According to informed sources, Mitsubishi Electric Corp. will sell its automotive equipment business and plans to hold an open tender for the subsidiary.

The sources indicated that the company will accept first-round bids from potential buyers by January 26, with interested parties including other automotive parts suppliers and private equity funds. The individuals requested anonymity as the matter involves internal plans. One of the sources stated that this divestiture could generate a gain of 200 to 300 billion yen ($1.3 to $1.9 billion).

The automotive equipment business includes products such as inverters and motors for hybrid and electric vehicles, as well as in-car entertainment systems, all of which face intense cost competition. A slowdown in the global electric vehicle market has further intensified profitability challenges within the sector.

A representative for Mitsubishi Electric did not immediately comment.