Price push for Outlander PHEV

A pallid buyer response to Australia’s first plug-in SUV, the Outlander PHEV, has prompted Mitsubishi Motors Australia to plead with its parent for a price cut when the facelifted model launches here within months.

But MMA acknowledges it could be up for a hard fight with Mitsubishi Motors Corporation (MMC) because the model is proving a hit in other markets where its pricing is aided by government green vehicle subsidies.

Once on-road costs are taken into account, the base model Outlander PHEV is priced above $50,000 in Australia, while the more luxuriously specified Aspire model heads north from there.

But MMA wants to pitch the Outlander from about $45,000 on-road, believing this will attract more interest from fleets as well as well as private buyers.

“We are negotiating and that is the intention,” confirmed MMA marketing chief Tony Principe. “Our expectation is we will be able to negotiate a lower position.

“We are keen to get it into what we call the fleet sweet spot and that is probably closer to the mid-$45,000 bracket than where we currently are.

“We are getting some traction with fleets who are coming to us saying ‘we are prepared to pay a premium but not the current premium’.”

The Outlander PHEV was launched with some fanfare by MMA in March last year, when it promoted the 2.0-litre petrol-electric hybrid’s 1.9L/100km claimed fuel consumption average and 52km electric range.

But sales have not met MMA’s targets, which were already modest because of limited supply.

“Sales are slow,” admitted Principe. “The buyers here are still learning the benefits of the technology and Australia doesn’t have any mechanism to encourage them.”

Principe said that lack of “mechanism” – meaning government subsidy – would not help MMA convince MMC to supply the car at a lower price.

“They are selling record numbers into Europe at very high profit because there are government tariffs,” he said. “Why would they want to give us cars at a discount when they can be selling them to countries in Europe and making a good profit?

“So it is very hard for us to convince them to send us some cars.”

The Outlander PHEV was noticeably absent from this week’s launch of the MY16 Outlander range, although Principe was clear that related to a different model cycle rather than any waning commitment to the car.

When it does arrive the PHEV is expected to be somewhat differentiated in terms of styling from the orthodox Outlander, which debuts Mitsubishi’s new ‘Dynamic Shield’ design language.

The PHEV is also tipped to gain performance upgrades.

Principe made it clear MMA had no choice but to stay the course with green vehicles, as they form a core portion of MMC’s future product strategy.

A PHEV version of the next-generation ASX is coming in 2016 or 2017 and there will also eventually be a hybrid version of the new Triton utility, which launches in Australia in May.

“Really it is in our long-term benefit to do that (bring in green vehicles), because Australia isn’t going to be immune,” he said. “If the trend in Europe and the USA is like this then all cars are going to go that way eventually.

“We would get caught behind. We can’t afford not to be in that technological race, so we have to stay in there and say to MMC ‘we are interested’.

“And the reality is pricepoints will come down. Once we get access to an ASX version of it (PHEV), it’s going to be at a lower price than an Outlander version – it’s just logical, it is a smaller car… our expectation is we will get more and more of that.”

Principe said longer term the cost differential would decrease between orthodox and new-tech vehicles as batteries become cheaper. Buyers would also be attracted as battery range increased and charging times decreased, he predicted.

While MMA hasn’t sold an i-MiEV for at least two years, the company insists it’s still available. Principe revealed more might yet make it into the country.

“We have a couple of large corporates who have come to us and said ‘can you get us some i-MiEVs?’ We are having a bit of think about it; do we want to bring a few more out or not?”