AMSTERDAM – Mitsubishi Motors is making a major investment in new products to help its European revival.

The company is promising 12 all-new vehicles over the next four years as it bids for a 2% share of the European market, said Thomas Weigand, vice president sales and market management for Mitsubishi Motors Europe.

That means increasing sales from 213,000 last year and a 1.2% market share, to 300,00 by 2005.

First of those new models is the facelifted Space Star, built by NedCar in Born, Holland, and launched here this month.

Although only a facelift, the Space Star shows the fresh new face of Mitsubishi Motors, said Mr Weigand.

It is the company’s biggest selling European model, accounting for almost 30% of all sales.

It will be joined in 2004 by the Dutch-built NCC (New Compact Car) which has had strong input from Mitsubishi’s design centre in Trebur, near Frankfurt, Germany.

A four-door version of DaimlerChrysler’s Smart car will also start rolling off the NedCar lines at the same time when production of Carisma and Volvo S40 and V40 ends.

Engines for the two new models will be supplied from the new MDC (Mitsubishi Daimler Chrysler) engine plant in Germany. Initially these will be Mitsubishi-designed 1.1 and 1.3 litre petrol engines; diesel engines will join the MDC output later, said Mr Weigand.

The plant, due to come on stream in late 2003, will have annual production capacity of 300,000 engines.

Mitsubishi’s rebuilding in Europe will continue with the launch of the Airtrek – a crossover 4x4 SUV and estate -- next April.

The B-segment NCC will be launched as a five door with a three-door model arriving later.

Mitsubishi Motors Europe is not making a profit said Mr Weigand and the new management team was putting in place a revival plan based on three pillars to reverse it fortunes.

The first was to get the right product. This will include the continuing supply of the compact Pajero (Shogun) Pinin from Pininfarina in Italy. "We have a contract until 2005 with Pininfarina and we are looking at possibilities to continue beyond that," said Mr Weigand.

The second pillar was the reorganisation of Mitsubishi Motors Europe which has its headquarters in Amsterdam. "We want to make it more pan-European with Japanese staff in key functions like product planning to give us the right links between design and engineering here and in Japan."

Part of the shake-up will be to make the company more market-oriented. "We must have close links with our markets here," said Mr Weigand.

The third pillar of the plan was to reorganise distribution. "Our distribution costs are definitely too high and we want a cut of between 15% and 20% over the next two years."

Part of this will involve going to a build-to-order system at NedCar. There will also be more sharing of back-office functions within the DaimlerChrysler alliance although dealerships will remain independent.

The company will also switch to a pan-European advertising strategy as it tries to build brand awareness.

"We have a team evaluating the right brand positioning for us and we will decide on that early next year."

Mr Weigand put Mitsubishi’s current problems down to inconsistencies in the product replacement cycle.

"We must make sure our products are attractive," he said.

Although the L200 is currently Europe’s best-selling pick-up, there were no plans to build it in Europe.

Published : 21/06/02 Author : Melanie Carter

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