Mitsubishi comes back to life

Mitsubishi Australia is citing record sales as proof there is life beyond local manufacturing.

Mitsubishi’s June 2013 result of 9257 sales is its best month as an importer and its second best ever. The six-month sales result for January-June 2013 of 37,329 is also its best import result ever.

The company, which shut down its Adelaide manufacturing plant in 2008 and now presents itself as a ‘value’ brand, is aiming to grow sales from 58,868 in 2012 to 70,000 in 2103 and on to a record 100,000 by 2017.

“We were a manufacturer for a very long time and structurally it is easy to say we go from this many people to this many people. That’s a physical act. But you need a cultural and mental act too,” explained Mitsubishi Australia Marketing Director Tony Principe.

“It’s not an easy process.”

Principe, speaking at this week’s local launch of the ASX diesel auto, said keys to turning around Mitsubishi’s Australian fortunes were becoming less Adelaide-centric and providing the dealer network with better and more stable financial incentives to move metal.

He admitted dealers were sceptical when first presented with the goal of 100,000 sales by 2017 at conferences last April.

“They weren’t too complementary. The dealers are very cynical people by nature so you have got to make it happen first. We have had people through April and May say ‘you are all crazy’, now in June they are saying maybe we are not crazy.”

“They are the ones who have to sell the cars. We could do whatever we like. They have to believe and that has not been easy to do. In this last three months we are at record levels and the number of dealers who have hit record levels is huge.

“So we have a lot of dealers who are now understanding we are serious. I think in the past there was a feeling we talked a lot but maybe nothing much happened.”

Principe said the fundamental change in approach to dealers boiled down to matching the incentives provided by other brands they sold.

“They are all multi-franchise, so any given set of dealers, they are selling your product, Nissan product, Toyota product; so how do you get your fair share of voice in that environment?

“The problem was we weren’t matching what the competitors were offering … like giving the right kind of incentive such as saying ‘if you sell this car in this volume we are happy to provide bonusing that gives you certainty’. The reality is this stuff is not brain surgery.

“One of the problems was we weren’t consistent. We’d do something for a month and then we’d stop, and then maybe two months later we might start it up again. They had no certainty.”

Much of the change, which also includes a fundamental management restructure, has come since the appointment of veteran Mutsuhiro Oshikiri to the position of CEO in 2012. Soon after he arrived he declared: “We have to change the company or we will not survive.”

“One of the historical factors for us was we were very centralised because we were in manufacturing and everything revolved around Adelaide,” Principe said.

“What Oshikiri has done is say ‘OK, sales happen over there in Sydney, Melbourne and Brisbane. We need to make them the centre of our being, not just be sitting over here in Adelaide’.”

Oshikiri’s sweeping changes have seen a group of long-term Mitsubishi Australia senior executives depart the company. His management team now consists of five directors managing four key areas – sales, after-sales, marketing and corporate services.

Oshikiri had been scheduled to be at the ASX launch to discuss Mitsubishi Australia’s improving performance and restructure with the media but was instead called away to meetings in Japan.

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