Mitsubishi had quietly racked up a seven-year streak of U.S. sales increases when the chaos of 2020 brought an end to it.
But dealers believe a bevy of upgraded products have the brand positioned to rebound from last year’s 28 percent drop, said Richard Nisbett, the Mitsubishi National Advisory Board chairman. Nisbett owns Daytona Mitsubishi in Daytona Beach, Fla.
More help for the lineup is on the way this year in the form of the redesigned Outlander midsize crossover, which will be the first Mitsubishi built on a platform from the Renault-Nissan-Mitsubishi alliance.
Nisbett, 59, spoke with Staff Reporter Vince Bond Jr. about Mitsubishi’s prospects for 2021 and its product portfolio. Here are edited excerpts.
Q: On the product side, how do you feel about where the company is right now?
A: Every model’s been either upgraded or it’s going to be all-new. Would I like a deeper bench? Absolutely. But it’s exciting to see the investment that Mitsubishi’s putting in, in terms of freshening some of the existing models, and then, of course, we’ve got the all-new Outlander coming. It’s exciting because it’s just a completely new model. And that is the first model that’s from out of the alliance. That’s built on the common chassis with the Nissan Rogue. I had a chance to preview that model. It’s just next level in terms of the design, the fit, the finish. I just think it’s going to be a game-changer for the franchise.
Do you think everything is going according to plan with the alliance?
I don’t. I was a big Carlos Ghosn fan. I’m not privy to all the behind-the-scenes stuff, but I’m just talking about from a standpoint of a visionary and a leader and an execution guy, I thought he was pretty incredible. Nissan has its own issues right now.
That has reshaped their model of business from pure volume to realigning. My hope is that might give more opportunity for us to share stuff. If Nissan’s not absorbing all their volume within their own dealer [network], it would make sense to share some of their factory volume or model lines with a sister company.
Do you feel Mitsubishi’s leadership is stable? There’s been some turnaround at the top with Fred Diaz leaving the CEO job in North America.
I do. With every change, there’s some adjustment, and the current leadership’s made some tough decisions that have ultimately been the right decisions that help the dealer. For instance, when COVID hit, they canceled several months of committed product that the dealers had for a couple reasons. One, it wasn’t just the knee-jerk thing, it was Mitsubishi dealers had the highest days in stock of vehicles, I believe, of any brand. To help realign that and also to try and anticipate COVID, they canceled it. That has gotten the dealer body’s inventory levels back to a manageable level, which is a good thing. That’s one example of how the leadership has made a tough call.
There was some talk a couple of years ago of Mitsubishi putting together some regional sales units. Did that go through as planned?
That was to Fred’s credit. Fred Diaz was instrumental in opening the regions back up. It’s good. There’s a lot more communication in terms of the field personnel being able to respond and get answers for them. Having a regional manager to answer to has been a good thing.
What can the company do to improve sales of the Outlander?
It is hard because we’re a niche player. We’re small. You can’t outspend the big boys. But the product drives everything, right? People will find you absent advertising if you got a good-looking vehicle that’s priced right. It’s just a great value statement. Just a bulletproof Japanese car that’s priced right.
When you talk with my customers, current Mitsubishi owners are just incredibly loyal to the brand because they know from prior experience how good the product is, but it’s educating the people that aren’t familiar with the brand. They don’t necessarily have a bad opinion of Mitsubishi, they just don’t know about it. That’s my experience. It’s our job and the dealer body’s job to get the word out there. I think with the all-new product coming, I think that’s going to go a long way.
Even something as simple as you’re at an intersection and you look over and you see a good-looking SUV, and you’re like, “What is that?” Next thing you know, you’re looking at the emblem and going, “Wow, that’s an Outlander. Mitsubishi, huh?” It’s definitely a challenge for us just because the volume only dictates a certain amount of marketing budget. Our emphasis is leveraging that digital world for the introduction and exposure of the brand because it’s just the most economical way to get in front of people.
Mitsubishi had been marketing through sports events over the years such as NBA games. Do you think that has paid off when it comes to awareness?
It is a difficult thing to measure in terms of feet through the doors where I’m measuring. Any chance of awareness is good. I’m not privy to the dollars and cents to say is the juice worth the squeeze because I just don’t know the numbers. But as a dealer, I can never have enough exposure. I always want more.
One of the big concentrations has been making sure all dealers are on a uniform, digital platform. With a smaller dealer body, it was more fragmented — guys doing various different companies. So they rolled out a digital program where we can pick between two or three endorsed vendors.
