Mitsubishi Coy On Partnership - Brief Article

Automotive Industries, August, 1999 by Gerry Kobe

Mitsubishi Motors Corp. (MMC) President Katsuhiko Kawasoe says he is not interested in "anything less than a tree equal partnership," should his company ever consider a "merger." However, when pressed to respond to rumors of joint venture talks with Ford, DaimlerChrysler and particularly Fiat, Kawasoe simply won't comment.

Addressing a group of international analysts and journalists, Kawasoe was joined by Mitsubishi Motor Sales of America (MMSA) Chief Operating Officer Pierre Gagnon, and other key executives who painted a brighter picture of the company than its struggling market position reflects. Outwardly, Mitsubishi is positioning itself as an attractive partner for the right company, but if necessary, it is prepared to emerge as a trimmer and more focused independent company.

Kawasoe criticized industry analysts who have suggested that a merger should take priority in the company's plans, saying, "streamlining, restructuring and profitability come first." He adds that mutually beneficial business ventures that do not have capital tie-ups remain as the company's fundamental business position. Additionally, he spurned suggestions that Mitsubishi could or should leave the U.S. market, calling it "extremely important for our global competitiveness."

MMSA will receive a corporate investment of $1.4 billion to revamp all its products between now and 2004, including two new car-based sport utility vehicles to augment the Montero and Montero Sport. One will be a Japanese-built SUV to compete with Honda's CR-V and Toyota's RAV4, but the other will likely be built from a flexible design platform that would accommodate the new SUV as well as the Galant and Eclipse. That vehicle would likely be built in Mitsubishi's Normal, Illinois plant.

The single platform design is consistent with Kawasoe's long-term goal to eventually dedicate the Normal plant to Mitsubishi products. Currently it is under contract until 2005 to build the Chrysler Sebring and Dodge Avenger.

Also in the future plans for the U.S. is the company's gasoline direct injection (GDI) engine. Akira Kajima Mitsubishi vice corporate general manager of passenger car R&D, says U.S. Tier 2 emission standards proposed in May include regulation of the sulfur content of gasoline, which makes use of Mitsubishi's lean NOx catalyst feasible. Introduction begins in 2002 with California fleet sales and will spread as sulfur content is regulated nationwide.