Mitsubishi Australia goes full import
February 5, 2008 by Alborz Fallah
Mitsubishi Motors Australia Ltd (MMAL) together with its parent company Mitsubishi Motors Corporation (MMC) has just issued a press release outlining the closure of the Adelaide plant as well as committing to a long-term participant in the Australian car market as a full importer.
Official word from Mitsubishi has confirmed the closure of the Tonsley Park production facility in Adelaide, (where the 380 sedan is made) and also the end of production for the 380 Sedan. No other vehicles in the lineup will be affected.
“We are focused on growth in Australia, notwithstanding the decision to cease local manufacture.” Mitsubishi Motors Australia Ltd President and CEO Robert McEniry said
The closure comes despite strong growth by the Japanese brand as a whole. Australia is the fifth largest country for Mitsubishi vehicle sales in the world and the manufacturer has grown 20.7 percent in the last 12 months.
Nonetheless all the good results are solely due to Mitsubishi’s imported passenger, light commercial and SUV vehicles and not the locally manufactured 380 Sedan.
“However, it is an inescapable fact that there is now a deepening trend away from large cars. The Adelaide plant has been the subject of numerous studies over recent years into its utilisation and options for alternative model production.
“Over the last few months, we have been working closely with MMC to determine the best business model to secure Mitsubishi’s long term aspirations for the Australian market. After a searching analysis of the current business structure and extensive review of the available options for the Adelaide plant, a decision has been made to cease production and focus on a full import approach.
“We can see no path for a return to viable production levels of the 380 sedan, or a commercial case for developing any replacement production.
“This has been a very difficult decision. We have a deep appreciation of the commitment and loyalty of our workforce, suppliers and other business partners who have given the plant a proven track record of flexibility, cost efficiency and excellent quality control,” Mr McEniry said.
Mitsubishi will also pay back the $35 million grant received from the South Australian government in 2002.
FCAI chief executive Andrew McKellar was quick to point out that despite the significant impact on the Australian manufacturing sector, Mitsubishi’s contribution to total vehicle manufacturing in Australia was now only in the range of two to three per cent of all vehicles made.
“Notwithstanding the Mitsubishi decision there is no doubt automotive manufacturing continues to be particularly important to Australia, today’s announcement highlights the intensely competitive environment in which all Australian motor manufacturers are operating. Australia has the most open and competitive automotive market in the world.” McKellar said.
The plant’s closure will put 930 Mitsubishi employees out of a job as well another estimated thousand workers who are indirectly linked to the 380 project.
Mitsubishi workers will receive very favourable separation packages based on those provided to the Lonsdale Engine Plant employees in 2005.
“Over the last ten years, MMC has gone beyond the call of duty in supporting manufacturing in Australia through major capital investment, in addition to covering significant operating losses. Having persevered for so long, it is simply not rational to contemplate continuing such losses. To invest in further models for local production can not be justified.”
“Given the magnitude of the challenge, government assistance is not the answer to maintaining manufacturing at Tonsley Park, and this has not been sought by the company.” Mr McEniry said.
Current 380 owners need not to worry (except for resale) as Mitsubishi also announced plans to support past and future private buyers of the 380 with an extension of their warranty terms to six years.
“Mitsubishi is now focused on further growth in the Australian market. We have a comprehensive model range – Lancer, Colt, Grandis, Pajero, Outlander, Triton and Express Van, which today comprise nearly 90% of our annual sales – with more new products to come, confirming our long-term presence and growth aspirations in the Australian car market,” Mr McEniry said.
March 31st will mark the last day for Mitsubishi’s local operations in Australia. This will leave Ford, Holden and Toyota as the only remaining manufacturers with an Australian production facility.
