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Mitsubishi Motors shares jump on electric car report

TOKYO (Reuters) - Mitsubishi Motors Corp 7211.T shares jumped 5 percent on Thursday after the Nikkei business daily said the company may start supplying France's PSA Peugeot Citroen Group PEUP.PA with electric cars from next year.

Japan’s fifth-largest carmaker may supply 10,000 i MiEV passenger cars a year to the French automaker by 2011 on an original equipment manufacturer (OEM) basis, the Nikkei added.

Mitsubishi Motors rose 5.0 percent to 146 yen, far outperforming the Topix subindex for transport equipment makers .ITEQP.T, which fell 1.1 percent, although a Mitsubishi Motors spokesman said no such decision had been reached yet.

“We are considering collaborating with PSA on electric cars as we said officially last June,” said company spokesman Fumio Nishizaki.

The plug-in vehicle, which is powered by a high-performance lithium ion battery, is due to debut in Japan in the summer.

It runs about 100 miles on a single charge.

Europe is expected to become a leading market for electric cars as governments rush to offer incentives.

The French government is providing subsidies of up to 5,000 euros ($6,800) as well as tax breaks for buyers of electric cars, the Nikkei noted.

For sales in Japan, Mitsubishi Motors currently aims to roll out 2,000 i MiEVs in the year to March 2010 and ramp that up to produce about 10,000 units in the year to March 2012.

The i MiEV is expected to be priced at less than 3 million yen ($32,410) after government subsidies, the company spokesman said.

Mitsubishi Motors rival Nissan Motor Co 7201.T is developing electric vehicles with French partner Renault SA RENA.PA.

($1=92.56 Yen)

Reporting by Yumiko Nishitani; Editing by Hugh Lawson

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