automobiles (1917) Mitsubishi's automotive origins date back to 1917, when the Mitsubishi Shipbuilding Co., Ltd., introduced the
Mitsubishi Model A, Japan's first series-production automobile. An entirely hand-built seven-seater
sedan based on the
FIAT Tipo 3, it proved expensive compared to its American and European mass-produced rivals, and was discontinued in 1921 after only 22 had been built. In 1934, Mitsubishi Shipbuilding was merged with the Mitsubishi Aircraft Co., a company established in 1920 to manufacture aircraft engines and other parts. The unified company was known as
Mitsubishi Heavy Industries (MHI), and was the largest private company in Japan. MHI concentrated on manufacturing
aircraft,
ships,
railroad cars and machinery, but in 1937 developed the
PX33, a prototype sedan for military use. It was the first Japanese-built passenger car with full-time
four-wheel drive, a technology the company would return to almost 50 years later in its quest for motorsport and sales success. on display at the
Mondial de l'Automobile in September 2006
Post-World War history Immediately following the end of the
Second World War, the company returned to manufacturing vehicles.
Fuso bus production resumed, while a small
three-wheeled cargo vehicle called the
Mizushima and a
scooter called the
Silver Pigeon were also developed. However, the
zaibatsu (Japan's family-controlled industrial conglomerates) were ordered to be dismantled by the
Allied powers in 1950, and Mitsubishi Heavy Industries was split into three regional companies, each with an involvement in motor-vehicle development: West Japan Heavy-Industries, Central Japan Heavy-Industries, and East Japan Heavy-Industries. East Japan Heavy-Industries began importing the
Henry J, an inexpensive American sedan built by
Kaiser Motors, in
knockdown kit (CKD) form in 1951, and continued to bring them to Japan for the remainder of the car's three-year production run. The same year, Central Japan Heavy-Industries concluded a similar contract with
Willys (now owned by Kaiser) for CKD-assembled
Jeep CJ-3Bs. This deal proved more durable, with licensed Mitsubishi Jeeps in production until 1998, 30 years after Willys had replaced the model. By the beginning of the 1960s, Japan's economy was gearing up; wages were rising and the idea of family motoring was taking off. Central Japan Heavy-Industries, now known as Shin Mitsubishi Heavy-Industries, had already re-established an automotive department in its headquarters in 1953. Now, it was ready to introduce the
Mitsubishi 500, a mass-market sedan, to meet the new demand from consumers. It followed this in 1962 with the
Minica kei car and the Colt 1000, the first of its
Colt line of family cars, in 1963. In 1964, Mitsubishi introduced its largest passenger sedan, the
Mitsubishi Debonair as a luxury car primarily for the Japanese market, and was used by senior Mitsubishi executives as a company car. West Japan Heavy-Industries (now renamed Mitsubishi Shipbuilding and Engineering) and East Japan Heavy-Industries (now Mitsubishi Nihon Heavy-Industries) had also expanded their automotive departments in the 1950s, and the three were reintegrated as Mitsubishi Heavy Industries in 1964. Within three years, its output was over 75,000 vehicles annually. Following the successful introduction of the first
Galant in 1969 and similar growth with its commercial-vehicle division, the company decided to create a single operation to focus on the automotive industry. Mitsubishi Motors Corporation (MMC) was formed on 22 April 1970, as a wholly owned subsidiary of MHI under the leadership of Tomio Kubo, a successful engineer from the aircraft division. The logo of three red diamonds, shared with over 40 other companies within the
keiretsu, antedates Mitsubishi Motors itself by almost a century. It was chosen by
Iwasaki Yatarō, the founder of Mitsubishi, as it was suggestive of the emblem of the Tosa clan who first employed him, and because his own family crest was three
rhombi stacked atop each other. The name consists of two parts –
mitsu meaning "three" and
hishi (which becomes "
bishi" under
rendaku) meaning "
water caltrop" (also called "water chestnut"), and hence "rhombus", which is reflected in the company's
logo.
