LAS VEGAS - Even though Mitsubishi Motors Corp. is moving to slash its product offerings worldwide and cut costs, it will spend $1.4 billion on its U.S. core products over the next five years, executives told dealers here at their annual meeting.
In addition to major updates of existing models to better suit American tastes, Mitsubishi will enter the small-sport-utility segment in America in spring 2002 with an all-new, tailored-for-America vehicle, said President Katsuhiko Kawasoe.
Competing against the Toyota RAV4 and Honda CR-V, the Japan-built sport wagon will be based on an as-yet unidentified platform, either the next-generation Mirage or another platform that has not yet begun development. The vehicle probably will come only with a four-cylinder engine, a Mitsubishi source said.
'The addition of a fourth core product (in addition to the Galant, Eclipse and Montero Sport) will enrich our entire brand strategy, helping us to create new sales practices and increase our sales target to 300,000 units annually in 2004,' Kawasoe said.
To be considered a core vehicle by Mitsubishi, a vehicle needs to sell at least 40,000 units.
In other product news, Kawasoe disclosed that the next Montero Sport compact sport-utility will be built at Mitsubishi's Normal, Ill., factory. Unless Mitsubishi intends to add a truck platform to the factory's current model mix, that means the Montero Sport will be based on the next Galant.
Product planners and engineers have been wrestling with the Montero Sport's future.
Although the industry is moving toward car-based designs for sport-utilities, part of the Montero Sport's consumer allure has been the capability of its truck-based design. The decision to go with the Galant-based platform was reached only in the past few weeks, sources said. The redesign will come in the 2002 or 2003 model year.
Also, Mitsubishi executives said the redesigned Montero sport-utility will arrive in spring 2000 with a gutsier V-6. The current model is powered by a 3.5-liter V-6 that generates 200 hp.
The Montero redesign will be on a unibody platform that is two inches longer, three inches wider and two inches lower and has a two-inch longer wheelbase than the current body-on-frame vehicle.
Unveiled to journalists and analysts here, the new Montero is more squat and confident than the current tall Montero.
Styled and developed in Japan, the new Montero from the side looks like a big brother to the smaller Montero Sport. But moving around the front shows hints of the SST concept vehicle that bowed at the Detroit auto show in January.
Other changes for the new Montero include an independent front and rear suspension, with upper and lower control arms up front and coil springs in the rear. Front and rear stabilizer bars also are standard.
An electronically activated 'Active-Track' four-wheel-drive system is standard, while both a four-speed automatic and a five-speed manual transmission will be offered.
To appeal more to the soccer-mom crowd, the next Montero's sill height will be about two inches lower, making ingress and egress easier, while maintaining the vehicle's high ground clearance.
Mitsubishi hopes to sell about 25,000 units of the new Montero.
As for its two volume leaders, Mitsubishi will offer a convertible version of the redesigned Eclipse in spring 2000. And a wider Galant replacement, more in line with the Toyota Camry, is slated for 2002.
Some U.S. executives have voiced their dismay that the 2000 Eclipse was not allowed to be four millimeters wider to give it a more pronounced side-panel crease. The added width would have pushed the car into a more expensive tax category in Japan.
The decision to go with the narrower Eclipse was made even though Mitsubishi sells fewer than 1,000 Eclipses a year in Japan - and 55,000 in America.
Hiroshi Yajima, president of Mitsubishi Motor Sales of America Inc., vowed here that the era of decisions like that for American-market products is over: 'Gone are the days when we adapt Japan-market products and expect them to sell here.'