Mitsubishi Motors North America

Mitsubishi Motors North America

Type	Subsidiary
Founded	1981
Headquarters	6400 Katella Avenue, Cypress, California, 90630-0064
Key people	Hideyasu Tagaya (Chairman) Hiroshi Harunari (President, CEO) Dan Booth (EVP, CFO)
Products	Automobile manufacturing and R&D
Parent	Mitsubishi Motors (100%)
Subsidiaries	Mitsubishi Motors R&D of America, Inc. (MRDA) Mitsubishi Motor Sales of Canada, Inc. (MMSCAN)
Website	mitsubishicars.com, mitsubishi-motors.ca

Mitsubishi Motors North America, Inc. is the North American operation of Mitsubishi Motors Corporation, overseeing sales, manufacturing and research and development functions. The company manufactures and sells Mitsubishi brand cars and sport utility vehicles through a network of approximately 450 dealers in Canada and the United States.

Its administrative headquarters is in Cypress, California, along with its California research and development office, while the Mitsubishi Motors R&D of America, Inc. (MRDA) head office is in Ann Arbor, Michigan.

History

MMNA was formed in 1981 after tensions arose between Mitsubishi and its then U.S. import partner, the Chrysler Corporation, over conflicts in the international subcompact market, leading the ambitious Japanese company to establish its own sales network.^[1] The first year's allocation of 30,000 vehicles in 1982 were the $6,500 Tredia sedan, and the $7,000 Cordia and $12,000 Starion coupes, followed shortly by the Mighty Max pickup truck, and were sold through 70 dealers in 22 states.^[1]

Diamond-Star Motors Logo

The Diamond-Star Motors joint venture with Chrysler in Normal, Illinois began in 1985, as American-built cars would not be subject to the same restrictive quotas as vehicles imported from Japan. The company sold 67,000 cars in the United States in 1987, but by the time the new factory came onstream the next year, it offered a capacity of 240,000 vehicles. With this new capacity, Mitsubishi made a fresh push to expand its American operation in 1989, increasing its sales network by 40 percent to 340 dealerships and producing its first nationwide advertising campaign.

Mitsubishi's North American R&D facility in Ann Arbor, Michigan.

1991 was a landmark year for Mitsubishi in the United States. It bought Chrysler's share of Diamond-Star for $100 million, and became the first Japanese owner of a U.S. car rental agency when it purchased Value Rent-a-Car^[2] Sales of Mitsubishi-badged vehicles reached almost 190,000.^[1] The remainder of the 1990s provided both ups and downs for MMNA. The rising yen and a weak global economy caused a drop in production and profits, but it weathered the storm better than its Japanese competitors.

While its global operations were suffering in the wake of the 1997 East Asian financial crisis, MMNA reported banner results, breaking its sales records every year between 1999 and 2002 and seeing growth of 81 percent to 345,000 vehicles, while the company improved its position in Harbour and Associates' Assembly Productivity Ranking from last to first.^[3][4] At this point Mitsubishi was the fastest growing auto brand in the United States.^[5]

In 2002 MMNA expanded to Canada and Puerto Rico.

Troubles began to emerge in 2003. One of the roots of their rapid growth was a "0–0–0" finance offer—zero percent down, zero percent interest, and nothing per month (repayments deferred for 12 months)—aimed at increasing MMNA's annual sales to 500,000 vehicles. However, numerous credit-risky buyers ended up defaulting at the end of the year's "grace period", leaving Mitsubishi with used vehicles for which they'd received no money and which were now worth less than they cost to manufacture.^[6][7] The company's American credit operation was forced to make a $454 million provision against its 2003 accounts as a result of these losses.^[8] In the wake of this, as well as a Japanese recall cover-up scandal, sales plummeted from 2003 to 2005,.^[9] New introductions had mixed success, with the Outlander and Eclipse models showing sales growth in 2006, but the Endeavor SUV failing to meet expectations. A new Lancer compact car debuted in 2007,^[10] and in an effort to exploit unused capacity at its Normal, Illinois plant more Galant sedans were produced for the export market.^[11] In 2008 Puerto Rico operations were moved to their Central and South America region division.

Mitsubishi Lancer Evolution

2015 was a record setting year for MMNA, selling their 5th million vehicle in the United States, continuing a streak of 22 consecutive months of year-over-year sales increases and a 23 percent sales increase over the previous year.^[12][13] Additionally many changes were made in 2015; MMNA ended their captive finance subsidiary Mitsubishi Motors Credit of America, Inc. (MMCA).^[14][15] In July, MMNA announced that they would be closing their sole North American production facility in Normal, Illinois, known Mitsubishi Motor Manufacturing of America which built the Outlander Sport model, to focus more on the growing Asian market. Production at the plant ended in November 2015, and the plant will produce replacement parts until final closure, which is scheduled for May 2016.^[16] However, Mitsubishi will still be selling cars in North America thereafter, but is retiring the i-MiEV and Lancer Evolution.^[17]

