Mitsubishi pulls out of UK and Europe

[J.E]

Who knew that having an outdated noncompetitive line-up could cause a massive drop in sales? Imagine my shock.

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[Deleted member 1071]

...and to recall how popular the Colt, Galant, Eclipse and Pajero were here in Germany in the 1980s' and 1990s'.

 

[Giannis]

Updated: Mitsubishi freezes introduction of new models for Europe

Firm shifts focus to more profitable South-East Asia, suggesting gradual withdrawal from Europe

Mitsubishi has halted new model launches in Europe as part of an overhaul of its global operations to cut costs, which is expected to mark the beginning of the brand's withdrawal from the European market.

Under the 'Small but Beautiful' banner, the Japanese manufacturer plans to reduce its fixed costs by 20% over the next two years. It will shift to a business structure centred on Asia and "improve operating profit by downsizing low-profit businesses”.

The firm will focus its resources on the South-East Asian market, where it currently has a 6.4% market share, compared with just 1.0% in Europe and 0.9% in North America. Its operating profit in the region last year was 63.6 billion yen (£469.6 million), compared to just 12.8bn yen (£94.5m) across all other global markets.

A planned “freezing of the introduction of new products in Europe” means upcoming models such as the next-generation L200 pick-up truck, Outlander SUV and Mirage supermini are unlikely to be sold here.

Car Dealer Magazine reports that Mitsubishi UK boss Rob Lindley was surprised to hear the news, but that the Colt Car Company - sole distributor of the brand’s models in the country - will now "accelerate" talks it was already having with other manufacturers.

"We did not expect [Mitsubishi] to cease development of models for Europe completely and that was a shock," Lindley told Car Dealer, "but we were talking to other brands that are not yet represented here in the UK yet."

It is not yet known which brands are in line to fill the gap left by Mitsubishi's departure, but Lindley hinted that "if a brand is importing cars to Australia then they are a good fit for the UK as they are right-hand drive and crash tested to similar standards". It is suggested he is referring to top-selling Chinese brand Haval, which announced plans for a global rollout in 2017.

A Mitsubishi UK spokesman was unable to say for how long the European new model freeze will last but said that the situation is “evolving and changing rapidly”.

Mitsubishi plans to achieve “sustainable growth” from the end of 2022 by consolidating investment into core regions and products. Changes in its home market include shifting production of its Pajero SUV from Sakahogi to Okazaki, closing unproductive dealerships and promoting its sharing and subscription business.

The spokesman told Autocar that it's too early to say what the plans mean for Mitsubishi's 114 UK dealerships but that they're “still selling cars for the foreseeable future” and plan to continue to support customers with an ongoing aftersales parts and servicing offering.

However, the new model freeze means current models will not be replaced when they become non-compliant with EU emissions regulations, suggesting Mitsubishi will gradually withdraw from the European market.

Takao Kato, representative executive officer and CEO of the Mitsubishi Motors Corporation, said: “We will shift our strategy from all-round expansion to selection and concentration. First of all, we will complete our structural reforms and further strengthen our competitive areas – ultimately to build a corporate structure that can surely generate profits during this mid-term period." Further details on what this means for the struggling Renault-Nissan-Mitsubishi Alliance are unclear, but Mitsubishi has confirmed plans to continue introducing “cutting-edge models leveraging the Alliance partners’ technologies”. As part of its future models preview, the firm listed an electric kei car that it's co-developing with Nissan for launch after 2022.

Recently announced plans for the three Alliance brands to increase their sharing of technology and production are estimated to cut model development costs by up to 40%. As part of the revised structure, Renault has been named the lead brand in Europe, with Nissan taking the lead in Japan, North America and China and Mitsubishi the focus for South-East Asia and Oceania.

Nissan will continue to sell a limited number of successful models in Europe, but such a move would be less beneficial for Mitsubishi, given its smaller size.

Source: Autocar.co.uk

 

[Giannis]

With a line-up that consists of only the ASX, the Outlander PHEV, the Eclipse Cross, the Space Star and the L200, with the only competitive one being the L200, it's not surprise. At the same time it's sad to see the makers of the once great Evo's go out like this.

Strange times we're living in!

 

[Centurion]

Next manufacturer to pull out of the UK or Europe: Lexus, Suzuki and Subaru.

 

[Levi68]

Next manufacturer to pull out of the UK or Europe: Lexus,...

Lexus has never sold as much in Europe. Well, now they sell FWD rebadged Toyota's, but it looks like there is a market for those.

 

[A.P.]

Oh no! What will all the old people in Norway do now?

I wonder when they will announce their bankruptcy, because they aren't doing impressive numbers even in Asia. Pulling out of UK and EU is just the start of their downfall.

 

[MrRapp]

...and to recall how popular the Colt, Galant, Eclipse and Pajero were here in Germany in the 1980s' and 1990s'.

Actually was a Mitsubishi dealership close to my birthplace where I got fascinated by cars in the late 70's. Not much later my dad took me to pick up his first brand new car, a Galant, a magical moment for me of which I still have fond memories.

 

[Matski]

Next manufacturer to pull out of the UK or Europe: Lexus,...

As far as the UK goes, Subaru, it's right down there with Alfa Romeo... still better than the likes of Infiniti, but still only in the low hundreds per month. Lexus does a bit better, that's cracking the 1000 cars per month threshold, though all of the afore mentioned brands do less than Mitsubishi were. Suzuki does alright surprisingly enough, double what Mitsubishi did, they're on about par with Mazda and Fiat I believe.

 

[Centurion]

As far as the UK goes, Subaru, it's right down there with...

There is a big difference between doing alright and thriving. The former is unsustainable.

Electrification will do accelerate either of the following:
1. Consolidation
2. Demise
3. White labelling e.g a few players supplying drivetrains or other components to struggling players.

 

[Matski]

There is a big difference between doing alright and thriving. The former is unsustainable.

If you set the bar for sustainability at Suzuki's level we'd be set to lose more than just them, Lexus and Subaru.

 

[J.E]

The Japanese car industry is run by bean counters who can't be bothered about innovation.

 

[Rolf]

The Japanese car industry is run by bean counters who can't...

Toyota and Lexus were some of the first car makers that pushed Hybrid drivetrains but now they been using the same engines in both Prius and Lexus models for last 10 years or so and hardly increased the power even on the electric motors and don’t have any electric models. Lexus has lost its innovation and it can be seen again with the Powertrains in the new IS. The Chinese car makers are making bigger strides with electric powertrains than the Japanese car makers now

 

[Centurion]

The Japanese car industry is run by bean counters who can't...

In the west, the biggest enemy of Japanese manufacturers has been the German manufacturers going downmarket.

On finance the difference between a premium Toyota/Honda and an X1, A-Class or Q3 is minimal. The German cars offer better cabin quality, engines, fit and finish, and in some cases much more superior resale value.

 

[J.E]

Toyota and Lexus were some of the first car makers that pushed Hybrid drivetrains but now they been using the same engines in both Prius and Lexus models for last 10 years or so and hardly increased the power even on the electric motors and don’t have any electric models. Lexus has lost its innovation and it can be seen again with the Powertrains in the new IS. The Chinese car makers are making bigger strides with electric powertrains than the Japanese car makers now

Toyota and Lexus still use the same old tired V6 from 2005. And in their stubbornness, they decided that doubling the number of fuel injectors is better than turbocharging...