Japan’s Mitsubishi Electric said that it will stop manufacturing mobile telephones due to bleak outlook for the loss-making business, which is facing sturdy competition.

The fact is that Japan’s mobile telephone market has very limited potential for development as most of the people already have a cellphone and also the population is shrinking. Because of this Mitsubishi Electric’s mobile handset business suffered shipment decreases recently.

Mitsubishi expects its mobile phone sales in the current fiscal year to March to amount to 2.1 million handsets, worth a total of 100 billion yen (970 million dollars), mainly for leading Japanese carrier NTT DoCoMo.

The company said it was not planning any layoffs, with roughly 600 workers in the mobile phone business expected to be relocated to other operations. It will cost a loss of about 17 billion yen in the group’s pretax losses in the current fiscal year to March.

The company will transfer the resources to other areas having better potentials like communication infrastructure, home and business security systems, and factory automation systems.