Wednesday, 13 December 2017
Car News

Mitsubishi COO Mann looks to reduce reliance on SUVs in Europe



AUTOMOTIVE NEWS EUROPE MONTHLY MAGAZINE

Mann: “You can sell just one type of vehicle, but you’ve also got to look at what doors that closes.”

Photo credit: Bloomberg

Carlos Ghosn’s first steps after Nissan took a controlling stake in scandal-hit Mitsubishi Motors last October were to install himself as chairman and to appoint Trevor Mann, then Nissan’s chief performance officer, as Mitsubishi’s chief operating officer. The British executive faces the complex task of integrating the Japanese automaker into the Renault-Nissan alliance and addressing Mitsubishi’s heavy reliance on SUVs in Europe. Mann outlined his plans to overcome those challenges in an interview with Automotive News Europe Correspondent Nick Gibbs.

The launch of the Eclipse Cross between the ASX and Outlander gives Mitsubishi four SUVs in Europe. Could Mitsubishi become an SUV-only brand?

You can sell just one type of vehicle, but you’ve also got to look at what doors that closes. If people like your cars they will likely buy more than one of them for the family, so we’ve got to make sure we’ve got a relevant and coherent offering.

What percentage of your European sales are SUVs?

We were 77 percent last year if you include pickups.

Mitsubishi’s approach to models has been all over the place. Does it need to be more focused?

It has been a bit inconsistent. I think we need to be quite focused in terms of where we want to go in the future.

Mitsubishi has said a new EV is coming. Will that car be switched to Nissan EV technology?

This is something we are looking at now.

Can you produce cars in Nissan factories?

It’s under consideration. We have about 20 cross-company teams working on technological, regional and functional access to understand how we can help each other.

Plug-in hybrids are one of Mitsubishi’s strengths while Nissan has never been that enthusiastic about the technology. Will that change?

Mitsubishi is the world’s No. 1 plug-in hybrid manufacturer. This year we’re looking at [selling] more than 100,000 units. The technology we use is very good. We are seeing more plug-in hybrids coming into the market, but we still have a unique offering. It’s a fundamental part of our future strategy. When we talk about synergies, this is something that we can offer Nissan so that Nissan doesn’t have to develop its own.

Does Mitsubishi need to expand the number of markets it’s in?

One of Mitsubishi’s strengths – as well as one of its weaknesses — is that we’re in almost every major market — the U.S., China, Southeast Asia, Europe, Russia. Personally, I don’t think we’re punching at our weight in Europe. I’ve got higher expectations. We’re certainly not punching at our weight in the U.S. or China. If you look at what our brand can deliver, we’ve got a 15 percent market share in the Philippines, 8 percent to 9 percent in Indonesia, 8 percent in Thailand, 7 percent to 8 percent in Australia. That’s what our ambition should be.

Do you need to leave any markets?

Once you’re in, you’re in. If you start to be in and out, you have problems with investors and customers, so we’re in. What we’ve got to decide is where the growth is coming from in the short to midterm. We can’t fight all corners, but we can say, “These are priority markets.”

What are the achievable synergies between the two companies?

We are already shipping cars on the same transporters and the same boats. We are also talking about how to converge on vehicle technologies. For full convergence, you just need to look at Nissan and Renault to see how long these things can take. That being said, we’ve got the benefit of understanding what went wrong [while converging Renault and Nissan], why it took so long and how we can do it quicker.

What can Nissan do for Mitsubishi?

It can provide scale as well as access to platforms, powertrains and advanced technology that a company of 1 million units may find difficult to invest in.

And vice versa?

What Mitsubishi can bring to Nissan is 1 million units, 4×4 technology, the technology for the body-on-frame vehicles, such as the Pajero Sport SUV and the pickups, and plug-in hybrid technology. We also are extremely strong in Southeast Asia, so we can help Nissan grow there also.

Meet the COO


Name: Trevor Mann
Title: Mitsubishi Chief Operating Officer
Age: 56
Main Challenge: Creating synergies between Mitsubishi and its new alliance partners in less time than it took for Renault and Nissan to work together effectively.

Could you, as Renault does with Dacia, rebrand Nissan or Renault models to strengthen Mitsubishi in markets were its sales are weak?

I’m not a big fan of cross-badging. You can convince yourself it’s a good idea, but convincing the customer is more difficult. If you look around the industry, the examples of where it works are few and far between. It works for LCVs [light commercial vehicles] because the reason for purchase is not necessarily the brand, but more the sense of comfort you get with your dealer and network.

Is cross-badging most suited in emerging markets?

It’s ideal when one brand is really strong and the other brand doesn’t have a strong presence. For example, Renault is almost non-existent in Southeast Asia, so if it made sense for Mitsubishi to cross-badge a Renault product there that could be an interesting discussion.

What are Mitsubishi’s core strengths?

SUV and 4×4 technology. That’s what many people come to Mitsubishi for. That’s not to say we will close the door on everything else, but we’ve got to build a platform on our strengths. Do that and we can afford a lot of nice-to-haves. If you look at other brands of similar or perhaps double or three times our size, you’ll see that three to four cars can be 60 percent to 85 percent of their sales. That’s where we need to be. Then you’re generating volume, revenue and brand strength, so people understand what you are because they’re seeing a relatively coherent family of vehicles.

Is an electric car one of those nice-to-have models or a core model?

I think it’s necessary.

You can reach Nick Gibbs at ngibbs@crain.com.



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