Don’t write companies or brands off in this business.
Today’s car company poor performer and apparently spent force facing terminal decline may well turn out to be looking a lot better tomorrow. Remember Fiat before Marchionne? The obituary was being written up, a few years of thrashing around and death throes in prospect before the inevitable end. But that didn’t happen. The Canadian-Italian got everyone around the table for a last chance reorganisation and it worked. The government, banks and labour unions backed it and a decisive corner was turned.
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The key is to stay in business and remain at the table. Liquidity is key. If you’re in the game, there’s always a chance that things can turn, that you can undertake structural changes and get competitive, find a hit model, or market geography turns favourable and people – stakeholders such as investors, governments, workers – start to believe (they may also want to believe, so making the jump to actually believing may not necessarily be a huge step – eg in Fiat’s case; not quite the same under Mrs Thatcher with BL). Heck, you may even be able to spin a good story and convince investors that you have a credible business model and strategic plan (see Fiat under Sergio Marchionne – but good luck with the ambitious Alfa volumes…).
Another company that has experienced something of a recovery and reversal of fortunes is Mitsubishi Motors. MMC spent the first half of the last decade struggling to revive its damaged brand following a series of recalls and the arrests of former executives after it concealed safety-related defects from authorities. It was a pretty bad period that took some recovering from, but being part of a big group – ie Mitsubishi Group and its banks – undoubtedly helped when it came to restructuring operations.
Anyway, the company has just announced its latest targets in a plan called ‘Jump 2013’. It’s a far cry from a decade ago when scandal (there was a company locker where reported product faults were unceremoniously filed to be ignored) and major recalls were becoming MMC brand associations. As sales plummeted, losses ballooned. It took years to gradually put right, but MMC today looks very different from the bloated and badly run company of ten years ago.
See Also:
JAPAN: Mitsubishi Motors sets out its future
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