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Mitsubishi Australia Overview
DEALER NETWORK
212 single and multi-franchise dealership sites across metropolitan and regional Australia
CORPORATE HISTORY
| Date | Event |
| 1885 | TJ Richards Blacksmith business founded in Adelaide |
| 1905 | T J Richards commenced car body production. |
| 1917 | TJ Richards commenced assembly of motor vehicles in Australia. |
| 1947 | TJ Richards taken over by the Chrysler Corporation. |
| 1960 | The Mitsubishi marque launched in Australia with the introduction of the first imported small car Colt. |
| 1964 | Tonsley Park vehicle manufacturing plant opened by Chrysler Australia Limited. |
| 1971 | Chrysler Australia Limited commenced manufacturing Mitsubishi-designed Galant. |
| 1980 | Mitsubishi Motors Corporation of Japan and Mitsubishi Corporation jointly acquired the Chrysler business in Australia as Mitsubishi Motors Australia Limited. |
| 1985 | Magna production commenced. |
| 2001 | Mitsubishi Motor Australia Limited became a 100 percent owned subsidiary of Mitsubishi Motors Corporation |
| 2005 | 380 sedan production commenced. |
| 2008 | Mitsubishi Motors Australia Limited closes Tonsley Park facility and moves to full-line import business model. |
PLANT DATA
1284 South Road, Tonsley Park
63.9 Hectares Land
185,000 Sq m Building and Improvements
EMPLOYEES
1,150 personnel currently employed
930 employees will be affected by this decision
MITSUBISHI IMPORT SALES GREW 32.4% FROM 2006 TO 2007
Print it: 
Don’t see why they couldn’t swing over the production line to making Outlander or Pajero.
or Lancer (small cars – like Ford are planning to do in 2011 with the focus being built here)… Not great is it?
Reckless, that would be actually cutting production below what the levels already were (assuming no export market).
Bottom line is everything else in the model lineup is built somewhere cheaper – there is no business case.
At least taxpayers of SA will get our money back – MIKE, spend it wisely (No not another bloody useless tram extension nobody wanted or needed. But at least the temporary chaos during construction is over – and now we can get used to the PERMANENT chaos).
Too expensive to produce cars here unfortunately… now I wonder what car they will bring in (if ever) to replace the 380.. please don\’t bring the galant :o
Seeing as MMC in Japan doesn’t have a ‘large’ car at the moment – they have the Galant Fortis (current Lancer) selling alongside the last generation Lancer; I don’t think we’ll get a direct replacement. They could possibly include another trim level for the Lancer with leather and other goodies maybe….
That concept family/luxury car they had with the turbo diesel engine looked rather promising though.
You can all blame the absolutely craptastic look of the 380 for this. At least if they had of made a decent looking car then it might have been different. Worst designed car, ever. Down on power, down on looks, fwd again in a large family car. Whoever planned that really had no idea if they wanted to complete with Holden and Ford.
whoever planned that probably didn’t have enough money to do what people ‘wanted’. :P
Sorry to hear this folk. Hope all involved get new jobs to support their families.
Similar things have happened here with Peugeot moving production from the UK to Slovenia due to labour costs, thats the problem with Australia, labour costs are too high. Its not fair on the SA tax payer to support ailing industries. We did that in the 70’s to no avail, re. British Leyland.
Wrong product for the market sadly, I remember the 380 launch thinking then it wouldn’t go far.
It is sad. the 380 was the best car ever produced in this country. It is still safer, greener, better built and more secure than any other on the market.
Ford will be next………
Mazda, Honda, Nissan, Hyundai etc etc all import only with better products at better prices.
The customer is the winner.
Sad all the same, lesson not to dish out shit to the punters…….
Cheers
F-0
Mitsu Australia must really be bleeding money for Mitsu Japan to want to pull out now. They only had to wait two more years until 2010 and they could legally keep their $35 million grant. The accounting numbers must be really bad if Japan is willing to stump up $35 million now to buy their way out of Australia.
I’ve driven a 380 sx for 8 days and I own a TH Advance 3.5 and the 380 didn’t feel that much different in anyway that makes me wish I owned one.I new the days were numbered as did many co-workers, even prior to the release of the 380 and so did most people that worked at the plant except for the delusional manager wannabees. Yes! Im an ex Mitsubishi worker.I am sad for the people of whom this final decision of plant closure will impact on.
Oh! well at least this has put an end to those closedown rumours.I truely believe that Management new this as well, but you know how this savage cruel corporate world works.They are paid to save face for the greater good of the corporation until the bitter end, and ensure any future Job prospects for themselves while at the same time saying how unfortunate this situation is and how they feel for everyone that is affected and that they had no prior knowledge or warning. YEAH RIGHT!!!! Denial, Denial, Denial and then eventually inevitability.
