TOKYO/BEIJING -- Scandal-hit Mitsubishi Motors Corp. said on Wednesday it would begin selling a new minivan in China in October as it bets on the world's fastest-growing market to make up for dismal sales everywhere else.
Last month, Japan's only loss-making car manufacturer announced a revival plan that positioned China as its main hope for survival as monthly sales plunge by double digits in its key U.S. and Japanese markets due to a battered brand image.
Mitsubishi Motors, held 37 percent by DaimlerChrysler AG, forecast sales of more than 200,000 units in China for the current business year to next March, targeting a further rise to 310,000 in 2008-09.
"China is the second-most important region for us after Japan," senior executive officer Akira Kijima told reporters in Beijing.
Last business year, its Chinese sales surged 66 percent to 151,000 units thanks to strong sales of the Lioncel sedan and the Pajero sport utility.
To build on the growth, Mitsubishi Motors said it would launch four new models in China during the 2004/05 business year, including the Grandis minivan on display at the Beijing auto show over the next week. The model debuted in Japan in May 2003, and went on sale in Europe this April.
Japan's fourth-largest auto maker will also add a total 11 new models in China by March 2008, while increasing the number of showrooms to 500 by the following year from 60 now.
"The Grandis ... will play a key role in the company's efforts to build up the Mitsubishi Motors brand and bolster its product lineup in China," the company said in a statement.
Mitsubishi, however, is likely to face tough competition from stronger U.S., European and Japanese rivals as they offer new models at a faster clip for China's increasingly choosy customers.
Last month, Mitsubishi secured $4 billion in emergency financial aid to help fund the development of new cars and clean up its balance sheet, but has been hit by renewed image problems after more cases of recall cover-ups recently came to light.
The scandals have battered sales, with the Grandis selling just 401 units in Japan last month, down 86 percent from a year earlier and far short of the monthly target of 3,000 units.
While Mitsubishi Motors' brand has yet to suffer visibly in China, analysts say the widespread use of the Internet for information could herald a similar fall in sales there too.
Asked about plans for new investments in China to fuel the expansion, Kijima said that would be decided "some time in the future".
He added that Mitsubishi was looking into the idea of expanding cooperation with Southeast Fujian Motor Corp (Soueast), a local joint venture half-owned by Taiwan's China Motor Corp. that builds the Lioncel.
Mitsubishi owns 20 percent of China Motor, which is helping its Japanese partner by buying 10 billion yen ($91 million) of preferred shares as part of the rescue scheme.