Mitsubishi Motors Corporation (MMC), the Japanese automobile giant has decided to set up a global hub in India to manufacture small cars. As per reports, the company will tie-up with Suzuki Motor Corporation and Nissan Motor Limited for this project. In terms of sales, Mitsubishi is lagging behind its Japanese competitors as it sells only 4,000 vehicles annually. At present, the company is identifying opportunity to start manufacturing its 1.2-litre small car, ECOCAR Mirage in India on its own.
For the same purpose, the company is reported to have set up another plant, which will start functioning from April. Entering into a licensed agreement with C K Birla-promoted Hindustan Motors (HM), the company has produced several SUVS like Pajero, Outlander, and the Montero including executive sedans like Cedia and Lancer. At present, the car maker does not have any small car in its portfolio. Seven manufacturing facilities of Mitsubishi are based across Netherlands (Europe), Japan, Philippines, North America and Thailand.
In 10 countries, the car maker has 11 joint ventures for manufacturing commercial vehicles. Executive officer and corporate general manager (Asia & ASEAN), MMC, Masahiko Ueki, said, “We will commence production of our global small car Mirage from April in Thailand. We are exploring the possibility of a second manufacturing site for the car in India.” He further said that final decision will be taken after looking at the prospects in countries like Indonesia and Malaysia.
Ueki however did not comment anything regarding the investment target for the second plant of Mitsubishi. He mentioned that 40 billion yen (nearly Rs. 2,400 crore) has been spent by the company to set up a facility in Thailand to produce 100,000 units of the small car.
Along the lines of the project, the company plans to enter the small car segment in India. Ueki added, “India is a big market for hatchbacks and sedans and we would like to enter the segment. One possibility is to introduce the Mirage in India. We can also have a sedan based on the same platform. But to price these products competitively, we need to have some volumes and a strong distribution network, which we are trying to build through our existing products.”
In India, 70 per cent of vehicle sales come from the small car market, where the company has no presence. “We can also export small cars from India to neighbouring countries,” said Ueki. Questioned whether, the new plant will be established in association with partner Hindustan Motors, “Ueki answered,” Going on our own is also an option. We do not know if our operation with Hindustan Motors is good or not for the future. So, we are looking at all options.”
Market share of Mitsubishi, which is less than one per cent in India, has been affected by absence of a small car. Toyota and Suzuki, which have both small cars have market share of 6 percent and 40 percent respectively. However, the company has taken a positive step to boost its sales in the SUV segment in India by launching an upgraded version of the Pajero
