Mitsubishi Oz hoping for small car from Nissan

Mitsubishi Motors Australia has expressed confidence that Renault-Nissan's effective takeover of its parent company will have positive outcomes for the brand's vehicle line-up in Australia.

Speaking at an off-road drive event in the Flinders Ranges this week, MMAL's Executive Director of Marketing, Tony Principe, said he expected the alliance with Renault-Nissan would put Mitsubishi Australia in a stronger position over the next few years.

"We expect to be able to deliver higher-quality, lower-cost products and services, and new technologies should be available much more quickly and at a lower cost base," he said.

Echoing comments made by Hiroto Saikawa, the newly installed co-CEO of Nissan, which now controls Mitsubishi Motors Corporation, Principe indicated there were significant opportunities to share existing models and development of future models.

He said that the alliance might be an opportunity to renew Mitsubishi's ageing Lancer small car offering locally, however, the brand's focus remains on maximising sales of its growing SUV portfolio.

"Getting a small car would be a bonus but we don't know what they're thinking. I guess one's hopeful that a small car will pop out somewhere but it's not something that's going to determine what we do."

Globally, Mitsubishi has been focused on developing its SUV range, both to meet customer demand and drive profitability for the company as SUVs command higher price points than small cars.

In Australia, the strategy appears to be paying off, with sales of the company's SUVs growing 34 per cent year to date against overall SUV market growth of 9.9 per cent.

As the Australian domestic market moves rapidly towards another potential record market of 1.2 million units, Mitsubishi forecasts SUV sales are expected to reach close to 475,000 units in 2016 – potentially outselling conventional passenger cars for the first time ever.

While it is far from the newest small SUV on the block, sales of its entry-level ASX are up 45 per cent year to date, while sales of the range-topping Pajero Sport are running at double those of the Challenger it replaced.

"The Pajero Sport is the icing on the cake," said Principe.

"It's what the Challenger should have been. When we launched the Challenger and did all the clinics, the styling researched really well but everyone that came in and looked at it… well….unfortunately that older 2.5 diesel wasn't anywhere near as smooth as this new engine and transmission.

"We thought to ourselves, we're close to having a market leader here but once they drove it they told is it wasn't quite what they were looking for."

Principe added that in addition to driveline improvements, the Pajero Sport had been positioned to promise better value for money for budget-focused buyers within the segment who may be cross-shopping with soft-roaders.

He said adding car-like features such as safety and seat comfort were key factors for buyers of large SUVs, but that the Pajero Sport's four-wheel drive capability and towing capacity offered extra flexibility.

"That market is pretty tough," said Principe. "The seven-seat capability will add to its appeal but never underestimate the power of value for money. Our price range puts us right in the mix."