Taking the helm of Mitsubishi Motors Corporation (MMC) from Chairman Osamu Masuko, former Managing Director Tetsuro Aikawa has a daunting challenge ahead of him as Chief Operating Officer of MMC.
Mitsubishi's worldwide sales numbers have been on a slump in that past few years, putting it under heavy scrutiny from its shareholders, the three Mitsubishi group companies — Mitsubishi Corporation, Mitsubishi Tokyo Financial Group Inc., and Mitsubishi Heavy Industries.
Yet Aikawa, who spent most of his 36-year stint as an engineer in charge of product development, has a plan to get MMC out from under the thumbs of its largest shareholders. He has expressed commitment to Masuko's 3-year business strategy, which focuses on SUVs and e-vehicles marketed towards emerging markets, as well as improving overall quality of Mitsubishi vehicles.
AutoIndustriya.com has had the fortune of sitting down with the COO at the recent Tokyo Motor Show to get a glimpse of his plans for the future.
AutoIndustriya: Mitsubishi has been shifting its production focus, decreasing in some countries and increasing in others. What is the strategy behind this?
Tetsuro Aikawa: First of all, concerning the production base, we will concentrate on Japan and ASEAN countries like the Philippines, Thailand, Indonesia, and China and Russia. There will be a shift in production base, focusing on growing markets.
We are ending production in the US. For the time being, we have no plans to resume production in the US. Though we stopped production, we will continue sales there. Sales are growing and we will be exporting vehicles from Japan and ASEAN to the US.
We see China and Russian markets to grow too.
As to what kinds of vehicles, we will be producing SUVs; focusing on electric-powered vehicles like EVs and PHEVs. As for the ASEAN markets, we know that sedans and hatchbacks are still a growing market, so we will focus on that too as well.
AI: Can you elaborate on your plan to produce electric vehicles?
TA: We currently produce two types of electric vehicles: EVs and PHEVs. Last year, we sold 1,800 EV units in Japan. We have sold 3,000 overseas.
The EV market is not so big, but the PHEV, which we introduced two years ago, is growing. As for the sales volume of PHEVs, in Japan, we sold 9,000 units. In the world, we sold 35,000 units. Our worldwide forecast for this year is 45,000 PHEV units.
We feel that PHEVs can be the pillar of our business. We haven't given up entirely on EVs. The battery life, as well as the performance will increase, and cost will dramatically decrease.
AI: When do you see EVs becoming mainstream?
TA: We foresee that, after 2020, there is going to be an increase in the demand for EVs and PHEVs. Compared to last year's forecast, it will be five times as much. There will be a demand for about 2 million units, by 2020.
One of the reasons is, beyond 2020, especially in Europe, there will be very stringent gas and CO2 emissions reduction regulations. EV and PHEV will be a necessity to meet these regulations. This is not just for Europe. I believe even ASEAN will be more stringent with emissions. It's true of the Philippines as well as Indonesia and Thailand. The traffic congestion in the metropolitan areas is becoming very serious. Therefore, I strongly feel that the need for electric vehicles, which do not produce much CO2, will be high.
AI: Right now, the PHEV and Evs are not offered in the Philippines. What's needed to make them a viable model to be sold in the Philippines?
TA: In order for the PHEV and EV to be popular in the country, there are items we need to focus on: charging infrastructure, cost, and running distance (how far one charge can go).
For charging and running distance, the solution will be PHEV. First of all, PHEVs can be charged at home, like a household appliance. Once electricity runs out, it can be charged by the petrol motor. The running distance is equivalent to a regular gasoline engine-powered vehicle.
For EVs, it's quite different. You need a quick charge infrastructure. We need that country's government's support or subsidy to build charging stations and make EVs popular in that country. We believe that, more than EV, PHEV will be more viable for the consumers.
We've evaluated the price of PHEVs in the ASEAN region. If people start to accept the price, realize that it is worthwhile, in spite of the difference from regular models (and without government subsidy), I think this can become popular. We will be able to sell it.
AI: That may be some years away, so what's the more immediate strategy for the ASEAN region?
TA: In Thailand, we have the eco-car project. This program involves the production of the Mirage and Attrage (called Mirage G4 in the Phillippines). We're selling and exporting these vehicles, not only in Thailand, but in ASEAN, US and Europe.
For the Philippines, we have great expectations for future growth. Last year, the Philippines ranked no. 9 in terms of sales volume in ASEAN. The sales in the Philippines last year, totalling 50,000 units, was a record high. From April to Sept. of this year, only halfway through the fiscal year, the sales have been going well. In terms of sales volume, the Philippines ranks no. 7 in ASEAN.
The Comprehensive Automotive Resurgence Strategy (CARS) program has been proposed and, through this program, we would actually like to produce small cars in the Philippines. It's still under consideration.
AI: There's a lot of talk of EVs and PHEVs, but little talk of performance vehicles, particularly like the Lancer Evolution series. What will be replacing it?
TA: We're not thinking of a direct successor of the Lancer Evolution. The Lancer Evolution needs to have a sedan which will be its basis. In the future, the demand for sedans will not grow. Because there's no demand for the sedan, we have no plans to develop the sedan anew.
However, concerning the technology used in the Evolution, like 4WD and S-AWC (Super All-Wheel Control), these can be incorporated into the Outlander PHEV. The motor used in the PHEV is high performance, so in the future, this can be improved more.
Therefore, in the future, these types of high performance vehicles could be realized in PHEV SUVs. I strongly feel that this is indeed an “Evolution” vehicle which takes into consideration the needs of the environment. We haven't started on concrete development, but this is what I have in mind for future development.