The number-four Japanese carmaker is considering reducing its output in the business year to March 2009 by about 120,000 units, Jiji Press reported.

In late October, Mitsubishi had revised downward its annual sales estimate by 81,000 to 1,228,000 units and subsequently cut the production target by 80,000 units as the global sales slump spread to emerging markets.

In line with the further cutback in output, Mitsubishi is expected to end contracts with 1,000 temporary employees at its five group plants at home, Jiji and Kyodo News reported.

There are currently 3,350 temporary workers at the plants.

Other Japanese carmakers have announced downsizing plans in the past week.

The industry leader, Toyota Motor Corp., said it planned to halve its temporary workforce to 3,000 jobs in the year to March 2009.

Honda, the country's number-two carmaker, said it would cut its production in the business year by 79,000 vehicles from an earlier target to cope with falling sales. It expects to produce 1.278 million units at its domestic plants in the year, down one percent from last year.

Mazda, Japan's fifth largest carmaker, also said it would scrap 1,300 temporary jobs, while Isuzu said it would axe 1,400 domestic posts.

Nissan Motor, ranked third at home, decided to cut production and axe 3,500 jobs worldwide. -- AFP