LOS ANGELES -- Randy Sears, president of Mitsubishi Motor Sales of Canada, abruptly resigned Tuesday, Aug. 31.
Sears, 51, reported to Finbarr O'Neill, CEO of Mitsubishi Motors America Inc.
Many more Mitsubishi employees in North America could leave the troubled company in the coming weeks.
Sales in both the United States and Canada continue to free-fall. Employees at the company headquarters in California expect widespread defections and layoffs among salaried employees in the United States as the company seeks cost cuts.
Sales plunged by 60.8 percent in the United States in August to 10,721 units. Every nameplate was down by more than 50 percent from August 2003 to August 2004 except for the Lancer Evolution, which was down 39.4 percent.
Canada's 52 dealers sold only 835 units in August, a 25.6 percent drop from the year-ago month.
Dennis DesRosiers, an independent automotive analyst in Toronto, said he played golf with Sears the week before his resignation.
"You could tell he was troubled," DesRosiers says. "The Canadian operation was a very difficult environment to work in."
He says dealers in Canada struggle with plummeting sales like their U.S. counterparts. But Canada has too few Mitsubishi vehicles on the road to generate sufficient service and repair revenue.
"Dealers are critical to success," DesRosiers says. "If you can't get the dealers profitable, how do you manage to be successful in the longer term? And how to you attract new dealers?"
Mitsubishi's official response was that Sears left to pursue other opportunities. He joined Mitsubishi in 1998 as director of retail operations for the North Central region in the United States. He was tapped to run Canada in 2002 by then-U.S. CEO Pierre Gagnon, when Mitubishi's sales and stature were rising in the United States.
In an April 2002 press release, Sears projected that Canada would have 150 Mitsubishi dealers by 2007. He also projected sales of 20,000 units in 2003 and at least 37,000 in 2007. Sales were 3,233 in 2002 and 14,122 in 2003.
Tom Fisher, sales manager at Orr Mitsubishi in Sarnia, Ontario, believes Mitsubishi can survive in Canada if management receives more autonomy.
"Randy Sears had a trying tenure as president, but he was a committed man," Fisher says. "We need to be able to run our own show. This is a different market than the U.S., but I believe we will survive."
Mitsubishi spokeswoman Sandy Di Felice says the company will replace Sears. She says Tony Laframboise, the national sales manager in Canada, will take on the added responsibility as interim managing director until a new CEO is named.