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Mitsubishi Motors Reinforces Commitment to North American Market

21 July 1999

Mitsubishi Motors Reinforces Commitment to North American Market; Top Executives From Tokyo and U.S. Review Company's Financial Recovery

    LAS VEGAS, July 21 -- Mitsubishi Motors Corporation (MMC)
President Katsuhiko Kawasoe joined top officials from MMC and its U.S.
distribution and manufacturing subsidiaries in a briefing today of business
reporters and industry analysts to review the company's financial recovery and
outline its strong commitment to the North American market.
    Kawasoe discussed the current status of MMC from a global perspective, and
its future product plans for the North American market.  With five
subsidiaries in the U.S., including Mitsubishi Motor Sales of America, Inc.
(MMSA); Mitsubishi Motor Credit of America, Inc. (MMCA); Mitsubishi Motor
Manufacturing of America, Inc. (MMMA); Mitsubishi Motors America (MMA); and
Mitsubishi Research and Development of America, Inc. (MRDA), Kawasoe stated
that the company's overall focus is to realize greater efficiencies through
reduced costs and greater integration.  The organization has already
integrated major parts of its U.S. sales and credit operations and is looking
to further consolidate management resources at its U.S. manufacturing and
sales operations.
    "The U.S. market and our operations here are extremely important to our
global competitiveness," said Kawasoe.  "Mitsubishi Motors absolutely stands
behind our U.S. operations, and the decision-making of our U.S.-based
executives."
    Kawasoe described MMC's financial recovery, including the $888 million
improvement in net income from 1997 to 1998.  Cost savings realized under the
company's Renewal Mitsubishi 2001 Plan (RM2001) exceeded its projected target
for the first year prompting a revision of the program's prior 3-year target
of $2.9 billion to $3.5 billion.
    Joining Kawasoe at the briefing were Richard Gilligan, chief operating
officer for MMMA, who discussed changes to operations at the manufacturing
plant in Normal, Ill., to enhance productivity, profitability, and product
quality, and Pierre Gagnon, chief operating officer for MMSA, who described
how the U.S. distributor returned to profitability, through the enhancement of
brand image, improvement of customer and dealer relations, and the
introduction of new retail processes.
    Over the past year, Gilligan indicated that MMMA has been aggressively
implementing more than 20 initiatives that will have long term impact on the
quality, productivity and profitability of the U.S. assembly plant, providing
more than $100 million in savings through reductions in headcount, overtime,
logistics, warranty and other cost areas.  "Driving quality is at the heart of
our efforts," said Gilligan, "and we are making significant changes to our
manufacturing process to accomplish this."
    Returning to profitability in 1998 for the first time in years and with
the expectation of achieving higher profitability for 1999, MMSA has made
fundamental changes in almost every facet of its organization.  According to
Gagnon, the company will continue to change to meet the needs of the current
dynamic and highly competitive environment.
    Following a very focused "turn-around strategy" that was implemented
during 1998 to build the fundamentals, Gagnon deems 1999 as the "year of
execution."  MMSA is building a stronger brand image through a consistent
communications strategy; strategic use of the web and relationship marketing
programs; customer-focused retail processes at dealerships; and a consolidated
marketing effort with committed retail partners.  "We're creating a stronger
partnership with our dealers, while developing a more customer-focused,
market-driven organization that is accountable to the bottom line," he said.
    Akira Kijima, board member and vice corporate general manager of car
research and development for MMC, also spoke about how the gasoline direct
injection (GDI) technology benefits MMC as a global automotive technology
leader, and what future role it can play in the North American market.
    Copies of all remarks will be available through the Mitsubishi News
Bureau, 800/233-6672.
    Tokyo-based Mitsubishi Motors Corporation is a world-wide producer of
motor vehicles, trucks and buses, with manufacturing facilities in Japan,
Southeast Asia, Europe and North America.  It produces vehicles in the United
States at Mitsubishi Motor Manufacturing of America, Inc., in
Bloomington/Normal, Ill., and distributes its vehicles through its sales
subsidiary, Mitsubishi Motor Sales of America, Inc., in Cypress, Calif.