Sales

Year	Canada	United States	Total
2000	-	314,417	314,417
2001	-	322,393	322,393
2002	?	360,149	360,149+
2003	?	237,548	237,548+
2004	10,783	127,359	138,142
2005	10,391	99,600	109,991
2006	10,957	107,640	118,597
2007	16,759	106,719	123,478
2008	18,639	67,910	86,549
2009	19,786	39,970	59,756
2010	19,504	55,683	75,187
2011	20,511	79,020	99,531
2012	19,671	57,790	77,461
2013	21,104	62,227	83,331
2014	22,704	77,643	100,347
2015	21,384	95,342	116,726

Sources: ^{[13] [18] [19] [20] [21] [22] [23] [24] [25] [26] [27] [28] [29]}
NOTE: Mexico sales are not included, because distribution and sales are handled by FCA Mexico.^[30]

Current Vehicles

i-MiEV North America	Mirage North America	Lancer North America	Outlander North America	RVR/Outlander Sport Canada/United States

Past Notable Vehicles

3000GT 1990-1999	Eclipse 1990-2012	Galant 1993-2012	Lancer Evolution 2003-2015	Montero 1990-2006

Controversies

In 1994 MMNA was the subject of two lawsuits brought against it. The first, filed by 29 women in December 1994, accused the company of fostering a climate of sexual harassment at its Normal, Illinois plant. Then, in April 1996 the Equal Employment Opportunity Commission (EEOC) filed a class action suit on behalf of approximately 300 other women who worked at the plant. Mitsubishi initially denied any problems at its plant but later hired former U.S. Labor Secretary Lynn Morley Martin to recommend changes to its policies and practices. The 1994 suit was settled for $9.5 million in August 1997, and an agreement with the EEOC was reached later that year as well.^[31]

References

1. "Mitsubishi Motors Corporation", Funding Universe
2. "If They Rent, They May Buy", TIME Magazine, May 14, 1990
3. "Finbarr O'Neill Resigns From Mitsubishi Motors North America Mitsubishi Motors Executive Rich Gilligan Appointed to President and CEO Position", AutoChannel.com, January 4, 2005
4. "Mitsubishi Motors North America, Inc. - Manufacturing Division", Mitsubishi Motors North America website
5. "Mitsubishi Motors", University of North Carolina
6. "Can Mitsubishi Pull out of its Skid?", Brian Bremner and Christopher Palmeri, BusinessWeek, September 29, 2003
7. "It's the Dealers, Stupid!", Steve Findlay, Ward's Dealer Business, September 1, 2004
8. "Mitsubishi Motors Announces First-Half FY 2003 Results, Gives Forecast for Full-Year FY 2003" Mitsubishi Motors press release, November 11, 2003
9. "MMNA sales down 4% in 2006", Scott Miller, The Pantagraph, January 5, 2007
10. "Mitsubishi Motors to give new Lancer compact sport sedan global premiere at 2007 Detroit Motor Show" Mitsubishi Motors press release, December 11, 2006
11. "Mitsubishi's turnaround hinges on new models, worker mindset", Yuzo Yamaguchi, The Detroit News, October 31, 2005
12. "MITSUBISHI MOTORS ACHIEVES FIVE MILLION VEHICLE SALES IN THE UNITED STATES"
13. "MITSUBISHI MOTORS CLOSES 2015 UP OVER 22 PERCENT FOR THE YEAR"
14. "Mitsubishi Motors Taps Ally on Finance". 2015-04-27.
15. "Ally to take over Mitsubishi's U.S. lending arm". 2015-04-27.
16. "Union workers say goodbye to 27 years at Mitsubishi plant". 2015-11-30.
17. http://www.automobilemag.com/features/news/1507-report-mitsubishi-to-close-us-production-facility/#ixzz3gq9Uw4BI
18. "Facts & Figures 2005"
19. "Facts & Figures 2008"
20. "Facts & Figures 2010"
21. "MITSUBISHI MOTORS ENDS 2014 WITH DRAMATIC SALES INCREASE"
22. "MITSUBISHI REPORTS RECORD YEAR"
23. "MITSUBISHI REPORTS 6.2 PERCENT INCREASE FOR 2009"
24. "WRAPPING UP 2010; RVR AND OUTLANDER POWER MITSUBISHI SALES TO RECORD DECEMBER"
25. "RECORD DECEMBER POWERS MITSUBISHI TO BEST YEAR EVER"
26. "MITSUBISHI SETS ALL-TIME SALES RECORD IN 2013"
27. "MITSUBISHI SETS NEW SALES RECORD IN 2014"
28. "OUTLANDER DRIVES BEST RETAIL SALES YEAR FOR MITSUBISHI"
29. "Mitsubishi Brand Sales Figures"
30. "FCA handling Mexico distribution"
31. "MMNA and EEOC reach voluntary agreement to settle harassment suit", EEOC press release, June 11, 1998

External links