Business Report, South Africa
Mitsubishi eyes Asia for expansion
October 18, 2005
Tokyo - Japan’s Mitsubishi Motor has set its sights on Thailand and other Asian nations for future expansion, the president of the automaker said on Tuesday.
"ASEAN (Association of Southeast Asian Nations) — Thailand in particular — has been strong and contributed to our profits. We want to expand in the places where we are strong," said Osamu Masuko who took over in January.
"Thailand has accepted Japanese firms from early on. The country has created a good business environment for Japanese companies," he told the 2005 Tokyo International Automotive Conference.
Japan’s fourth-largest automaker has two plants in Thailand, one with annual output capacity of 180 000 vehicles and another with 120 000. It will increase the capacity of the smaller plant by 20 000 in early 2007.
In Thailand, Mitsubishi aims to increase its market share by 0.5 percentage points to 7.0 percent in the year to March 2006, partly with the help of its new pick-up Triton released in August.
The firm has said it had sales targets of 180 000 vehicles for the ASEAN region in the financial year 2007, and 220 000 in 2010.
"With FTAs (free trade agreements) envisioned with Asian countries, such as ASEAN and India, we should reap benefits of such initiatives," Masuko said.
Mitsubishi Motors will also focus its efforts on emerging BRICs markets - Brazil, Russia, India and China, he said.
The automaker faces serious difficulties at home, where its brand image has deteriorated due to massive defect cover-up scandals uncovered in recent years, which sent sales nosediving and pushed its bottom line into a loss.
Mitsubishi in July took legal action against seven of its former executives, saying they bore responsibility for the company’s woes.
In addition to the scandals, the company’s aggressive attempts in the 1990s to expand into various foreign markets were "beyond our capability," and invited the current financial difficulties, Masuko acknowledged.
The firm had also failed to make the best out of the products lineup in the past, the president said.