitsubishi Motors is said to be planning to offer early retirement to some 500 to 600 workers in mid November as part of plans to cut costs and restructure its operations, according to local reports citing sources close to the matter.

The company is said to be planning to offer early retirement to staff over the age of 45, including white collar staff at its Tokyo headquarters and workers at its factories in Aichi and Okayama prefectures, according to the sources.

Its total workforce at the end of March was around 14,000 people.

The Japanese automaker is struggling with falling sales due to the global COVID-19 pandemic. Its global vehicle output in the first eight months of 2020 fell by over 59% year on year to 534,241 units, with output in Japan down by over 61% at 249,052 units.

As part of its mid term business plan announced in July, Mitsubishi Motors aims to reduce its global labour costs by more than 20% to help improve its financial performance.

The company is expected to incur a net loss of JPY360bn (US$3.4bn) in the current fiscal year ending 31 March 2021.

The new business plan calls for more resources to be concentrated in south east Asia, where costs are lower, and make greater use of potential production synergies in this region with alliance partner Nissan Motor.

Earlier this year the carmaker announced it would halt production of its iconic Pajero SUV and its i-MiEV compact electric vehicle, and close its Sakahogi plant in Japan's Gifu Prefecture run by the Pajero Manufacturing Company subsidiary.