Mitsubishi 2007 Annual Report Download - page 24

MITSUBISHI MOTORS CORPORATION Annual Report 2007
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North America
With annual demand of around 16 million units,
the huge U.S. market assumes the same importance
as Japan in the Mitsubishi Motors Revitalization
Plan. In January 2006, MMC appointed a new man-
agement team at Mitsubishi Motors North America,
Inc. (MMNA) and also dispatched management
personnel from Japan to put in place an organiza-
tional structure that is responsive and strongly
linked to Head Office in both production and sales.
Since fiscal year 2004, MMNA has focused on nor-
malizing sales by reducing sales incentives to appro-
priate levels, lowering the ratio of fleet sales, and
promoting inventory management, in order to correct
its past sales policy of emphasizing sales volume.
These sales policies have been steadily producing re-
sults. In addition, since fiscal year 2006, MMC has
been taking initiatives such as strengthening sales
support programs and nurturing sales capabilities,
with a view to forging stronger relationships of trust
with sales companies. As the second phase of these
initiatives, we are now focusing on developing a stron-
ger brand based on the launch of new products poised
to become future mainstay models.
Overview of Fiscal Year 2006
Retail sales in the North American market* totaled
164,000 units in fiscal year 2006, increasing 5.1%
year on year. Retail sales increased for the first time
in five fiscal years after falling consecutively since
fiscal year 2002. This improvement reflected a
major drive to normalize sales and the roll-out of
new models.
The active launch of new models was hugely suc-
cessful. One of those models was the new
Eclipse
Spyder
, which went on sale in the U.S. market in
April 2006. This was followed in November 2006
by launching the new
Outlander into the expanding
compact SUV segment. In March 2007, the new
Lancer was rolled out in the North American market
first, before any of MMC’s other markets.
Fiscal year 2006 marked the 25th anniversary of
Mitsubishi Motors’ entry into the U.S. market. The
Company capitalized on this opportunity to implement
an ambitious sales promotion and advertising drive
in conjunction with a 25th Anniversary Campaign.
MMC drove home its strong commitment to U.S. op-
erations backed by the full resources of the company,
sending a clear message to customers, dealerships
and employees that would deepen their understand-
ing of our resolve. Furthermore, top management
visited dealerships in each region and held a series
of discussions on sales improvement initiatives, and
presented necessary support measures such as sales
training programs and new incentive plans. These
visits helped to improve communication with
dealerships and further raise their motivation.
Overall, net sales in North America increased
1.9% year on year to ¥423.6 billion. Operating
Net Sales
(¥ billion)
Operating Income (Loss)
(¥ billion)
Retail Sales
(Thousand units)
*MMC revised targets for fiscal year 2007 when it released fiscal year 2006 full-year financial results on April 26, 2007.