1970s: Chrysler partnership Part of Tomio Kubo's expansion strategy was to increase exports by forging alliances with well-established foreign companies. Therefore, in 1971, MHI sold U.S. automotive giant
Chrysler a 15% share in the new company. Thanks to this deal, Chrysler began selling the Galant in the United States as the
Dodge Colt (which was the first rebadged Mitsubishi product sold by Chrysler), pushing MMC's annual production beyond 250,000 vehicles. In 1977, the Galant was sold as the
Chrysler Sigma in Australia., the basis for the company's first
captive import deal with Chrysler By 1977, a network of "Colt"-branded distribution and sales dealerships had been established across Europe, as Mitsubishi sought to begin selling vehicles directly. Annual production had by now grown from 500,000 vehicles in 1973 to 965,000 in 1978, when Chrysler began selling the Galant as the
Dodge Challenger and the
Plymouth Sapporo. However, this expansion was beginning to cause friction; Chrysler saw its overseas markets for
subcompacts as being directly encroached by its Japanese partners, while MMC felt the Americans were demanding too much say in its corporate decisions.
1980s: U.S. entry Mitsubishi Motors finally achieved annual production of a million cars in 1980, but by this time, its ally was not so healthy; as part of its battle to avoid
bankruptcy, Chrysler was forced to sell its Australian manufacturing division to MMC that year. The new Japanese owners renamed it
Mitsubishi Motors Australia Ltd (MMAL). In 1982, the Mitsubishi brand was introduced to the American market for the first time. The
Tredia sedan, and the
Cordia and
Starion coupés were initially sold through 70 dealers in 22 states, with an allocation of 30,000 vehicles among them. This
quota, restricted by mutual agreement between the two countries' governments, had to be included among the 120,000 cars earmarked for Chrysler. A restricting element of Mitsubishi's deal with Chrysler was that Chrysler had the right of first refusal of any Mitsubishi automobiles in the US market until 1990. Toward the end of the 1980s, as MMC initiated a major push to increase its U.S. presence, it aired its first national television advertising campaign and made plans to increase its network to 340 dealers., the company's most successful
SUV Despite the ongoing tensions between Chrysler and Mitsubishi, they agreed to unite in a vehicle manufacturing operation in
Normal, Illinois. The 50/50 venture provided a way to circumvent the voluntary import restrictions, while providing a new line of
compact and
subcompact cars for Chrysler.
Diamond-Star Motors (DSM)—from the parent companies' logos: three diamonds (Mitsubishi) and a pentastar (Chrysler)—was incorporated in October 1985, and in April 1986, ground was broken on a 1.9-million-square-foot (177,000 m2) production facility in Normal. In 1987, the company was selling 67,000 cars a year in the U.S., but when the plant was completed in March 1988, it offered an annual capacity of 240,000 vehicles. Initially, three platform-sharing compact 2+2 coupés were released, the
Mitsubishi Eclipse,
Eagle Talon, and
Plymouth Laser, with other models being introduced in subsequent years. Before receiving government approval for this project, Mitsubishi had to express contrition over "defective" Mitsubishi trucks imported to China in 1984 and 1985. By 1989, Mitsubishi's worldwide production, including its overseas affiliates, had reached 1.5 million units. Mitsubishi Motors went public in 1988, ending its status as the only one of Japan's 11 auto manufacturers to be privately held. Mitsubishi Heavy Industries agreed to reduce its share to 25%, retaining its position as largest single stockholder. Chrysler, meanwhile, increased its holding to over 20%. The capital raised by this initial offering enabled Mitsubishi to pay off part of its debts, as well as to expand its investments throughout Southeast Asia, where it was by now operating in the
Philippines,
Malaysia, and
Thailand.
