Mitsubishi Motors Is Gearing Up to Finally Get Its Act Together
Poor Mitsubishi. Its strange history has ushered in memorable models, an important alliance with Chrysler, success on the World Rally stage, a partnership with Jackie Chan, an epic fuel economy scandal, and building debt that eventually turned it into the sad creature we know today. But there is nothing to say it has to stay mired in that ugly situation. It’s getting ready to crawl out of the dumpster and will be getting plenty of help along the way.
The Renault-Nissan Alliance, which now includes Mitsubishi Motors, announced a reformatting of its executive lineup on Thursday — adding new areas, such as quality and car servicing, where all three companies will work in tandem. Bent on efficiency savings, the Alliance said it will seek to extend its convergence in the areas of purchasing, engineering, manufacturing and supply chains next month (when Mitsubishi also gets its new CEO for North America). The ultimate goal here is to maximize profits that can then used for advanced research and development.
Where does this leave Mitsubishi? In a much better position than it once was. Despite initial concerns that Renault and Nissan would attempt to relegate the brand to Asia, where it’s strongest, the Alliance opted to improve the company’s U.S. dealership network and grow sales by 30 percent to 130,000 units per year.
That apparently does not mean stripping any of the brands of their identity, either. According to Reuters, Alliance chairman Carlos Ghosn said the key is to “turbo-charge the performance and growth of its member companies, while preserving the autonomy and distinct strategies of Renault, Nissan and Mitsubishi Motors.”
“The CEO of each company is in charge of its own business, that is the bottom line. This is not about change of responsibility, it’s about acceleration of the synergies that are not possible without working together,” Ghosn added. “Everything we are doing here is about efficiency.”
Mitsubishi may already be on the road to recovery. It has seen gradually improving sales in North America for the last five years. The brand’s stock valuation has also recovered since collapsing in April of 2016, after news of its 25-year-long fuel economy scandal broke. Mitsubishi Motors may still be a shadow of its former self, but something is starting to materialize as things improve. That doesn’t mean the Lancer Evolution is poised for a return next year, nor does it suggest its a big change in its lackluster North American lineup is right around the corner.
However, more money will eventually make those items a possibility. The Alliance has already unveiled a 2022 mid-term strategy targeting increasing annual “synergies” of more than 10 billion euros ($12.2 billion). That’s up from 5 billion ($6.1 billion) in 2016, when Nissan initially acquired a controlling interest Mitsubishi.
[Image: Mitsubishi Motors]
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