QOTD: Total Eclipse of the Brand?
Is Mitsubishi about to try on Fiat’s shoes? After the Japanese automaker’s CEO presented a new business plan that aligns with the goals of its alliance bunk mates late last week, it’s starting to look that way.
The Mirage maker, suddenly eager to save cash and firm up its foundation, plans to pull back in the North American market, preferring instead to focus on Southeast Asia and other overseas environs. It’s not that the brand wasn’t growing its sales in the U.S. and Canada; it was. Its dealer network was steadily adding stores, too, and 2019 was the brand’s best sales year since 2007.
What we ask you today is: should “pulling back” turn into pulling out?
Mitsubishi CEO Takao Kato stated that the brand’s push for growth in N.A. hasn’t been as successful as it would have liked. A skimpy product lineup might have something to do about that — something scarce development dollars preceding its alliance entry didn’t help, and turmoil following didn’t, either. Two crossovers in the compact class, one of them ancient, and a midsize CUV that’s long in the tooth but admittedly offers a cost-effective plug-in hybrid option. Oh, and the subcompact Mirage, a passenger car that actually saw its annual sales volume rise in 2019. A rare feat.
Given the fact that all Mitsubishi products originate overseas (the company offloaded its sole U.S. assembly plant years ago), one wonders about the bargain basement Mirage’s profit margins.
In what seems now like a lifetime ago, Mitsubishi regularly sold more than 300,000 vehicles per year in the U.S.; that trend ended after 2002. Recall the lineup back then! Oh yeah… The brand’s volume subsequently sank to less than 40,000 units in the dismal year of 2009, rising to 57,790 in 2012, 96,267 in 2016, and a decade-long high of 121,046 units in 2019.
Kato’s words seem to indicate there’ll be no return to glory for the brand on thes shores. No (legit) resurrection of cool nameplates from years past. No sports car, no pickup, no reason to get excited. If new product is indeed slated for this market, Kato didn’t provide any indication of that. His words seemed to herald a wind-down of the brand’s operations above anything else. Unlike Fiat, which returned to North America only to immediately extinguish itself like a wet campfire, Mitsubishi showed some promise over the course of the 2010s, if sales numbers mean anything (this may not be your truth, as the kids say — your author just happens to reside near a remarkably healthy Mitsubishi market).
The brand might not be for everyone, but one could see the addition of new product helping its now former goal in North America. Alas, the pandemic and the whims of the alliance have forced its hand.
So, let’s play You Make The Call. Should Mitsubishi vacate North America, or try to soldier on with its current lineup, with prospective buyers wondering if their would-be ride belongs to a soon-dead brand?
HotPotato on Jun 24, 2020
If Mitsubishi can plug-in-hybridize all its CUVs...with power, range, and battery longevity comparable to the Toyota RAV-4 PHEV Prime but at a third less price -- then they can utterly own a niche with good growth potential, much like Subaru seeing the potential in AWD years ago. If not, then I don't see what their niche is. The Outlander PHEV is a good little rig but its development is perpetually five years behind. The Eclipse is way more desirable to me than a Trax, but that's a low bar. The Mirage is a boon to low-income buyers, but those are low-profit sales.
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