Mitsubishi moves on from its dark days
Rob Maetzig talks to the globe-trotting head of Mitsubishi Motors, Trevor Mann, who has played a major role in turning around the company’s profits.
The man who has played a pivotal role in dramatically returning Japanese car manufacturer Mitsubishi to profitability says he is delighted with the part New Zealand is playing in the turnaround.
In fact Mitsubishi is so impressed, that for the first time in almost a decade it has appointed a New Zealander as president and chief executive of Mitsubishi Motors New Zealand Ltd.
All this was revealed during a whistle-stop visit to Wellington by one of the world’s leading motor industry executives, Englishman Trevor Mann.
Up until last year Mann had spent 33 years with Nissan, rising from working in the manufacturing department at the brand’s United Kingdom assembly plant at Sunderland, to being appointed Nissan’s global chief performance officer in early 2014.
Then in October last year, after Nissan took a 34 per cent stake in financially troubled Mitsubishi Motors and assumed effective control of the company, Mann was made chief operating officer of Mitsubishi Motors.
Since then Mann has played a major role in turning Mitsubishi around – thanks to a series of costsaving measures it has gone from recording a US$300 million (NZ$421.6m) loss in the opening six months of the last fiscal year, to returning a US$340 million profit in the second six months.
Mitsubishi is now part of the global alliance with Nissan and Renault, which is the world’s biggest automotive group with annual sales surpassing 11 million vehicles.
And although in terms of global sales Mitsubishi is very much the junior partner in the alliance, in New Zealand it is the other way around – year to date this year Mitsubishi has a 7 per cent market share, Nissan 5 per cent, and Renault hardly figures in total vehicle sales.
This means that despite the small size of New Zealand’s new vehicle market, this country has played a significant role in Mitsubishi’s turnaround, said Mann.
‘‘Mitsubishi has a presence in about 160 markets, and in terms of numbers of vehicles sold New Zealand is running 14th,’’ he said. ‘‘The brand is performing very well here – in New Zealand it’s the biggest brother in the alliance. This year it is achieving 27 per cent growth year-on-year, in a market that is growing 8 per cent.
‘‘And this has been achieved at a time when no new product has been introduced. To me, that shows the importance of any car company having a fundamental business model that is robust and sustainable.’’
Mitsubishi Motors NZ’s solid business performance has resulted in the appointment of the company’s current chief operating officer Warren Brown as president and chief executive. Brown takes up the position on October 15, and MMNZ joins Australia and Canada as the only countries that do not have a Japanese representative in the top role.
‘‘Apart from the fact the New Zealand operation is performing well, I believe in localisation of management anyway,’’ said Mann.
‘‘It’s important Mitsubishi is a diverse company at all levels, with no glass ceilings. That way it can be a truly international company.’’
Since assuming his new role, Mann has spent an enormous amount of time on the road, visiting Mitsubishi operations throughout the world.
His first visit to New Zealand lasted just one day, a good portion of it spent talking to MMNZ staff and giving them a first look at the next new Mitsubishi model to come here, the Eclipse Cross SUV that will enter the market in the new year.
He even popped into a couple of Mitsubishi dealerships in the Wellington area.
‘‘I like to go to the actual places – to talk with the staff and to touch the metal. That way you really find out about what’s good and what’s bad,’’ he said.
When Mann joined Mitsubishi, an early decision was to focus on five key subjects:
First was motivation. There was a considerable amount of anxiety as a result of Mitsubishi joining the alliance, and staff had to be assured that their futures were safe.
Second was direction. Staff needed to be confident of the business direction Mitsubishi wanted to take.
Third was alignment. It was made clear that if the entire Mitsubishi operation – the company, its distributors and dealers – weren’t aligned, it would be difficult to progress.
Fourth was focus. Mann said staff needed to be given a target to chase, and the immediate target was to return to profitability. ‘‘To go from a $300m loss to a $340m profit inside a year was a pretty audacious target, but we did it. We really needed to focus to achieve that.’’
Fifth was discipline. ‘‘When I joined, the people at Mitsubishi were a bit punch-drunk. Particularly in Japan, where staff had been hard-hit by the fuel economy scandal (Mitsubishi had been found to be using inaccurate test methods to provide wrong information on fuel consumption) you could see there was a lack of belief and motivation.
‘‘So we said there was no golden nugget – staff needed to roll up their sleeves and be disciplined. We needed to install rigorous processes, sit down every month and review them and set forecasts for the following month.’’
Mann said he is pleased with the progress that has been achieved.
‘‘Mitsubishi is very much the small partner in the alliance. But we do add more than one million vehicles to annual global sales, and the brand boasts expertise in SUVs and plug-in hybrid technology, which can be shared with the other members of the alliance. And Mitsubishi in turn gets access to other technologies and benefits from economies of scale.
‘‘All this means that Mitsubishi is now in a position to be able to punch significantly above our weight.’’