Filed under: Hirings/Firings/Layoffs, Plants/Manufacturing, Mitsubishi, Australia
Mitsubishi set to close Australian plant
Australia's automotive manufacturing industry has taken a blow as Mitsubishi announced it will be closing its Adelaide plant, the facility that builds the 380 sedan. The news means approximately 1,000 workers will soon be out of a job. In fact soon means very soon, as March 31st marks the plant's final day. It will certainly be a quick and painful process; so much that counseling will be offered to outgoing employees. The Australian government even previously offered the Japanese automaker assistance in order to keep their local operations alive. However, the extra funds couldn't account for the 380's dismal sales. It is well known that Australians like their V8s and the 3.8L V6 engine powering the sedan was not enough to overcome the competition.
[Source: Live News]
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Reader Comments (Page 1 of 2)
D 8:41AM (2/05/2008)
Well, no. It wasn't a lack of V8 that killed 380 sales. It's the slowly eroding large car segment which has seen Falcon experience the lowest sales since its first decade on the market, the brand new Commodore slip a few percentage points... Aurion is doing pretty well but it could be picking up fleet slack. I've seen some Aurions used as police cars around the city.
MMA has pretty much been in trouble for years. A revised and discounted 380 couldn't stop it from folding. They ruined the Magna by not updating it then dumping it into fleets. So they changed the name and pretty much slashed sales by half because nobody knew what a 380 was. And bland styling on account of the American Galant design, which MMA couldn't afford to revise. MMA was doomed to fail. Such a shame for those workers.
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Louis Zezeran 9:07AM (2/05/2008)
not withstanding the market forces mentioned above, rather than the V6 issue I think the front wheel drive thing is more relevant. Most commodores and falcons sold are the 6 but when i think of the iconic aussie car, it cant be front wheel drive, its got to have its power in the rear wheels to get my blood pumping!
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tanooki2003 9:25AM (2/05/2008)
I really hate to hear news like this, especially when it affects a struggling automaker that does actually have good quality cars.
Unfortunately Mitsubishi has made their big mistake by investing in a sedan that has made Mitsubishi unpopular in most markets. The sedan itself, no matter what bumpers it has, is a disaster with it's out of date styling. I know that if they were already working on the Concept ZT as the next Galant then it would do better than this boring sedan. I'm not at all knocking the quality as I know it is a very well built sedan, it's just that styling is a big part in how well a car sells and well you can see this is not really doing it for them.
On another note I did notice that back in the late 90's Mitsubishi really had an edge with cars such as the 2nd gen Eclipse with turbo and AWD, the Diamante which rivaled most luxury brands such as BMW & Lexus. I still happen to really like the design of the last remaining Diamantes left on the road, the Galant with it's sporty but aggressive styling, the 3000 GT for people like me who want something very sporty, unique, a head turner, and have many different options such as the VR4 which I still proudly happen to own and drive daily, and the Montero Sport which seemed to be the perfect SUV for people who did not want a big huge Ford Expedition and wanted something different from the Ford Explorer.
I think IMO Mitsubishi sort of shot themselves in the foot with the 2000 Eclipse by combining the 3000 GT and the previous gen Eclipse into 1 car, taking away any cool edgy sporty feel and make it a touring car, killing the previous gen Galant & Diamante and using the 380 sedan as the next gen Galant, also killing the Montero Sport and instead just slightly inflating the Outlander to take it's place. I can understand why the Pajero/Montero had to go as that SUV had suffered many issues in the USA. The only thing they seem to have gotten right is the redesign of the Lancer and the redesigning of the current Eclipse, however we need to see more aggressiveness from Mitsubishi instead of using the typical "i give up and just want to settle" styling on their next batch of cars or they may end up losing more profits in other markets. Believe it or not there are a lot of people out there who still seriously miss the 2nd gen Eclipse and what that car stood for. An affordable, intimidatingly stylish, sporty, cop magnet, 2 door pocket rocket racer with AWD and turbo.
Come on Mitsubishi you had the fire in you once before, please we need to see it again.
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Temple 10:53AM (2/05/2008)
>>I really hate to hear news like this, especially when it affects a struggling automaker that does actually have good quality cars.
Mitsubishi Motors isn't struggling. They just announced a six-fold increase in profit along with the Australian plant closure.
After its terrible marriage to Daimler-Chrysler, Mitsubishi Motors has been profitable, especially with the success of the iCar and the Outlander in Japan. Beyond that they are now focusing heavily on emerging markets like Russia, China, Middle East, and India. They are also in the OEM manufacturing business and already build cars for Nissan and Peugeot.
The Austrialian plant has always been in danger, ever since the Global Engine Manufacturing Alliance was scaled back, and their revitalization plan was designed to shed as many jobs as possible.
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nagmashot 11:20AM (2/05/2008)
There was no terrrible marriage with Daimler Chrysler...
1. Daimler bought Mitsubishi
2. Mitsubishi was close befor bankrup as Daimler Chrysler jumped in..
3. Daimler pumped in 3 years over 5billion $ into Mitsubishi but that did not help to recover from the Mitusbishi mistakes made in the 90´s and from the Mitsubishi managment scandals short befor Daimler showed up...
