A new agreement between three Alliance brands could mean that Mitsubishi will begin building cars in France.
A new agreement between three Alliance brands could mean that Mitsubishi will begin building cars in France.
This new report from the Financial Times suggests that Mitsubishi may be on the verge of reversing its decision to leave Europe, which has been caused by mounting pressure from its Renault and Nissan Partners.
Mitsubishi halted the release of its new models in Europe last July following on from a shift in focus to the more profitable Asian market. The Japanese brand planned to reduce fixed costs by 20% over two years with the introduction of its new Small but Beautiful operating strategy, which aimed to “improve operating profit by downsizing low-profit businesses”.
The report is now suggesting that the manufacturer may shift some of its European-market model production to Renault factories in France. This report states that this information has come from an internal source at the Renault-Nissan-Mitsubishi Alliance that has “direct knowledge on the matter”.
It has been said that a preliminary agreement was reached by the three companies on the 22nd February, but a final decision has yet to be reached. This deal may still not come to fruition as the internal source stated that the discussions within the Alliance were “fractious”.
It was also stated that bosses at Mitsubishi, which is 34% owned by Nissan, of which Renault holds a 43% stake, don’t want the strategy of the alliance to be impacted by French politics. However, the Alliance could now face accusations of bowing to pressure from the French government (owning 15% of Renault) in a bid to protect jobs.
A spokesman for Mitsubishi stated that the brand had no comment to offer on the speculation, but a different representative later tweeted “We won’t comment on this but I can tell you that Mitsubishi’s plans to transition to an aftersales-only business before the end of the year have not changed”, which suggests that whilst there is a possibility that a European restart may still go ahead, it is unlikely the same will happen in the UK.
That relaunch in the UK would have served as a much needed lifeline for the Colt Car Company, which is the retail network for Mitsubishi in the UK. A number of dealerships have already begun their preparations to transition over to an aftersales-only offering, which could now be given the chance to order additional stock. However, there are already a number of dealerships that have sold their premises.
This potential for a market reintroduction increases the chances of the recently announced all-new Outlander SUV going on sale in Europe. This plug-in hybrid version of the Outlander is one of the most popular PHEV models in Europe, with this latest version offering Mitsubishi the opportunity to recapture ground lost to the newer PHEV rivals that have been released.
This is an interesting development and we will definitely be waiting to see what the final agreement is in the hopes that this will also lead to a reintroduction into the UK market, even if that does seem less likely at this time.