Fresh dealer injection energises Mitsubishi

MITSUBISHI expects to grow its sales by 4500 units in 2010 with the aid of an overhauled dealer network in which more than a third of the 210 outlets have changed hands in the past three years.

Mitsubishi Motors Australia Ltd president and CEO Robert McEniry pushed through the sweeping changes at retail level to ensure improved coverage, weed out poor performers, introduce new performance contracts and provide financial support to upgrade facilities.

“We’ve changed about 38 per cent of our metropolitan network, about 31-32 per cent of our provincial network and 15 per cent of our country network,” he said.

“We’ve had a fair change, and by change I mean ownership change or dealerships close and new ones opened or whatever. It’s a significant number.

“The dealers are actually making more money now and prepared to trade.”

Mr McEniry said Mitsubishi now expected to sell 56,500 cars, commercials and SUVs in 2009, up from 50,000 Mitsubishi projected earlier in the year.

Next year, Mitsubishi expects to deliver 61,000 vehicles in a market that Mr McEniry forecast would top 910,000.

Left: Mitsubishi Australia president and CEO Rob McEniry.

Mitsubishi Australia’s head of corporate communications, Lenore Fletcher, said a “few holes in the network” had been addressed, particularly in Sydney.

Ms Fletcher noted that a lack of performance was an issue only in “a handful of cases”.

“There were some performance issues, some may have left the pack for different reasons they may have had competing brands for example,” she said.

Ms Fletcher said that as part of this auditing process, some tightening up was involved in dealer agreements.

“Perhaps the initial agreements didn’t reflect the current market,” she said.

Some of the dealer agreements went back 20 years, said Ms Fletcher, while others were informal verbal agreements.

The new agreements – allowing for an annual review of the dealers and including performance measures and standards – were supported by the dealer council “because it helps them know where they stand”, she said.

As part of the network overhaul, Mr McEniry wants dealers to have consistent, contemporary facilities and is recommencing its support of facility improvements in the New Year.

“We’ve pulled back this year – because of the GFC – on the [dealer facilities] upgrades, mainly because we didn’t want to put that pressure on dealers during that period, but what we did say was as things improved, turn on our focus on that again. So from January, we’ll start that programme again.”

According to Ms Fletcher, the dealer improvements are backed by “substantial financial support” from Mitsubishi and also include architectural and design support to ensure consistency down to the colour of the tinted showroom glass to the particular shade of red for the showroom couches.

Ms Fletcher said Mitsubishi now kept getting requests from non-Mitsubishi dealers to join the network, a phenomenon she said that “has only started to happen in the last 12 months”.