1990s: SUV focus Hirokazu Nakamura became president of Mitsubishi Motors in 1989, and steered the company in some promising directions, with the advent of the
Japanese asset price bubble "
market correction" that led to the
Lost Decade as a result of the
Plaza Accord agreement signed in 1985. Sales of the company's new
Pajero were bucking conventional wisdom by becoming popular even in the crowded streets of Japan. Japanese media rumored in 1992 and 1993 that Mitsubishi Motors intended a hostile acquisition of
Honda. While Mitsubishi was riding high off of profitable vehicles such as the Diamante and Pajero, Honda was caught off-guard with the SUV and truck boom, and was losing focus after the illness and later death of
its founder. Honda CEO
Nobuhiko Kawamoto took drastic steps, though, such as exiting Formula 1 and discontinuing unprofitable vehicles to avert a Mitsubishi takeover, which proved effective. Although sales of
SUVs and light trucks were booming in the U.S., Japan's car manufacturers dismissed the idea that such a trend could occur in their own country. Nakamura, however, increased the budget for SUV product development, and his gamble paid off; Mitsubishi's wide line of
four-wheel drive vehicles, from the
Mitsubishi Pajero Mini kei car to the
Delica Space Gear passenger van, rode the wave of SUV-buying in Japan in the early to mid-1990s, and Mitsubishi saw its overall domestic share rise to 11.6% in 1995. In 1991, Chrysler sold its equity stake in Diamond-Star Motors to its partner Mitsubishi Motors, and from then on the two companies continued to share components and manufacturing on a contractual basis only. Chrysler decreased its interest in Mitsubishi Motors to less than 3% in 1992, and announced its decision to divest itself of all its remaining shares on the open market in 1993. The two companies then terminated their close alliance, with Mitsubishi Motors no longer supplying parts for engines and transmissions for Chrysler. After this period, the company sought alliances with many other automotive manufacturers in different areas of the world, as described under "other alliances" below, with its most economically significant alliance being with
Nissan to develop and manufacture kei cars.
2000s Mitsubishi Heavy Industries (MHI) participated in a ¥540-billion emergency rescue of Mitsubishi Motors in January 2005, in partnership with
Mitsubishi Corporation and
Mitsubishi Tokyo Financial Group. As part of the rescue, MHI acquired ¥50 billion of Mitsubishi Motors stock, increasing its ownership stake to 15% and making the automaker an affiliate again. The emergency rescue was carried out 4 years after a product recall scandal in Japan that was triggered by accusations of Mitsubishi Motors trying to systematically hide manufacturing defects to avoid recalls, and marketing problems in the US. The next generation of its Lancer and
Lancer Evolution was launched in 2007 and 2008. Slow-selling vehicles were eliminated from the U.S. market, purchase projections for the
Global Engine Manufacturing Alliance have been scaled back, and 10,000 jobs were shed to cut costs with 3,400 workers at its Australian plant and other loss-making operations still under threat. Meanwhile, in an effort to increase production at its U.S. facility, new export markets for the Eclipse and Galant were being explored in Ukraine, the Middle East, and Russia, where the company's bestselling dealership is located. Mitsubishi Motors has also been active in
OEM production of cars for
Nissan, and announced a similar partnership with
Groupe PSA in July 2005 to manufacture an SUV on its behalf. and returned to profitability by the end of the 2006 financial year, and sustained profitability and global sales of 1,524,000 through 2007 and later. In March 2015, Mitsubishi Motors started the construction of a new
manufacturing plant in Indonesia under a joint venture with
Mitsubishi Corporation (40%) and a local company Krama Yudha Group (9%), with the maximum production capacity of 160,000 vehicles per year. In July 2015, the Mitsubishi Motors announced that it plans to end production at the
Diamond-Star Motors plant in
Normal, Illinois, US, as the plant has been operating well below capacity for several years. Operations at the facility ended in May 2016. The plant was sold to Maynards Industries, which sold the site to American electric vehicle startup
Rivian in 2017.
2016–present: Renault–Nissan–Mitsubishi Alliance membership In May 2016, in the wake of the fuel-efficiency scandal uncovered by Nissan (discussed in
"Fuel economy scandal"), Nissan's acquisition of the 34% controlling interest in Mitsubishi Motors was completed in October 2016, when
Carlos Ghosn, the chairman of Nissan,
Renault, and the Alliance, also became chairman of Mitsubishi Motors. By 2023, Renault Group began supplying Mitsubishi cars in Europe, with the
Renault Clio and
Renault Captur rebadge as the Colt and ASX. The firm has no plans to sell any of the models in Britain or Ireland, as the Colt Car Company's Mitsubishi aftersales business was bought as a going concern by International Motors (a firm previously known for launching Hyundai onto the UK market in 1981). Mitsubishi Motors plans to stop developing car platforms for the Japanese market and instead use vehicle bases made by ally Nissan Motor beginning around 2026. == Other alliances ==