Official Restructuring Plan Due Friday
According to inside sources, Mitsubishi Motors Corp. (MMC) is in final talks with the Mitsubishi group of shareholder companies to receive USD$3.93 billion in investment, which should include a capital boost and debt-equity swap.
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| Mitsubishi needs investment capital in order to focus on the cars it will be launching in the next few years. (Photo: Mitsubishi Motors North America) |
While its current lineup is relatively up-to-date, MMC needs investment capital in order to focus on the cars it will be launching in the next few years, but it is entirely possible it will discontinue some niche models to reduce development costs and instead focus its energies on core small cars and SUVs. Whether or not "core" includes such potential money makers as the DaimlerChrysler co-developed Sport Truck shown in Detroit last January, or the replacement for its Eclipse coupe and convertible, is not known. There is also no word on whether MMC will develop new vehicles for North American market segments it currently is not competing in, such as the profitable minivan category. DaimlerChrysler's North American division would be the ideal candidate for sharing minivan architecture, albeit "sacred ground" for Chrysler Group.
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| There is no word yet on the future of the Mitsubishi/DaimlerChrysler co-developed Sport Truck shown in Detroit last January. (Photo: Mitsubishi Motors North America) |
Such co-development shouldn't be a problem between the two automakers, despite DaimlerChrysler AG's (a 37.3 percent stakeholder in MMC) decision not to be involved in a multi-billion-dollar capital infusion to the Japanese automaker last month due to worries about its own debt, or so CEO Jürgen Schrempp stated in an interview with Manager Magazine by saying, "It was a matter of risk for the entire group. By raising our stake we would have had to consolidate Mitsubishi in our group accounts. Then we would have had to put their debt on our balance sheet. This was what was decisive in the end." Schrempp has confirmed that DCX will remain a shareholder and most importantly continue to work with MMC in new model development (3/5/2004: DaimlerChrysler to Maintain Stake in Mitsubishi Motors).