Starting To Lose Competing, Mitsubishi Consider Withdrawing Investment From China's Automotive Market
JAKARTA - China, with a large population, has become a target market that is very targeted by various automotive manufacturers. However, competing in the Chinese automotive market is not easy, especially given the intense competition there.
One of the manufacturers experiencing difficulties in the Chinese market is Mitsubishi. They have faced challenges in competing with other well-known manufacturers, especially due to a significant decline in demand. As a result, Mitsubishi is considering stopping its local production in the country.
According to a Nikkei Asia report on Wednesday, September 27, Mitsubishi plans to withdraw its investment from its local joint venture with the Guangzhou Automobile Group (GAC), which has been operating since 2012.
GAC Mitsubishi Motors peaked in 2018 with sales reaching 140,000 units of vehicles. However, the sales figure gradually decreased, and last year only managed to send 38,550 units of vehicles to customers, a decrease of 60 percent compared to 2021. As a result of the decline, production in Hunan province was stopped in March, and Mitsubishi had no intention of continuing operations there.
GAC plans to divert the plant to produce electric vehicles. The Chinese automotive company owns 50 percent of the shares in the joint venture, while Mitsubishi Motors owns 30 percent, and the remaining 20 percent is owned by Mitsubishi Corporation.
Thus, GAC Mitsubishi will continue to operate as a company entity, but these two Japanese companies will withdraw their investment from the joint venture.
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It is reported that the withdrawn funds will be diverted to operations in Southeast Asia and Oceania, which represent about a third of Mitsubishi's global sales annually.
Meanwhile, Mitsubishi, as a Japanese manufacturer, continues to strive to bring the latest products to the market, such as All-New Triton and XForce, which are aimed at markets in Southeast Asia, Latin America, the Middle East, and Africa.