The Mitsubishi Outlander PHEV is among the few new models coming anytime soon.
Mitsubishi Motors has named a new chairman for its struggling U.S. subsidiary, the first time that post has been filled since 2007 when the Japanese-owned maker was struggling for survival.
With 35 years in at the maker, Gayu Uesugi appears to carry the credentials needed in his new post, having worked at Mitsubishi’s Japanese headquarters overseeing product strategy and development and cost control. The maker let costs run out of control over the past decade – in part with an ill-conceived marketing strategy that saw thousands of young buyers get a year’s free use of Mitsubishi products before handing the keys back to the company.
With its U.S. market share at less than a half percent, analysts warn that Mitsubishi cannot long sustain a presence in the States without a major breakthrough. The alternative would be to follow the example set by American Suzuki which has declared bankruptcy and will now stop selling cars in the U.S. market.
But how long it might take for a turnaround is uncertain. And industry analysts question whether Mitsubishi has the right ammo to survive the increasingly tough fight in the American marketplace.
The maker has generated only moderate enthusiasm for new products such as the i-MiEV electric vehicle, Lancer sedan and Outlander. Its most recent update of the Eclipse sports coupe yielded disastrous results – leading to the 2011 decision to kill off or completely replace Mitsubishi’s entire American line-up.
The new entries coming to the States over the next several years – including the new Outlander PHEV plug-in Hybrid and updated Lancer – are not expected to generate major volume increases.
So, Uesugi will have his work cut out for him as he tries to piece together a functional business strategy.
“As the Chairman of MMNA, Uesugi’s new role will include leadership in developing a product plan and growth strategy for the U.S. market,” explained the new executive’s boss, Mitsubishi Motors President Osamu Masuko.
Growth hasn’t been a word much associated with Mitsubishi in recent years. From a U.S. peak of 345,000, volume fell to a low of around 50,000 during the depths of the recession, rebounding moderately last year to just under 80,000. Last month, Mitsubishi was one of the only makers to see a decline in U.S. sales, volume falling 9.1%.
Only a few years ago, the parent company was struggling for survival – rescued by a multi-bank bailout in Japan. That collapse was triggered, in part, by a flawed U.S. marketing strategy, Mitsubishi launching a so-called NINJA loan program – short for No Income, No Jobs or Assets – aimed at bringing in young buyers who would fuel the brand’s long-term growth. But the program proved to be little more than a short-term free loan as a significant number of those young customers took advantage of a year of driving without having to make payments before defaulting and turning back the vehicle.
Complicating matters, a decades-old alliance with Chrysler collapsed as the U.S. maker entered bankruptcy in 2009.
Mitsubishi insists it is determined to turn things around in the U.S., but that was the same position taken by Suzuki which will stop selling automobiles in the States and now focus solely on motorcycles, ATVs and other smaller motorized products.
(For more on Suzuki’s plan to abandon the U.S. auto market, Click Here.)