Under the Microscope: We speak to Mitsubishi's MD and head of corporate sales
24 August 2018
Author: Rachel Boagey
Mitsubishi may only be a small player in the industry but recent partnerships and solid plans may change that once and for all. Rachel Boagey reports.
My sat-nav must be taking me the wrong way, I thought, and grumbled with irritation as I entered a skinny cul-de-sac somewhere in Cirencester. My doubts weren't even alleviated when I read the sign 'The Colt Car Company' but then I saw it, the three-diamond emblem, and I knew I had arrived ready for my meeting.
It may not be the easiest place to find but this is Mitsubishi's UK headquarters, which is funny because the company's dealerships are rarely easy to come across either, and the reason for this isn't the most obvious, but once managing director Rob Lindley explained, it all made sense. "We only have 109 dealers around the UK and, as Mitsubishi traditionally served rural communities, we're yet to fully make our mark in the larger metro locations," he tells BusinessCar.
Increasing dealer reach is just one third of Mitsubishi's plan for expansion over the next few years, along with two other vital growth mechanisms; increased product launches and working on successful partnerships to help get the Mitsubishi name out there even more than before.
Clive Messenger, head of corporate sales
The Mitsubishi love triangle
The three-diamond logo had been around far before a few interesting developments at Mitsubishi, but out of what can only be pure coincidence, Lindley describes the company as a bit of a "love triangle".
While the trading name is Colt Car Company, which represents Mitsubishi in the UK, the company is actually a 100% subsidiary of Mitsubishi Corporation, a huge trading company that has all sorts of businesses around the world - such as shipping and electricals - and it even owns a salmon producer. "Then you have Mitsubishi Motor Corporation, which is the manufacturer," explains Lindley. "That is an independent company again but, in some recent news, it is one third owned by the Renault-Nissan Alliance."
So what does this mean for the company, especially the UK manufacturer part? "It means we have two masters," explains Lindley, "But, luckily, they don't have conflicting agendas as both are looking to grow the brand in the UK," he says.
As for the influence of the Renault-Nissan Alliance on Mitsubishi since it bought shares two years ago, Lindley says more is going on behind the scenes than is obvious to customers, but that the alliance will have a significant impact on growing the brand from its current
1.1 million vehicles globally per year. "They are increasingly filling senior positions at Mitsubishi from the Renault-Nissan side, meaning a lot of people with experience of those two companies are bringing their experience. What we are seeing at the back of house is a lot of synergies on purchasing and engineering, and future platform sharing going forward."
Lindley says the alliance with Renault-Nissan will provide Mitsubishi with multiple benefits. One of these is more certainty when it comes to model plans. "On a local level, we're not always certain that the product cycle we have planned is going to go ahead but, with the alliance, that's changed and there's a lot more certainty," he states. The manufacturer has recently been able to compose a five-year model, which it has never really been able to do before. "We also share a media-buying company with them so when we want to buy ad space, we can benefit from a combined buying power of the alliance to get discounts on that - that's the power of a big organisation," Lindley adds.
Big product goals
For now, though, Mitsubishi's 2018/19 products are very much based on their own platforms and engineering. "It will be further down the line before we see co-developed products, but what we have to offer as a brand that's new is the Eclipse Cross crossover SUV and Shogun Sport, which comes from a similar platform as the L200 pickup. We're also refreshing the Outlander PHEV for 2019, which is a pure Mitsubishi product."
Due to its heavy focus on SUVs and pickups, the manufacturer has a relatively focused range compared with its competitors, and its bestseller in fleet is the L200, closely followed by the Outlander PHEV and Eclipse Cross.
Rob Lindley, managing director
While Lindley says the diesel segment might be slowing down a bit, in the big diesel SUVs it's still going strong.
He is particularly excited for the upcoming launch of the 2019 model year (MY) Outlander PHEV. "My 18MY performs well on my 30-mile journey to this office running at about 95-100mpg. It basically runs on electric nearly all the way but uses some petrol. However, I drove my 19MY here to this meeting and my mpg was 152. I think this is going to make it a big seller for fleets especially," he says.
The Outlander PHEV is an interesting car and a key model for Mitsubishi in fact, as it was the first of its kind to come to market in PHEV form. "It led the way towards electrification for the whole industry in my opinion," Lindley explains.
The car was especially important, he notes, as "before competitors had a chance to play catch-up, it was already out there selling away, and when competitors finally made rivals for it then, of course, we had that challenge on our hands," Lindley adds.
A fleet player
But it was a challenge the company was willing to accept, and it's still leading the way. It's the UK's bestselling PHEV model and Lindley explains that with all the tax changes coming in and different tax rates in 2020, Mitsubishi is actually ahead of the game once again. "We have a very active fleet department that works hard to make sure we're well represented on choice lists," he says. "As we bring more models out - in particular, PHEV - this will push us even further forward in the fleet market, and it was important to ensure the Outlander was still the PHEV of choice. The 19MY version has had its WLTP figures published already and it actually sits at under 50g/km despite the changes, and has a range of over 30 miles so the VED is low and the PHEV grant is maintained.
"What we're seeing is that some competitor models don't seem to be able to do that on the new WLTP so they have withdrawn those models or they're actually coming out at over 50g/km, whereas ours meets those regulations and is available now. We have a chance to do really well again here and we're talking to fleet operators about it now."
The manufacturer has been performing particularly well in fleet, and while the passenger car market for the calendar year was down 6%, its own passenger car market was up 22% year on year.
More to say
We also caught up with Clive Messenger, the brand's head of corporate sales while we were visiting Mitsubishi in Cirencester. Messenger works across retail and fleet, and says it's a good thing because he manages to balance both channels and look after dealers who he says are really important to its business.
In fact, Messenger highlights how important company car drivers are to Mitsubishi by explaining, "We want them to have a relationship with the local dealers and aftersales, so we got all of our dealers to sign up to a company car charter committed to giving company car drivers the same level of service as those retail customers."
While the brand may have been traditionally retail-dominated it's now a mix swaying more in line with the industry, standing year-to-date at 48% fleet, which he says the brand will aim to keep consistent over the next few years.
"When we launched the Outlander PHEV, it opened up a wider market for us to talk to, and new fleet customers, as well as taking the rest of the product range on a journey of heightened brand awareness with our customers," he says.
As for fleet initiatives, Messenger says the brand is launching a 24-hour test drive from September this year to ensure potential customers actually get to drive the Outlander PHEV before committing. "Having experienced the car myself, I know you have to drive it more than just a quick scoot around the block to really experience it. This initiative is open to retail and fleet customers but really aimed at company car drivers, giving them a chance to test drive it before they make that decision. The great news is that if they decide the car is perfect for them in terms of body size but they drive too many miles and can't charge it, then we have two other Outlanders - petrol and diesel - that they can choose as well," he says.
Messenger also explains that electrification is currently and will continue to be a key part of the Mitsubishi range in the future. "We will need to have PHEV and all electric offerings to be competitive," he says.
"What we must remember is that all three members of our new alliance with Renault-Nissan, including us, are the biggest drivers of EV introduction over the past ten years," he says. "Watch this space as where we're going next continues to be very exciting."