Mitsubishi has cut shifts and laid off 900 temporary workers at its Nedcar assembly plant because the new Colt and Smart ForFour are selling slowly.
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The Japanese automaker has reduced shifts to two from three at the plant, which has capacity to build 100,000 Colts and 140,000 ForFours.
Daniel Nacass, Mitsubishi Europe spokesman, told Automotive News Europe that the new Colt, which was launched in April, is not selling as well as expected. He said consumers in Germany, Europe’s biggest vehicle market, are still reluctant to buy Mitsubishi models following DaimlerChrysler’s well-publicised refusal to rescue the troubled Japanese automaker in April. Nacass also said Mitsubishi’s goal of 85% conquest sales for the new Colt was too ambitious, especially in markets such as Italy and Spain.
“Our southern European dealers are very much focused on sports utility vehicles. They had difficulty adjusting their mindset towards cars,” he said.
Nedcar builds the four-seat ForFour model, which was introduced in March, for DaimlerChrysler’s Smart subsidiary. A D/C source said: “ForFour orders could have been better.” From March to the end of September, Smart sold less than 23,000 ForFours. Its target for this year is 50,000 units.
The Colt and ForFour share Mitsubishi-developed architecture and 60% of their components by value.
Mitsubishi and DaimlerChrysler are still talking about D/C buying a stake in Nedcar.
When the two companies signed their Nedcar joint small-car agreement four years ago, D/C agreed to buy 50% of the Dutch operation by this summer. The deal was shelved after D/C refused to back a rescue package for its then alliance partner Mitsubishi in April.
Financially troubled Mitsubishi is keen for D/C to take a majority 51% stake in Nedcar since the production volume mix between Colt and ForFour at the plant is 42/58 percent.
Said a D/C spokesman. “We are currently studying with Mitsubishi the possibility of a joint venture and expect a conclusion by the end of the year.”
