Mitsubishi 2004 Annual Report Download - page 8

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MESSAGE FROM THE PRESIDENT AND COO
As President and Chief Operating Officer of Mitsubishi Motors Corporation, I am ultimately responsible for the
Company’s operations—including development, purchasing and procurement, manufacturing, sales, quality assurance
and management—and take pride in leading a group of dedicated employees. Guided by the Business Revitalization
Plan, a three-year plan that commenced in fiscal 2004, the Company is making steady progress in its efforts toward self-
revitalization, including the strengthening of its financial position, thanks to the much appreciated understanding of all
concerned. The Business Revitalization plan provides a road map for the Company’s future. At Mitsubishi Motors, we
are unified in our commitment to achieving our objectives, and will implement essential measures to ensure a timely
arrival at our designated destination.
COMPREHENSIVE EARNINGS STRUCTURAL REFORM
Confronted by excess capacity in global automobile production, Mitsubishi Motors was unable to secure profitable
operations. In the past, in its effort to compete, the Company was forced to adopt drastic sales plans that gave scant
regard to risk and return. As a result, our products’ sales competitiveness and brand power suffered, and in pursuing a
policy of discounting and sales incentives, the Company fell into a downward spiral, in turn incurring heavy losses. In
order to break out of the root cause of this situation, the restoration of capacity commensurate with sales is essential.
The trimming of production capacity is under way on a global scale, breaking away from a preoccupation on vehicle
numbers to establish long-term profit structures. In overseeing the operations of the Company, I am confident
Mitsubishi Motors is unified in its commitment to ensure this plan is swiftly implemented.
In concrete terms, the termination of mass production at the Okazaki assembly line is being speeded up and the site’s
role will change to that of a pilot plant. This will leave the Mizushima plant and PMC, which produces the Pajero, as the
only production sites in Japan. Overseas, the MMAL engine plant in Australia will be closed by fiscal 2005, and the car
assembly plant will scale down annual production from the current 60,000 units to 30,000. Furthermore, production at
MMNA in the United States will be trimmed by changing from a double- to a single-shift operation. By so doing, produc-
tion capacity will be reduced by 17% and the utilization ratio expected to improve from 78% to 97%.
PRODUCT STRATEGIES FOR GROWTH
With concepts and styling that take the renaissance of Mitsubishi Motors’ DNA as their base, and that push the current
boundaries of technology, innovative automobiles are being created that embody the essential qualities of Mitsubishi
Motors. In order to bring these to fruition, I am pressing for two system reforms.
The first is the introduction of the PX structure. The model-specific PX has end-to-end product life cycle responsibili-
ty from the basic product concept stage to customer sales, quality follow-up and profits. Six PXs are already active and as a
result of the impact on overall product life cycle, will demonstrate efficiently and effectively the full-scale efforts the
I am ultimately responsible for the Company’s
operations—including development, purchasing and
procurement, manufacturing, sales, quality assurance
and management—and take pride in leading a group of
dedicated employees.
HIDEYASU TAGAYA
President and COO