Ext User(Dan---)
27-04-2006, 12:13 PM
http://www.theage.com.au/news/business/mitsubishi-acts-to-remedy-380-botch/2006/04/26/1145861419618.html
Mitsubishi acts to remedy 380 botch
By Ian Porter
April 27, 2006
MITSUBISHI Australia is expected to reveal plans to relaunch its
make-or-break 380 model after sales in the model's first few months missed
their target by a wide margin.
Chief executive Rob McEniry will reveal the plans at a news conference this
morning in a move designed to quell fears of a permanent plant closure.
The 380 cost $600 million to bring to market, and the troubled Japanese
group is anxious to see some sort of return on the investment, which was
approved before the parent company itself plunged into its massive
restructuring program in 2004.
The relaunch is seen as the last chance for the local arm to recoup the
investment and keep the Tonsley Park assembly plant in Adelaide operating.
The imported vehicles in the range, especially the commercial vehicles, are
continuing to sell well.
"They are aware at Mitsubishi that they mucked up the launch of the 380 and
are going to do it again with some minor facelifts," one industry insider
said yesterday.
The 380 was launched late last year when the market for large six-cylinder
cars was in turmoil.
Demand was falling due to a combination of surging petrol prices and the
availability of a number of attractive smaller cars, many of which cost more
than the six-cylinder cars to buy.
Holden, Ford and Toyota all had excess six-cylinder inventory on their hands
and discounting was fierce among the locally made models, making it hard for
the 380 to make an impression.
Another factor in the 380's poor reception was the lack of differentiation
between the five models in the range, said the insider, who asked not to be
named. "It was hard to tell the difference between the models, and the price
points were all wrong, too."
Mitsubishi tacitly admitted the price-points problem when it hastily pulled
together a new base-level model called the LE over January, ready for
release at the Melbourne International Motor Show.
That model sold for $29,990 and was pitched well below the original base
model 380, which was priced at $34,490 for the manual transmission version.
Only 1000 LEs were scheduled for production.
The LE helped perk up sales in February and March, but sales were still well
below target, forcing Mitsubishi to shut the plant for three weeks in March
in order to prevent inventory blowing out of control.
The production line has been reconfigured to make between 75 and 115 cars a
day. Sales in March tallied about 50 a day, according to the Vfacts
registration figures.
While the company is believed to be losing money at these levels, the
balance sheet was made much leaner early last year when the group was
restructured by the parent company.
Mitsubishi Australia was recapitalised with a cash injection of $540
million.
KEY POINTS
?Relaunch is seen as the last chance to recoup investment.
?Rivals greet the 380 with fierce competition.
?Mitsubishi mucked up the launch, says an insider.
MITSUBISHI 380 vs MAGNA
Magna 380
Sales last year
Jan 1023
Feb 1782
Mar 1523
Apr 699
May 1071
Jun 1487
Jul 1710
Aug 1351
Sep 1010
Oct 339 951
Nov 218 1650
Dec 256 947
Sales this year
Jan 96 719
Feb 100 1011
Mar 148 1210
--
Regards
Dan
Mitsubishi acts to remedy 380 botch
By Ian Porter
April 27, 2006
MITSUBISHI Australia is expected to reveal plans to relaunch its
make-or-break 380 model after sales in the model's first few months missed
their target by a wide margin.
Chief executive Rob McEniry will reveal the plans at a news conference this
morning in a move designed to quell fears of a permanent plant closure.
The 380 cost $600 million to bring to market, and the troubled Japanese
group is anxious to see some sort of return on the investment, which was
approved before the parent company itself plunged into its massive
restructuring program in 2004.
The relaunch is seen as the last chance for the local arm to recoup the
investment and keep the Tonsley Park assembly plant in Adelaide operating.
The imported vehicles in the range, especially the commercial vehicles, are
continuing to sell well.
"They are aware at Mitsubishi that they mucked up the launch of the 380 and
are going to do it again with some minor facelifts," one industry insider
said yesterday.
The 380 was launched late last year when the market for large six-cylinder
cars was in turmoil.
Demand was falling due to a combination of surging petrol prices and the
availability of a number of attractive smaller cars, many of which cost more
than the six-cylinder cars to buy.
Holden, Ford and Toyota all had excess six-cylinder inventory on their hands
and discounting was fierce among the locally made models, making it hard for
the 380 to make an impression.
Another factor in the 380's poor reception was the lack of differentiation
between the five models in the range, said the insider, who asked not to be
named. "It was hard to tell the difference between the models, and the price
points were all wrong, too."
Mitsubishi tacitly admitted the price-points problem when it hastily pulled
together a new base-level model called the LE over January, ready for
release at the Melbourne International Motor Show.
That model sold for $29,990 and was pitched well below the original base
model 380, which was priced at $34,490 for the manual transmission version.
Only 1000 LEs were scheduled for production.
The LE helped perk up sales in February and March, but sales were still well
below target, forcing Mitsubishi to shut the plant for three weeks in March
in order to prevent inventory blowing out of control.
The production line has been reconfigured to make between 75 and 115 cars a
day. Sales in March tallied about 50 a day, according to the Vfacts
registration figures.
While the company is believed to be losing money at these levels, the
balance sheet was made much leaner early last year when the group was
restructured by the parent company.
Mitsubishi Australia was recapitalised with a cash injection of $540
million.
KEY POINTS
?Relaunch is seen as the last chance to recoup investment.
?Rivals greet the 380 with fierce competition.
?Mitsubishi mucked up the launch, says an insider.
MITSUBISHI 380 vs MAGNA
Magna 380
Sales last year
Jan 1023
Feb 1782
Mar 1523
Apr 699
May 1071
Jun 1487
Jul 1710
Aug 1351
Sep 1010
Oct 339 951
Nov 218 1650
Dec 256 947
Sales this year
Jan 96 719
Feb 100 1011
Mar 148 1210
--
Regards
Dan