Here in the United States, Mitsubishi is still in the process of transforming its business model, with the aim of boosting profits as one of the arms of the Nissan-Renault-Mitsubishi alliance. However, as the brand’s sales haven’t been as strong as other automakers and it captures more of markets like southeast Asia, CEO Takao Kato said the company would focus more on core models and markets at a recent shareholders meeting.
Automotive News points out Kato’s mention of volume and profits in North America during that meeting. The region is one of the brand’s “megamarkets”, with others being Europe and China. “Even though we increased sales volume in the megamarkets, we have not yet achieved the level of profit we expected. We aim to increase sales in the regions where we can offer our core products. We will gradually reduce our commitment to megamarkets (emphasis added).”
Mitsubishi’s last plan, called the “Drive for Growth” had a different emphasis, focusing on markets like North America to boost volume, and in turn generate higher profits. While its U.S. sales volume did increase 2.5 percent in 2019 to 121,046 units, March 2020 year-to-date sales fell 15.5 percent due to the growing coronavirus pandemic. That month comprises the last available sales figures, as the Japanese automaker transitioned to quarterly reporting beginning July 1.
Moving forward, the automaker plans to reinforce its tactics to boost sales in Southeast Asia and Oceania, where it carries stronger sales. As part of the alliance among the three automakers, Renault will spearhead the efforts to boost profits in Europe. For its part, Nissan will do the same in North America. To be clear, this does not signal that Mitsubishi will pull out of the United States at any point in the near future, especially as it just relocated its headquarters to Franklin, Tennessee.
Just last week, the company announced it completed construction on its new permanent headquarters, with plans to phase in employees contingent upon how the coronavirus case load shifts in the coming weeks. Instead, AutoNews’ report suggests the company will shift its priorities away from volume in the so-called “megamarkets” to those where interest in its core volumes, including small cars, crossovers, trucks and vans is stronger.
Since Kato did not directly emphasize the U.S., we will have to wait and see how this plays out in the coming months.