Steering through the Mitsubishi storm

HAVING survived his toughest week in office at Mitsubishi Australia, president Tom Phillips is now working on saving what he’s got left.

This counts for the Mitsubishi brand as a whole as much as the Magna he manufactures, and among the tasks ahead for Mr Phillips are rubbing the tarnish off the three-diamonds logo and making a new case for building a second car in Adelaide.

With the long-wheelbase US-export model a victim of Mitsubishi’s worldwide restructure, a car line running next to the all-new Magna replacement will be critical for securing Australian production until at least 2011. But getting it will take some time – and will be no guarantee for the future.

"I don’t think anything’s going to be guaranteed, no matter what you do, but it would certainly allow us to capitalise and utilise the (Tonsley Park) facility a lot more," Mr Phillips said.

"We know very clearly that we can run a second car easily down through our facilities, all the new equipment we’ve bought in is designed to do a bigger car or a smaller car – whatever is required. We have a huge amount of flexibility." Mr Phillips said he would make a case for a second car line once the dust had settled and he had strengthened ties with Mitsubishi Motor Corporation’s new board of management. Several vehicle possibilities exist, including a new Asia car announced in Japan last week and a cross-over all-terrain wagon.

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They know that we’re here, willing and capable to add another model at any time they wish

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"The issue at the moment is that we haven’t discussed any of this with Japan. I have my own feelings that I would love to build a cross-over vehicle but if the Japanese read that I was out pushing for a cross-over vehicle I’d probably be fired tomorrow, quite frankly, because they’re just not ready for that sort of discussion," Mr Phillips said.

"They know that we’re here, willing and capable to add another model at any time they wish. But at this stage, there is nothing whatsoever on the drawing board." He said a case for expanding the Tailem Bend R&D centre would also be taken to Japan in due course.

"In the current environment, we haven’t been up there pounding on the door saying, ‘Give us more work.’ But as things settle down and we become known to the new management … we can present some ideas on the benefits of R&D in Australia – and there are many opportunities," he said.

"The benefits of doing R&D here, particularly for vehicles which you don’t sell yourself, are quite considerable – a 35-45 per cent subsidy from the government. So there is real benefit there." In the meantime, Mr Phillips’ main focus will be on rebuilding public confidence between now and the all-new Australian-built car, due October 2005, with two new marketing strategies and new vehicle rollouts which over the next five months include the Colt hatch, Grandis people-mover, Lancer Evo VIII, Magna VR-X Quadtec and Lancer Sportswagon.

"This is not just about Magna, this is about the Mitsubishi brand," Mr Phillips said.

"Now, the Mitsubishi brand is going to be very much enhanced by a range of new products coming through, leading-edge technology, new marketing concepts – so between now and the launch of the new car, we should be able to change the perception.

"We’ve got to do those things right, and (then) we’ll leverage off them as we go forward in trying to reduce this negative effort that we don’t have a long-term future.

"And in the very worst ‘holocaust’ situation, where we stop manufacturing, we’d be a Nissan or a Honda or a Mazda – we’ll still have a strong presence because the products we’ve got coming through 2006/7/8 are class-leading."