10 March, 2021

Mitsubishi collaborates with Renault for supply to European market

Mitsubishi has formed an agreement with Renault that will allow it to offer additional models in the European market. It will procure OEM-model vehicles from the French company. These will be tried-and-tested platforms with clear sales performance that already meet continental regulatory requirement. Last year Mitsubishi declared it would freeze car development for the European market as part of a new strategic plan.

Under the new agreement, the two ‘sister models’ will be built in Groupe Renault plants from 2023, and while sharing platforms, will feature ‘differentiations reflecting the Mitsubishi brand’s DNA.’

The Japanese company will offer three vehicles to selected European markets. Mitsubishi will continue to sell its newly-launched Eclipse Cross PHEV (plug-in electric hybrid) alongside the new models. It hopes the efforts through the Renault-Nissan-Mitsubishi alliance will allow it to remain competitive on the continent.

‘I am very happy to see Mitsubishi Motors building a new line-up in Europe. The Alliance aims to enhance competitiveness and enable more effective resource sharing for the benefit of all three companies. Our approach is collaborative, relying on mutual respect, with a clear intention to boost the performance of each company, allowing individual companies to capitalise on their own strengths, avoid duplication of resources and improve efficiencies,’ commented Jean-Dominique Senard, chairman of the Alliance operating board and Renault.

Product freeze

Instead of development cars in Europe, Mitsubishi had said it would focus on the ASEAN (Association of Southeast Asian Nations) region, increasing its market share to more than 11% in this area before developing the business in Africa, Oceania and South America.

The announcement that Renault will build two models does not end the European product freeze. With no significant investment from Mitsubishi, Renault will conduct development and manufacturing. Nevertheless, the news that Mitsubishi will have two additional models in its European offering in two years’ time means the company can retain a presence should it look to unfreeze its plans.

‘Mitsubishi Motors has been implementing structural reforms in Europe, and our decision to freeze new-car development for the European market, announced in July 2020 in our mid-term business plans, remains. However, the OEM supply agreement will provide us with a solution to offer new products developed and manufactured in Europe– alongside our ongoing aftersales business,’ said Takao Kato, CEO of Mitsubishi Motors.

Strength of the Alliance

Following the Carlos Ghosn saga in 2019, there were questions around the future of the Renault-Nissan-Mitsubishi Alliance. All concerned companies have attempted to put this period behind them, employing new management and prioritising the strengthening of ties.

The economic impact of the COVID-19 pandemic has hit the automotive industry hard. This is the perfect test of the ‘new’ Alliance, with Mitsubishi, the smallest of the three carmakers in Europe, leaning on its French counterpart to continue with a presence in the market.

‘Our new approach within the Alliance, focusing on impactful and meaningful projects, is turning into reality. This pragmatic, value-driven initiative will make a difference in our plants, in our partner’s footprint and on the European streets. This is what the Alliance is meant for, and we are very happy, at Groupe Renault, to contribute to this new step in its history of cooperation,’ said Luca de Meo, Groupe Renault CEO.

No UK presence

Relying on Renault to build cars will keep costs down and Mitsubishi is lowering any potential spend further still by only committing to certain European markets.

This means there will be no right-hand-drive models produced. Mitsubishi will not be selling vehicles in the UK from autumn this year.

‘Mitsubishi Motors in the UK is progressing with its plans to sell the existing range of vehicles until the autumn. At this point, it will transition into an aftersales-only business to ensure the 400,000 Mitsubishi vehicles on UK roads continue to receive full support in terms of maintenance, spare parts, accessories, warranty and technical support,’ the company’s UK arm confirmed.