Basically, it’s a one-stop shop for your digital representation of the store. And it gives us a dashboard to monitor it. For dealers that aren’t as engaged, it kind of dumbs it down. If you pick one of those endorsed programs, which there’s no reason not to, they also allow [you] to use co-op dollars to pay for it.
If you use one of the endorsed companies, it’s reimbursed at 100 percent, so there’s really no potential cost to the dealer. It really encourages dealers to migrate to one of these all-inclusive programs. And that covers the whole gamut from the website, to your digital marketing, Facebook and Instagram to online purchasing.
Are there any product holes in the lineup that you want filled?
We are always clamoring for more product. Because of the alliance, one of the things that the dealer body brought up multiple times is the possibility of getting a truck back in our lineup. That’s been something that’s being explored. I don’t know where they are in terms of that, but that would be something real welcome by the dealer body. It doesn’t cannibalize anything. Somebody buying a truck typically isn’t shopping a car or an SUV. They want a truck. It would be true incremental business. The sedan market is a difficult one to enter. As much as we’d like to have a sedan, you better bring your A-game. The players that have remained in the sedan market, it’s the NFL of the autos. You’ve got to have the Toyota Camrys, the Honda Accords. You can’t just come in with some half-assed product. I would rather not be in the market than not come with the right product. Those brands are on the top of their game, and they’re entrenched.
I think the other one would potentially be an even bigger SUV. Us older Mitsubishi dealers still remember the Montero that is still sold across the globe. It’s just a great size, and that would be something that would be on our wish list.
As far as the sedans that you mentioned, do you think it will make sense to maybe bring over the Nissan Maxima platform to your lineup?
Maybe even a version of the Altima. I think it’s critical, whatever product if it’s a shared platform, that it’s our design so we maintain that edge and that Mitsubishi feel. To their credit, that’s what they did with the Outlander. It’s a common chassis [with the Rogue], but that’s where it ends. All the sheet metal and interior is all designed by Mitsubishi and has our own family-of-vehicle feel to it. We’re smart about sharing the platforms to get some economies of scale.
The Eclipse Cross is a pretty new vehicle in the lineup. Has it gotten the reaction you were looking for?
Well, no. Some of the consumers had issue, and the trade magazines as well, with the back end of the car. They likened it to look like a Pontiac Aztek. To [Mitsubishi’s] credit, that car has been completely redesigned, and relatively quickly. It’s been stretched, I believe, 11 inches, and the whole back end and front end has been reworked. It just has a more mainstream, high-end look to it. They’re being shipped now, so we haven’t gotten the new ones on the ground yet. But for somebody that had looked at them before, I think to look at it now, it’s a completely new vehicle loaded with technology. I think it’s going to be in the sweet spot of that CUV market.
What’s the audience for the Mirage?
It gets a lot of criticism just because it’s an entry-level car. It is what it is. It makes no bones about it. When I think when some of the magazines are critical on it, you can’t take a $13,000 car and compare it to a $25,000 and say it’s nowhere near. It is a commuter entry-level car that is just bulletproof. And, to my knowledge, it’s the highest mpg of any just normally aspirated car out there. It doesn’t pretend to be something it’s not. It’s not a midsize car, it’s not a family-of-six car. Our market for that car is a wide range. We have a lot of seniors that just want a safe, reliable 10-year warranty vehicle. They put gas in it and go. I sell a lot of them to first-time buyers, or used-car customers that come looking for a used car and realize what a value the car is to get something brand new with a 10-year warranty. It’s a pretty compelling offer. It fills a niche.
You’ve mentioned used cars. How is that part of the business doing for you? Are you getting some quality used vehicles to sell, or is it tough?
Used cars are just hot. It’s a double-edged sword. As most manufacturers, Mitsubishi has volume incentives that reward dealers that hit volume targets. The emphasis for dealers that want to capitalize on that is to chase volume with new. So what you find yourself doing is moving sometimes used-car customers into new cars.
It’s a fine line between hitting your new targets and still selling used cars because there’s a lot of crossover with customers. You can have the choice to put them in a new, or you can put them in a used car. The Mitsubishi franchise, we do tend to get an older car trade typically. So it’s harder to get quality trade-ins, and so we do end up buying used cars to supplement it, which is a challenge right now because the used market is hot.
How are fixed operations doing for your stores? Has revenue returned to pre-COVID levels?
It’s close. Fixed has always been a challenge just because our cars don’t break. I’m not trying to be cocky. Mitsubishi is always trying to engineer the vehicles for less maintenance. There’s no timing belt that needs changing; spark plugs last. It’s a challenge, I think, across the industry. As we want to lower the cost of ownership for customers, there’s less and less things to maintain as we engineer more reliability into things.