Mitsubishi 380

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The Mitsubishi 380, now known as Mitsubishi 380 Series II, is the successor to the Mitsubishi Magna/Verada line of vehicles built by Mitsubishi Motors Australia Ltd (MMAL). The company spent over AU$600 million developing and producing the car. It is manufactured at the Tonsley Park, Adelaide plant. Prices start from $27,990.

Relationship to the Galant

Based on the North American Galant, the main visible differences from the Galant are bonnet, front guards, grills and bumpers. There have also been changes to 70% of the American car to create a car more suited to the Australian market, such as the use of higher quality materials and new sophisticated suspension designs.

Market niche

The 380 is a six-cylinder car that targets the "family car" segment. It also tried to appeal to the "high performance" segment. The Mitsubishi 380 continues the tradition of MMAL to produce front wheel drive sedans for the Australian market, to compete against the rear wheel drive Ford Falcon and Holden Commodore sedans.

Models

It is a sedan only, and is powered by an all-new 6G75 3.8 L V6 engine. Unusually, the sports model does not have a more powerful engine than the cheapest entry level model, although in March 2006 an update to the engine will see power go up to 190 kW in VRX form (up from 175 kW). This is because financial difficulties forced Mitsubishi to shut down its Australian engine factory. An anomaly is that the manual 380 ES (manual is only offered optionally with the ES) is actually the fastest.

It outputs 175 kW and 343 N·m of torque, and is mated to a five-speed automatic or manual. The Mitsubishi 380 comes in five variations; ES, SX, LX, VRX, and GT. The ES has standard options like front and side air bags, automatic climate control air conditioning, power mirrors, power windows, power driver's seat, wheel mounted remote audio controls, ABS with Electronic Brakeforce Distribution, the SX has different trim, electrochromatic mirrors and alloy wheels, the LX has leather upholstery, 10-way power seat with memory and a sunroof, and the GT has all available options as standard, including blue-tooth connectivity. In New Zealand, where the car is also sold, the VR-X and GT produce an extra 5 kW due to a less restrictive induction system fitted (and lesser noise regulations).

Awards

It received Australia's Best Cars Large Car 2005 award, as well as IAG Insurance group's rating as the most secure Australian family car. Previously the 3.8 L engine won an award for excellence from the Society of Australasian Engineers.[Australia's Best Cars]

Sales trouble

The 380 went on sale on October 13, 2005. It has sold in lesser numbers than expected and on January 20 2006, MMAL announced that voluntary redundancies would be offered to 250 production employees to bring production in line with customer demand. On February 6 2006, it was announced that production would be paused during the first three weeks of March, production has now resumed at a reduced rate.

Only 717 cars were sold in January 2006, while the company had hoped to sell 2500 cars/month or 30,000 cars/year. Sales have dropped every month since release with a total of only 4,200 cars having been sold in the four months since release in mid-October. Some of the early sales were preorders from the South Australian government, which were against their regular orders.

In late April 2006, Mitsubishi announced price reductions. The entry-model, now called the ES, was reduced from $34,490 to $27,990. An SX model was introduced, priced at $32,990, while the LS model was dropped. Prices on VRX, LX, and GT models were also reduced by amounts ranging from $1,500 to $3,000. Mitsubishi also announced that up to 1,500 retail customers who paid the old price would be eligible for a factory rebate of up to $2,000.

Causes of poor sales

Factors causing the poor sales include:#redirect

• A relatively high price compared to the discounted models of some other manufacturers.
• Perceived low resale value of the preceding model, the Magna. According to the Redbook[Redbook] industry pricing guide, the Magna typically sold for just 35% of its original price after 2 years.
• The unclear target market and the company's apparent inability to find a niche for the car.
• Rising fuel prices. This has accelerated the decline of the large car market in Australia. There has been a switch in market tastes from the traditional Australian six-cylinder sedan to a variety of other market offerings (although it is expected to pick up again later this year with the introduction of two new models to the market segment).
• An interior that looks lower quality.
• The lack of a high power engine for sports models.
• The lack of a lower end engine. The related Mitsubishi Galant has a 2.4 MIVEC 4 cylinder unit that would be a natural for the 380.
• The lack of an AWD variant as with the Magna.
• The lack of a wagon.

Possible impact of failure on Mitsubishi Australia

It is likely that Mitsubishi will cease all car manufacturing operations in Australia. This is a scenario that has been mooted by analysts for some time.#redirect Since the 380 has failed to sell at a sustainable level it appears inevitable. However in a new effort to boost sales, Mitsubishi have just relaunched the 380 with a new campaign as the first part of a four-part strategy during 2006. It maintains that fleet sales will pick up from March.

In March 2006 the manufacturing plant closed for 3 weeks in order to "bring production in line with demand."["Mitsubishi takes 3 weeks off"], Andrew Heasley & Rachel Kleinman, The Age, February 10 2006

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