Mitsubishi 1999 Annual Report Download - page 6

Making it work, making it pay
4
and the introduction last year of the Space Wagon,
the Pajero Sport, and the made-in-Europe Space
Star lifted sales to a new record and helped MMSE
and NedCar meet their profit targets. And we can
look forward to better things in 1999 when the GDI-
powered Pajero Pinin, compact SUV, produced at
Pininfarina in Italy and based on the fast-selling
Pajero iO, hits the European market this autumn.
Mitsubishi truck sales in Europe grew 10% on 1997,
benefiting from our marketing alliance with Volvo.
In Australia, Mitsubishi brand vehicles sold in
record numbers for the second consecutive year, and
MMC is even able to report good news in Asia and
the ASEAN block, where the recent economic crisis
has badly hit sales almost everywhere.
In Thailand, our global pickup truck production
hub MMC Sittipol Co. moved into the black thanks to
strong export growth assisted by the weaker Baht. In
Taiwan, strong sales of the Freeca multi-purpose ve-
hicle series and the introduction of the new Galant
model saw Mitsubishi brand sales rise by 3% to
maintain leading share for the second year in a row.
In the Philippines, Mitsubishi brand regained lead-
ing share for the first time in nine years.
The automobile industry has witnessed some ma-
jor changes in the last year, with regrouping on a
global scale. Stormy the seas may be, but our ship is
sound and we see no reason to give ear to those
sirens who point to equity alliances as the only safe
harbor. I am willing, however, to consider any oper-
ational alliance that brings win-win benefits.
Our Global Partner Alliance strategy brings us
added marketing strength, reduces costs and im-
proves efficiencies through operational and develop-
ment ties. This may be seen in our Netherlands Car
B.V. (NedCar) production joint venture, truck mar-
keting, and truck development ties with Volvo; in our
technical assistance ties with Peugeot S.A. and with
Hyundai Motor Corp.
Ours is an industry of scale, but the merits of
scale do not extend ad infinitum. Beyond a certain
size, growth realizes no additional merits in terms of
production costs, and results in an organization of
mammoth proportions; one that gets bogged down in
bureaucracy and other efficiency-crippling re-
straints. This is quite the opposite tack from the one
we are on today, as RM2001 pilots our metamorpho-
sis into an organization that is lean and nimble. My
philosophy has always been to get our operations
back on track before seeking major growth; to ex-
ploit the advantages of our size—large enough for
leverage, small enough to be exciting, agile, speedy.
As if to symbolize the new dynamism driving us,
in a wonderful display of teamwork, determination
and superior engineering, MMC won seven out of 13
World Rally Championship events last year to take
manufacturer honors for the first time.
So, if I am happy about our performance in fiscal
1998, I am really enthusiastic about our prospects
for fiscal 1999 and the millennium. MMC is meta-
morphosing: driven by the corporate ideal of earn-
ing ongoing customer brand loyalty; piloted by
RM2001. The company is leaner, more focused, more
confident. The GDI engine gives us a decisive com-
petitive advantage that is enabling us to gain market
share, and to build profits on. As environmental
awareness and legislation increases, this edge we
enjoy can only grow in potency. Witness the situation
in Japan, where our low-consumption GDI models
already attract sales-boosting tax advantages.
We have caught a wave, and the transformation-
in-progress to higher business and operational effi-
ciencies world-wide will ensure we stay on it.