MOSES LAKE – Mitsubishi Aircraft told local employees on Thursday that the company was postponing production of its SpaceJet M100 passenger plane and closing its U.S. operations, according to an email from a company spokesperson.

Jeff Dronen, director of strategic communications for Mitsubishi Aircraft, said in an email to the Columbia Basin Herald that the upcoming annual budget for Mitsubishi Heavy Industries – Mitsubishi Aircraft’s parent company – was significantly reduced.

Mitsubishi Heavy Industries on May 11 announced a loss of $2.5 billion (263.3 billion Japanese yen) on SpaceJet development in fiscal 2019, more than three times the previous year’s loss. Overall, the company’s aerospace and defense unit – of which Mitsubishi Aircraft is a part – posted a 2019 loss of $1.9 billion (209 billion yen).

“Since the announcement on May 11, company leadership has been assessing the financial impact to the company and its entire global operations,” Dronen wrote. “As a result, the company has had to make difficult decisions that will significantly reduce its global activities and will have a major impact on its organization.”

According to a report by Kyodo News, Mitsubishi Aircraft more than halved the SpaceJet project’s 2020 budget to $560 million from last year’s $1.3 billion. The company appears to remain committed to the longer, M90 version of the SpaceJet, which has orders from regional airlines in the U.S., Japan and Sweden.

Dronen said it was reducing its flight operations in Moses Lake to a “minimal staff who will focus on maintaining and preserving the aircraft.”

“All other overseas locations will close and Mitsubishi Aircraft will consolidate remaining activities at its headquarters in Nagoya, Japan,” Dronen wrote.

“The Port of Moses Lake is obviously disappointed to learn of Mitsubishi’s decision to curtail operations at the Grant County International Airport for the immediate future,” wrote Port of Moses Lake Executive Director Don Kersey in a text message to the CBH.

“Mitsubishi is a valued tenant of the Port of Moses Lake community,” he said. “The port will continue to provide support and assistance to Mitsubishi during this period and looks forward to seeing their aircraft flying again in the future.”

The SpaceJet is the first Japanese-produced commercial aircraft since the 1960s. The program has been plagued with design and production issues since its inception, with the first M90 models slated for delivery to All-Nippon Airways in April 2021.