JAPANESE ELECTRONICS conglomerate Mitsubishi Electric said Monday that it's getting out of the mobile phone manufacturing business.

In a statement, the company claimed that Japan's cellphone market is saturated and the country's population is declining. It continued, " Consequently, Mitsubishi Electric's mobile handset business has recently suffered shipment decreases and it has become extremely difficult to expect an improvement in this field."

Mitsubishi reportedly has a relatively small share of Japan's 50 million handsets per year mobile phone market. The company expects to sell about 2.1 million handsets worth about 100 billion yen ($970 million) in its current fiscal year.

The company said it doesn't plan to lay off any of its 600 mobile phone workers but will reassign them to other operations instead. It further said that it will direct resources to other markets with better growth outlooks, such as communications infrastructure, security systems and factory automation equipment.

The move is but the latest instance of Japanese companies adjusting their stances in expectation of a recession in the US and other markets. Just weeks ago, Sanyo announced that it will sell its mobile phone manufacturing operation to Kyocera. Also, Toshiba recently gave up on its HD DVD format and Hitachi decided to get out of its PC manufacturing business. µ