4. After Daimler stoped pumping billions into Mitsubishi they were again in truoble
Mitsubishi managment is not able to proper run the company... today they survive because of the projects Daimler placed ..
engine plant in Europe were today Mitsubishi build their 1.1l ,1.3l, 1.5l, Mitsubishi recive thanks to Daimler connection from PSA (Citroen and Peugeot) and VW
Without Daimler Chrysler Mitsubishi would be histroy today..
Daimerl still owns the Mitsubishi Truck and Bus company and this is doing extremaly well since Daimler took over 85% of the stocks
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David Ebert 11:56AM (2/05/2008)
A real pitty as this is a very very nice car to drive. Hoprfully the Chinese or some other country will by the manufacturing plant and will update the styling. As for the workers who are the most loyal around I hope the find new jobs soon. This shows the changing world in Australia as the Corolla toped the sales charts in January, in fact Toyota out sold both Gm and Ford products combined. Ford must be very worried about it's new Falcon due out in a couple of weeks. It should be a great car but will any one buy it? take care David.
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Temple 12:12PM (2/05/2008)
>>There was no terrrible marriage with Daimler Chrysler...
Funny then that they became profitable immediately after separating itself form DCX's "Welt AG" control and restructuring plan entirely paid for and controlled by the Mitsubishi group.
In fact, all of the horrid decision making in the past, the recall conver-up (from M-Fuso which Daimler still controls), and 0-0-0 incentive plan was entirely with DCX at the helm.
In fact, none of the Daimler-Chrysler "Welt AG" merger and aquistion had anything good come out of it. Hyundai bailed early on (DCX owned a 10% stake) to Hyundai's own explosive success, Chrysler got dumped and is in financial ruin, and Mercedes reputation quality plummeted during the time and they lost billions.
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Takeo 12:15PM (2/05/2008)
What are you smoking Nagamshot?
Mitsubishi motors has never been owned by anyone other than the Mitsubishi Keiretsu. They have sold "part" ownerships to other companies and had alliances with others but no one has owned them outright.
I'm no fan of Mitsu-motors but let's be real here.
So, my advice to you is this.
1. Get your facts straight before you open your racist, Euro-centric piehole.
2. Work on your spelling and grammar. I realize that English isn't your first language but don't make an embarrassment of yourself.
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Stéphane Dumas 1:03PM (2/05/2008)
A big page of history who'll be turned, that Mitsubishi plant was once the former Chrysler-Australia operations
http://www.uniquecarsandparts.com.au/history_chrysler.htm
http://www.fastlane.com.au/Features/Valiant_Australia.htm
http://www.valiant.org/ausval.html
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Tourian 1:28PM (2/05/2008)
DCX never owned Mitsu, ever.
Hopefully the production of the 380 will switch to the Normal plant which is also under utilized and probably in danger of being closed.
EquinsuOcha 5:45PM (2/05/2008)
Say no to drugs, kids.
1. Daimler has never owned Mitsubishi. Their joint North American venture was called Diamond Star Motors, and it was a way for Mitsubishi to bring cars to the United States and also a way for Chrysler to compete by using small, fuel efficient and low cost vehicles.
2. Mitsubishi has never been close to bankruptcy, but has had financial trouble in the past, mostly when DCX bailed out of some of the joint operations that they held together (Mitsu built the Smart ForFour in the Netherlands as the European only Colt), as well as Mitsubishi taking over some of the shared assets such as the Normal, IL plant and the one that is now closing in Australia. As previously mentioned by Temple, the 0-0-0 plan was a DCX idea, which destroyed MMCA with bad debt. Then DCX refused to continue buying into the joint ventures, and Mitsubishi Global came in with the extra funding. Their reorganization process is two years ahead of schedule and has returned the company to profitability.
3. See above as far as financial aspects go. As for the "scandals", they were the result of the Mitsubishi Fuso commercial truck company (owned and operated by DAG) that was responsible. There were no such incidents in North America, or in any other market.
4. See #2.
5. You said Mitsubishi Management is able to run the company properly, but again, they've returned to profitability, are sales are up in every market, and have tripled in Asia and doubled Europe (up 11% in North America). Sounds like they're doing pretty well to me.
6. I have no idea what you were trying to say about the engine plant. Ok, so they have joint ventures with PSA? And? They rebadged the Outlander for the European market, and shared small motor manufacturing for the Colt and Smart vehicles. How does that make them dependent upon DAG again?
7. DAG still owns 85% of Mitsubishi Fuso, yes. And they are doing very well, so good for them. MMC spun them off in 2003.
I don't see how this makes Mitsubishi a bad car company, and how it makes DAG a better one.
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rsjg 9:47PM (4/11/2008)
I'm looking to buy a 2007 Endeavor, largely because of the long warranty. You seem to know a lot about Mitsubishi Motors. Do you think they will be around in 5 to 10 years to honor the warranty?
