Mitsubishi looks to rebound

[PontiacJ8]

Ailing Mitsubishi Motors Corp. is banking on several core models, fewer dealers, a boost in retail sales rather than fleet customers and tighter credit controls to nurse the automaker back to financial health, the company’s top U.S. executive said Tuesday.

Hitting rock bottom has forced the Japanese automaker to clean up its balance sheet and adopt a realistic strategy for a comeback, the new chief of Mitsubishi’s U.S. operations said Tuesday.

“The past is the past and there’s not a thing I can do about it,” Finbarr O’Neill, head of Mitsubishi Motors North America, said in an interview. “The question is, what can we do about the future?”

Since joining Mitsubishi in September 2003 from up-and-coming Korean carmaker Hyundai’s U.S. division, O’Neill has cleaned house at a company in the midst of a dramatic downward spiral.

Mitsubishi sold almost 350,000 vehicles in the U.S. market in 2002, but the automaker will struggle to sell 200,000 units this year.

Gone are the generous “zero-zero-zero” financing terms that lured consumers with bad credit, and the practice of dumping slow-selling vehicles into rental fleets.

Mitsubishi is also attacking operating costs by cutting 1,200 jobs at its assembly plant in Normal, Ill., and scaling back its corporate payroll.

With its U.S. market share hovering at a scant 1 percent, Mitsubishi can hardly afford half-measures to stage a turnaround.

“We more or less have reached the bottom,” O’Neill said. “And if that’s where the bottom is, let’s get the costs adjusted so when we have new product we can be profitable.”

The Tokyo-based automaker lost $492 million during the latest fiscal quarter, and sales have dropped sharply in its home Japanese market.

Japanese sales plummeted after the automaker admitted earlier this year that it continued to hide auto defects to avert recalls, even though senior executives vowed to end a systematic cover-up when a similar scandal surfaced four years ago.

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[The Oatman]

Current day Mitsubishi for the most part makes awful little cars that make everyone else look good.

[PaleGreen]

With a little pruning of their product line, I think Mitsu can bounce back just fine. Once the Montero, Montero Sport, & Diamante are gone, things should start to improve. They're already offering a great warranty of 5/60 bumper to bumper & 10/100 powertrain. (Also includes 3/45 free scheduled maint.)

Their core products are pretty solid:

Small sedan & wagon - Lancer
Midsize sedan - Galant
Sporty coupe - Eclipse
Small SUV - Outlander
Midsize SUV - Endeavor
Halo car - Lancer Evolution

Believe me - I'd love to see Saturn with that kind of lineup!

[Smaart Aas Saabr]

I feel bad for Mitsubishi.

I hope they are able to get themselves back on track, especially since the new Galant is quite a nice car, if they put a stick with the V6 I'd take it over an Altima anyday.

[stewacide]

I agree - Mitsu's core products are very nice. The Gallant and Endevour especially should be doing a lot better than they are. Right now I think their best hope is to perfect the quality on those products and take Hyundai and Kia head-on in the super-warrenty game, but with better cars and an established Japanese nameplate.

[Swahili]

I feel bad for Mitsubishi.

So do I. Of the people that I know that own them, all have been happy except for one, and that wasn't the car's fault. A friend of mines b/f had an Eclipse and wasn't too impressed with the off the line performance, but he had been spoiled with some pretty fast cars before he owned that one.

Gone are the generous “zero-zero-zero” financing terms that lured consumers with bad credit, and the practice of dumping slow-selling vehicles into rental fleets.

I have never understood why any manufacturer would do this. I understand people need a break sometimes, but if a lot of your business is based on customers with bad credit (I don't recall too many other companies other than Mitsu doing this) then you're going to run into problems.

[ibechip]

I think the Eclipse is a fairly decent sport compact. It's not a road-ripping machine but for it's price, it's a nice car. The Evo definately is huge for Mitsubishi. The Galant is a beautiful car as well. Not a huge fan of any Mitsu SUV's but I guess every automaker is going that way lately. If they spruced up their car lineup a bit and cut down on the beaurocracy, they could do fairly well.

[akumaknight]

I think they need to revive the 3000GT and make it compete with the likes the of Corvette and Vipre. Every company needs a balls to the wall 2 seat street legal race car

[Nocturn_Bird]

A the 3000gt Was a 4 seater, B in its day it was priced to compete with the Vette and often did. C, Mitsu has NO platofrms on which to build the car, or engines they can easily drop in. D, it would steal some of the EVO's thunder and the point of that would be redundant to them bringing the EVO over in the first place.

But all that aside I agree, they need a new halo car that doesnt share the same lines as a family sedan. They need a corvette and need it as fast as we got the GTO.

[stewacide]

They need an AWD Eclipse is what they need, and it looks like they may actually get it.

[akumaknight]

I know the 3000 was a 4 seater, but have you ever tried to sit in the back of one? I'd rather be strapped to the hood.

I thought the evo was just a really hyped ralley car..