AM Online

Mitsubishi: Fortunes restored after year at mercy of yen

 

 

It has become the fastest growing car brand in the UK in 2013, a year that has seen a 70% increase in quarter one marketing spend and continuing campaigns in newspapers, magazines and outdoor sites.

This activity has a dual purpose: to indicate that there’s action underway with Mitsubishi, and to clearly state key selling points of its two new launches: Mirage has £0 road tax, 67 official mpg, starts at £7,999 and has a £100 per month PCP offer; Outlander has selectable 4WD, seven seats, 50+mpg and £125 road tax.

Brand’s biggest opportunity


 

Bradley said the ASX crossover model is probably the brand’s biggest opportunity.

Its potential since launch has been frustrated by the exchange rate, which led to mixed restrictions on what dealers could sell, but now those restrictions have been lifted and a significant marketing push is coming in June.

The head office has also restored full incentive margins back onto more cars – the supply issues of 2012 had led it to apply fixed margins to many cars.

A lot of the marketing activity from Mitsubishi Motors in the UK is done in digital media.

18,000-unit target for 2013

The big challenge for 2013 will be sales capacity in the network.

Because Mitsubishi’s dealers pared back their staffing levels last year, they now need to increase their capacity by looking at how many extra people are needed to manage the increased volume.

The importer has a target of 18,000 units this year, including pick-up trucks, which will mean continuing to deliver the 50% growth the brand has enjoyed early in the year.

Yet dealers are running ahead of plan so it could become 20,000, which Bradley said would be “an incredible effort, absolutely amazing”.

While there are a couple of open points to fill in cities such as Manchester and Liverpool, Bradley is not looking to expand the network as the priority is to put more volume through the existing dealers.

He wants to get the average dealer new car/pick-up throughput up to 150 – last year it slumped to around 50-60 units – which will ensure many of them will make a decent return.

The ideal volume for Mitsubishi in the UK is 25-30,000 units, of which a third would be its pick-ups, which ensures good business for both head office and the dealers, and that could be achieved in 2015 on the back of good products and strong dealers.

The network has achieved 38,000 annual units before, so the capability is there already, he added.

Mitsubishi’s UK sales are heavily weighted towards private consumers.

However, as a brand with all-wheel drive DNA it also has appeal to certain fleet and contract hire customers.

Thanks to its own Specialist Vehicle Operations centre in Cirencester, it is able to equip and modify vehicles to specification for police services and government agencies and this means that when it competes for tenders the convenience and expertise will factor as well as the price.Aftersales driving loyalty

One of the crucial pillars which supported the UK’s Mitsubishi dealers through a tough 2012 was aftersales retention.

 

A Mitsubishi Service Plan (MSP) was launched five years ago after the brand’s analysis of new car buyers’ loyalty showed that by year three it had dropped to between 40-50% from 90% in year one. 
Now 91% of customers buy the plan when they buy their car and loyalty at the three year service is above 90%.

Bradley is also proud that Mitsubishi’s 154-strong network, most of which are owner-driver businesses, gets a 73% rating on Net Promoter Score.

Electronic vehicle health checks are encouraged.

Bradley said it was a challenge because some aftersales staff felt uncomfortable making sales, but in-house training has been laid on to overcome this and is working quite well.

For 4+ year cars the company supports a Value Servicing programme, priced from £100 up to £150 for a Shogun, which is focused on the basics such as oil changes, fluid top-ups and brake checks.

 

 



Click here for manufacturer best practice and procurement insight

If you are not a registered user your comment will go to AM for approval before publishing. To avoid this requirement please register or login.

Login to comment

Comments

No comments have been made yet.