Revhed 6:18PM (2/05/2008)
Well actually the so called "scandals" relating to a failure to recall vehicles went beyond their Fuso business:
http://www.smh.com.au/articles/2004/06/03/1086203561764.html
But whatever - that's in the past and it looks like Mitsubishi are making the hard but necessary decisions they need in order to strengthen their company.
It is a shame though - The 380 was an excellent car for the money and a better drive than the Camry V6... I mean Aurion.
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gnyd 7:04PM (2/05/2008)
The axe has been hanging over MMA for years, and that had a major dampening effect on sales.
The exterior styling is also a major dampener on sales - MMA had better options, but either blew it or were nixed by Japan.
The sales and marketing for the 380 has been just as dull as the car's looks - not even shawl-shrouded grannies could get excited about it.
Underneath all this was a car which is not at all bad, but then, there are a lot better looking, better marketed cars which that applies to, and it was pretty obvious the 380 was facing exactly this sort of death.
A great pity for the workers, for Adelaide, and eventually for the Australian car industry, which is already suffering from scale problems.
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gnyd 7:04PM (2/05/2008)
The axe has been hanging over MMA for years, and that had a major dampening effect on sales.
The exterior styling is also a major dampener on sales - MMA had better options, but either blew it or were nixed by Japan.
The sales and marketing for the 380 has been just as dull as the car's looks - not even shawl-shrouded grannies could get excited about it.
Underneath all this was a car which is not at all bad, but then, there are a lot better looking, better marketed cars which that applies to, and it was pretty obvious the 380 was facing exactly this sort of death.
A great pity for the workers, for Adelaide, and eventually for the Australian car industry, which is already suffering from scale problems.
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azetm 8:07PM (2/05/2008)
There is already a modified version of the Galant made by CMC (Taiwan) : the Grunder !!!
If you want to see this taiwanese modified galant some years ago (front and back modification)
go to this links in English:
http://www.cmc-motor.com/products/grunder/index.htm
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Mitsufan 1:21AM (2/06/2008)
Yeah, that's why Chrysler is in the pits now too.
Daimler is a parasite.
They reconfigured the Mitsubishi / Chrysler lineup to mate with its own needs (Mitsubishi -- small cars, Chrysler -- medium cars, Daimler -- top-end cars). Their mismanagement helped drive both companies into the ground.
Now they're using Fuso to get at their dealer network in Asia, and as soon as they get that, they'll toss them to the curb too.
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Mitsufan 1:21AM (2/06/2008)
Takeo
I'm going to assume for the moment that you're not just some name-calling troll.
DCX had controlling interest of Mitsubishi Motors -- from 2000 through 2004. They call it an alliance in the press releases, but this was no marriage of equals. DCX got a majority stake and seats on the board. That's a buyout.
What mitsu is doing now with PSA is a real alliance -- doing something that benefits both parties. Mitsu was basically just Daimler's b*tch for a while there.
http://media.mitsubishi-motors.com/pressrelease/e/corporate/detail869.html
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Kenn 4:52AM (2/06/2008)
In the late 90s there was an economic crisis in the east Asian countries( Thailand, Indonesia, Malaysia….). Both Mitsubishi & Nissan had bulk of the market share of this region. Both Nissan and Mitsubishi started to struggle and Nissan's controlling share was purchased by Renault and Mitsubishi's controlling share was purchased by Daimler Chrysler. On top of the Asian Economic crisis Mitsu had bad publicity on the Recall cover up as well as North American lax credit crisis.
The fact is Nissan came out of this slump with array of new models and expanding in other markets like North America, Renault helped this recovery buy investing in Nissan's recovery. In contrast Daimler Chrysler was quite slow in investing on new Mitsubishi models. Also the new models designed and built during the Daimler Chrysler owned period have been poorly styled lack luster cars like the US Gallant.
Cumming back to the 380 is a good car. The main reason 380 sales didn't pick up was because it was introduced in late 2005, while the North American Gallant was introduced in 2003. From the start 380 looked bit outdated. The main mistakes was the omission of the 4cyl engine, that could have doubled the sales. Other issues were styling, omission of the 3.8 L Mivec engine on high end models, lack of ESP and curtain air bags.
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BEGME2 5:42AM (2/06/2008)
Mitsubishi could never get it through their thick skulls that Aussies buy Falcons and Commodores because they're rear wheel drive. You don't grow up as a kid dreaming of driving front wheel drive Japanese FAMILY saloon. You dream of driving a rear wheel drive family saloon that looks like the sportier versions of the same model and look like the basis of a V8 Supercar.
Doing burnouts or trying to go side ways in a FWD is just crap LOL. It wasn't until the late 90s/early 2000+ that FWD actually started to handle good. The perception remains that FWD handle crap and are dangerous in the wet. Whether this is true or not doesn't matter, until you change peoples minds you won't out sell Falcon or Commodore in the large family saloon sector.
Toyota is equally as dumb but they have a massive Middle East market to flog their Aurion off to.They're also in a land of fantasy if they actually believed the Aurion could be king in Australia, and if they think their TRD models can take on FPV or HSV I'd like to smoke or snort the substance their marketing department is on LOL.
/end rant LOL
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