Mitsubishi Motors rightly seeing new opportunity in Europe

Following reports that Mitsubishi Motors is considering a reversal of its decision to pull back from Europe and have its cars made at a Renault plant in France;

David Leggett, Automotive Analyst at GlobalData, a leading data and analytics company, offers his view:

“The pandemic is resetting automakers’ strategic compasses in many ways and creating a more dynamic and fast-moving landscape. While retrenching strategies that focus on bottom lines are one way that they are approaching business plans, new opportunities can also be thrown up – as these reports suggest.

“Alliance partner Renault has spare capacity at French factories that can be used for such a project, which would raise factory capacity utilization and bolster jobs – which is bound to please the French Government, still a major Renault stakeholder.

“Mitsubishi Motors could gain a European production base at very low cost and use that to supply the rebounding European market with in-demand models via a trimmed down retail network backed up by more direct-to-customer online sales.

“Moreover, Mitsubishi may also be reviewing its decision to completely exit Europe’s market as some dealers plead for new product. The Mitsubishi Outlander SUV has just been renewed and the plug-in hybrid version was a top seller in the segment in Europe.

“Deciding to eventually walk away from Europe’s market may already look a little hasty. Making more of the Alliance with Renault and Nissan will also play well with Mitsubishi’s board members – though they will be aware of the political backdrop and anxious to avoid accusations that they have been primarily suckered into protecting French jobs.”

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