250 out of 380
BY NEIL MCDONALD | 2nd Feb 2006
It is widely believed poor sales of the new 380 sedan have been blamed for last week’s decision to offer voluntary redundancies to 250 workers at the plant.
Because of a downturn in large-car sales, Mitsubishi has decreased 380 production this year from 32,000 to 27,000.
In an effort to stem the damage from a lack of large-car sales – a problem shared by other local car-makers – Mitsubishi plans to re-invigorate its marketing and sales push for the 380.
Spokesperson Sequoiah Fischer told GoAuto this week that a renewed marketing campaign was planned for the 380, which, among other things, would involve re-branding the car to move it further away from the Magna.
Mitsubishi Australia intends to spend $2 million per month on the marketing and advertising campaign, while president and chief executive Rob McEniry has vowed not to discount the vehicle.
Ms Fischer said fleet sales of the 380 were going strong “but we’re not going to see some results until March”.
Mitsubishi is not alone in experiencing the slowdown. Holden, which builds the Commodore and derivatives from the Adelaide-based Elizabeth plant, cut its third shift at the end of last year with a loss of 1400 jobs.
Melbourne-based Ford has also experienced a slump in its Falcon sales,due in part to the success of its Territory off-roader.
Last year, Commodore sales were down 12,376 and Falcon sales were down12,304 over 2004, despite both models continuing to dominate the large-car sector.
Demand for large cars slumped 15.7 per cent last year in a total market that was up by 3.5 per cent to a record 988,269 vehicles, according to VFACTS industry figures.
In contrast, demand for more fuel-efficient small cars jumped by 18.9 per cent.
The 250 Mitsubishi workers made redundant last week will be offered voluntary redundancy packages and the South Australian government has committed to helping them find new jobs.
The company’s Adelaide workforce has fallen from 4500 to about 2000 since 1998. In 2004, Mitsubishi slashed its workforce by 1000 when it closed its Lonsdale engine plant.
Last week, Mr McEniry said the company was forced to cut production at Tonsley Park to ensure the long-term viability of its manufacturing operations.
Although the new Mitsubishi 380 had increased its share of the large-car market over the Magna, Mr McEniry acknowledged a general softening in the large-car segment on the back of increasing petrol prices and changes in buyer habits.
Last year 70 per cent of all passenger vehicles sold in Australia were imported.