• Mitsubishi-Nissan alliance:

    Preparation for unforeseeable

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    lancer20161122The recent alliance between Mitsubishi and Nissan was about preparing for the future of a rapidly evolving automobile industry and competing against new entrants, like Google, an executive said.

    In Tokyo two weeks ago, Osamu Masuko, chairman, president and chief executive officer of Mitsubishi Motors Corp., spoke to a group of journalists from the Philippines.

    Speaking through an interpreter, he said that it was easy in the past to identify who were their competitors, who were the other car companies. Today, he added, people hear about new entrants in the car business like Google and Dyson.

    The Internet giant Google is presently developing a driverless car. Dyson, which is better known for making vacuum cleaners and bladeless fans, is reportedly developing an electric motor for vehicles, like the American firm Tesla, but with funding from the British government.

    Masuko said that the concept of a car was changing, and it was hard for him to imagine cars of the future that may not have familiar features like a steering wheel.

    “We don’t know what will happen in the future,” Masuko said, even citing as an example that few people predicted that Donald Trump would be the US president. The executive added that the deal with Nissan would help Mitsubishi prepare for whatever will happen, and also offer synergies.

    Nissan was strong in the US and Chinese markets, while Mitsubishi was strong in ASEAN, Masuko explained.

    ASEAN is the Association of Southeast Asian Nations, a regional bloc of 10 countries that include the Philippines. ASEAN is also drawing a lot of attention because of its rapidly growing economies and large market of about 600 million people.

    Masuko also said that Mitsubishi and Nissan were collaborating on making electric vehicles, adding the development of the battery was their biggest challenge to date.

    In remarks that he read in English, Masuko said: “The alliance has the basic spirit of respecting each other’s brand, history and management autonomy. The brand, marketing and sales network will be kept separate as in the past, but on the other hand, we aim for greater synergy impact in the field of purchasing, vehicle platform, development of advanced technology, growing markets, joint plant utilization and financial services.”

    With its 34% stake in MMC officially acquired just last month, Nissan became Mitsubishi Motors’ largest shareholder. In turn, MMC officially became a member of the global Renault-Nissan alliance.

    MMC, together with other Japanese firms that include Sojitz Corp., owns Mitsubishi Motors Philippines. The latter has the second-largest market share in the Philippine auto industry at 17%.

    Mitsubishi’s modern cars may one day become museum pieces, like these vintage ones at the Mitsubishi Auto Gallery in the automaker’s Okazaki plant near Nagoya in Japan.

    Mitsubishi’s modern cars may one day become museum pieces, like these vintage ones at the Mitsubishi Auto Gallery in the automaker’s Okazaki plant near Nagoya in Japan.

    Bullish on PH outlook
    As for the future of the Philippines, Masuko said that it was clear and bright.

    Last June, Mitsubishi committed to joining the government’s Comprehensive Automotive Resurgence Strategy (CARS) program, which offers incentives to manufacturers to make automobiles locally.

    Mitsubishi pledged to invest $4.3 billion in the Philippines, where it will make the Mirage G4 beginning in 2017 and the Mirage later on.

    Yoshiaki Kato, president and chief executive officer of Mitsubishi Motors Philippines (MMP), told The Manila Times: “We have a dream of exporting from the Philippines.”

    He said that the investment pledge of Mitsubishi could even grow, given that its new stamping plant in Santa Rosa, Laguna, represented a large chunk of P4.3 billion. That amount should last about three years or half of the CARS program’s lifespan, and if the initial investment pays off, Mitsubishi could look at investing more in the Philippines, he added.

    Kato also said that a second shift has started working at the plant, increasing the number of workers there to about 1,500 from nearly 1,000 in December 2015.

    However, he said that the Philippines needed to compete with other countries that already export, like Thailand. And he added that the local car market would need to grow and that production quality should be improved before exporting from the Philippines could become feasible.

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