Mitsubishi exec asks Japan for more marketing cash
Photo credit: HANS GREIMEL
LOS ANGELES -- Mitsubishi Motors North America is asking its Japanese parent to more than double the U.S. marketing budget next year to launch reworked vehicles and help the struggling brand regain traction.
Masatoshi Hasegawa, executive vice president of sales and corporate strategy for Mitsubishi Motors North America, said he believes the brand needs to "at least double" its U.S. marketing budget for the fiscal year that begins April 1, 2013.
The funds are needed to market the freshened 2013 Outlander Sport on sale now and the redesigned 2014 Outlander crossover that arrives stateside next summer, Hasegawa said.
Mitsubishi's agency is 180 LA.
The Outlander Sport, which seats five, shares its platform with the 2014 Outlander, which will seat seven.
Hasegawa: The brand needs to “at least double” its U.S. marketing budget for the fiscal year starting April 1.
"I've asked to increase the budget substantially," Hasegawa said. "We'd like to concentrate on American production [of the Outlander Sport] and the next-gen Outlander, which will be the two major models in our lineup."
Hasegawa said he has petitioned Mitsubishi Motors Corp. officials in Japan for the increase. Budget decisions for the upcoming fiscal year are expected to be made in early 2013.
A source familiar with the situation says Mitsubishi's current total U.S. marketing budget is a modest $85 million. For comparison, major automakers in the United States often spend $100 million to launch an important redesigned vehicle.
Boosting sales of the two crossovers is critical to Mitsubishi's plan to increase U.S. sales to 80,000 units in its fiscal year ending March 31, 2014. Through November, the company's U.S. sales dropped 28 percent to 53,677 units. Meanwhile its U.S. lineup has shrunk to four models from eight, and the i-MiEV electric small car has flopped.
Hasegawa said the company hopes to sell up to 15,000 units of the redesigned Outlander annually vs. the 7,112 Outlanders sold in the United States through November.
"Compared to the former Outlander, we've made a significant improvement on the car itself, and we're moving upscale and trying to adapt our production to the competition," Hasegawa said.
Mitsubishi also plans to launch a minicar, now sold overseas as the Mirage, next fall in the United States. Hasegawa said Mitsubishi would like to sell 500 to 600 units every month; the minicar may be sold under a different name here.
He said the company plans to start selling a plug-in hybrid Outlander in January 2014.
Hasegawa acknowledged that the minicar segment, which includes such cars as the Chevrolet Spark and Fiat 500, has caught on slowly in the United States. Mitsubishi expects demand for small, basic vehicles with good fuel economy to grow.
"These kinds of small cars with very good fuel economy will be in demand," Hasegawa said. "We need to be there."
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