380 was a good an effort by MMAL. But they made few crucial mistakes. The 380 name was a mistake should have called it the Galant or Magna, that would have allowed them to use the 2.4L 4 Cyl engine as well as the larger 3.8L V6 and, also should have had the 3.8 Mivec engine on the sports models, other things which effected 380 sales were the lack of curtain air bags, ESP, 6 speed auto/manual transmission…
I think the real nail in the coffin for the business case was dwindling sales of large cars in Australia and a lack of export markets for Mitsu Australia to sustain production numbers of the 380. Realistically, I don’t think the 380, and local Mitsu manufacturing, would have been saved even if the 380 was a better car.
Mitsubishi will lose more money bringing down the outlander and/or pajero..
in fact Australia is one of the highest least profitable countries for autmotive manufacturing… labor cost too much and market/economy doesnt have enough room to support more than 3-4 locally manufactured cars.
But it is a mystery why they didnt wait till 2010… im not too sure about the government grant becomming legally theres after that, but they must be seriously in the red ink to pull out so quick.
Marketing is one to blame also, as someone said, the 380 name alone is poor. The car itself is decently built, looks are always debatable… so i dont blame that. the fact that big cars are slowing down in sales in favor of medium-small.. thats one factor also.
but the main is the high manufacturing costs and insufficient market economy size. Maybe in 50 years they’ll come back… when the population doubled haha.
But by then, Toyota or Honda will probably own 80% of the automotive companies between them. So who knows.
Well if they didn’t pull out now, they’d have to do a mid-life facelift (not just another series update) on the 380 to remain at all competitive, which would cost $$$ and then wouldn’t result in many more sales, if at all.
I wonder whether Mitsu will import the Galant Grunder from Asia (another Galant based car) as our ‘large’ car. LOL
Frugal One, will you please stop interrupting when the grown ups are talking?
Please retreat to your LPG turbo hyundai fantasy land.
Why didn’t they wait until 2010? Simple do the sums. Salary dollars alone is a bigger bucket than $35 mill.
I’m pretty sure Mitsu has figured out that they will ose more money waiting till 2010 rather than returning the $35mill – which isn’t much to begin with – some website stated its only enough to design door handles :P
Considering how MMA has lost >$1bill over the past 10 years, that equates to >$100mill a year.. so waiting till 2010.. well..
I realise it is all good business, but I like to see MMC is going to ensure that workers are fully paid up and offer redundancy packages and pay back the $35mill without being asked (as if they could win a court case anyway).
Good to see a company just doing the right thing, even though it is probably in the name of keeping a good name in the interests of selling more cars in future :)
Sadly at the end of the day their local problems stem from the fact that the patent company was virtually broke 5 or so years ago. (remember the Daimler Chrysler bail out and subsequent split)
When the parent company had no cash to help develop new models the local arm was forced to take the US galant as its replacement for the Magna.
Not only did this have the effect of giving them a car that was seen to be styled for US tastes ( both physically and dynamically) but also ended their LHD export program. Yes they did export the Magna as a Diamonte (?) to the US.
The lack of cash in japan is still evident in the current express (SJ) model. 22 years on the current bodystyle and still going! Even the last Triton was only around for 10 years.
So after 1.5 billion in losses in ten years it had to happen.
I think Mitsubishi will still be able to sell well here in Australia. Actually, discontinuing the 380 would give them a better chance of selling new cars because that car has been given some negative feedback and criticism by the media and consumers as well since the time of its inception. Now that its out of the way, MMAL can now concentrate and focus more on selling more viable products like the Lancer and Outlander, and the much awaited Evo X which I think most of the buying public prefers. Pitty though to the employees, hopefully MMAL will keep their promise of properly compensating them and give them assistance for employment in other industries.
No! I hear that the closure is only a rumour. If they keep on talking about Mitsubishi Motors Australia in such a negative manner it will impact on sales of the 380.
Just stating what the die hards have been saying for the last few years.I would hate to have been leasing a 380 or any other car/s through the employment scheme, then all of a sudden left hung out to dry and maybe having to look at purchasing a motor vehicle with their payout. Boy that would truly suck!!