Mitsubishi 2008 Annual Report Download - page 26

24 mitsubishi motors corporation annual report 2008
Overview of Fiscal Year 2007 and Outlook for Fiscal Year 2008
Retail sales in the North American market totaled 172,000 units in
fiscal year 2007, increasing 4.7% year on year.
In the U.S., sales of the new
Outlander , launched in Novem-
ber 2006, and the new
Lancer , which made its global debut in the
U.S. in March 2007, posted strong sales. This supported faster
sales growth than in fiscal year 2006, which marked the first year-
on-year sales growth in five fiscal years. However, from the second
half of fiscal year 2007, falling demand stemming from the sub-
prime mortgage crisis and escalating sales competition resulted in
slower sales growth. As a result of this and the impact of a change
in the model mix, U.S. sales for the full fiscal year were largely the
same as the previous fiscal year. Meanwhile, Canadian sales rose
50% year on year due to strong sales of new models.
As a result of the above, net sales in North America declined
4.9% year on year to ¥402.7 billion. Operating income deteriorated
¥18.4 billion to an operating loss of ¥17.8 billion due to higher
selling expenses, including advertising costs, associated with the
launch of new models in North America, and to lower earnings
from the U.S. sales finance business.
In fiscal year 2008, MMC is targeting North American sales of
145,000 units, down 15.7% compared with fiscal year 2007,
North America
In fiscal year 2006, MMC appointed a new management team at Mitsubishi Motors North America, Inc. (MMNA).
฀฀฀฀฀฀฀฀฀฀฀฀฀฀฀฀฀฀-
forced sales support and worked to forge stronger relationships of trust with dealers. As a result, the North Ameri-
can operation had been improving, but the direction of the overall American market has become increasingly murky
due to the sub-prime mortgage crisis in the U.S.
฀฀฀฀฀฀฀฀฀฀฀฀฀฀฀฀฀-
forcing the sales network and bolstering the image of the Mitsubishi Motors brand.
including the impact of transferring sales figures for Puerto Rico
from the North American total to the Asia, ASEAN and Other
regions total.
Initiatives Under the New Mid-term Business Plan
In North America, stabilizing operations is one of the main themes
of the new Step Up 2010 mid-term business plan.
Sales of the new
Lancer , which were fully launched in April 2007,
made a strong start and remained healthy throughout the full fiscal
year, contributing to higher sales volume. The new
Lancer Evolution ,
rolled out in January 2008, became available with an optional auto-
mated manual transmission “Twin Clutch SST” in June of fiscal year
2008. Plans are to launch the turbocharged
Lancer Ralliart in autumn
as part of a program to further strengthen the new
Lancer series. In
this way, the
Lancer is fulfilling its role as a driver of the North
American business.
United States: Start Eclipse Exports to the Middle East,
China and Korea
In the United States, as part of its efforts to ‘build the foundations
for growth,’ MMC has started exporting the
Eclipse , which is
produced at MMNA’s plant in Illinois, to the growth markets of
Outlander