EV Pioneer Mitsubishi Swept Up in Currents of Change

TOKYO – Nearly a decade has passed since Mitsubishi launched the i-MiEV, the world’s first mass-produced electric car.

Although the automaker no longer is a leader in all-electrics, having been supplanted by Nissan, General Motors and a growing list of others, it ranks among the leaders in plug-in hybrids. Its Outlander PHEV, launched in 2013, was the industry’s best-seller in the two subsequent years.

Osamu Masuko, the automaker’s CEO who signed off on the i-MiEV and Outlander PHEV projects, is struck by how quickly electrification technology is advancing.

“Change is taking place much faster than we could have imagined,” he tells WardsAuto in an interview. “The pace of change is making it difficult to evaluate how we should move forward.

“If, for instance, China were to decide to go all-electric for its nearly 30 million-unit car market, the rest of the world would have to follow.”

Fortunately for Mitsubishi, it does not have to follow in its major market, Southeast Asia, which substantially lags China, Europe and North America in vehicle electrification.

When the automaker launched the i-MiEV in summer 2009, more than a year ahead of Nissan’s Leaf, Masuko notes the car’s lithium-ion battery pack cost more than ¥2 million ($18,000).

“Battery price has since fallen to one-fourth of that level and will go down further,” he predicts. “So we really can’t evaluate the marketplace with existing technology, because the technology is going to change in the next five to 10 years. The battery may be half the cost of what it is today and cruising range will surely be extended.”

Looking to the more distant future, Masuko warns of potentially disruptive effects of new players entering the market, specifically Tesla and Dyson.

“Whether they will be successful in the long run is another issue,” he says.

Moving forward, Mitsubishi which joined the Renault-Nissan Alliance in October 2016, will work jointly with its two larger partners in vehicle electrification.

Exactly how they plan to differentiate between brands is still a work in progress. However, the automakers announced in September they planned to introduce 12 new all-electric models over the next five years while sharing platforms for 70% of sales.

Sales targets for the upcoming EVs are unclear, although they surely will exceed last year’s 91,000 total.

When Nissan CEO Carlos Ghosn announced the automaker’s “Power 88” business plan in 2011, the automaker projected cumulative EV sales of 1.5 million units by fiscal 2016 including both Nissan and Renault brands. It fell short by nearly 1 million units.

Through the end of May, Mitsubishi has sold nearly 190,000 EVs and PHEVs since launching the i-MiEV nearly nine years ago. Included in that total are Citroen and Peugeot-based versions of the i-MiEV.

Separately within the alliance’s electrification plan, Mitsubishi will be responsible for plug-in hybrids in the C/D segment where the automaker’s next-generation Outlander PHEV will be the base model for the group.

In the all-electric segment, the alliance has committed to extending EV range to 375 miles (600 km) by 2022 while cutting battery costs 30%.

This almost certainly will impact the alliance’s battery supply base as the automakers currently source lithium batteries for EVs from multiple suppliers including Automotive Energy Supply (owned by GSR Capital, a Beijing-based equity firm), LG Chem and Lithium Energy Japan. Hitachi Automotive Systems supplies hybrid batteries.

Late last year, Nissan sold Automotive Energy Supply, its joint venture with NEC Corp., to GSR Capital, along with the automaker’s own battery operations in Smyrna, TN, and Sunderland, U.K. No changes were made in the sourcing arrangements, although Nissan has indicated it may introduce a larger-capacity battery for the Leaf this year. Analysts speculate the battery will be 60 kWh, up from the current 40 kWh.

Meanwhile, Hitachi Automotive Systems is transferring its hybrid-battery operation from Harrodsburg, KY, to an unspecified location in Asia, possibly Japan. At present, the supplier produces batteries for the Tribute, Rogue and Murano hybrids and ships them from Kentucky to Japan and China.

Lithium Energy Japan, a joint venture between Mitsubishi and GS Yuasa, supplies batteries to the i-MiEV and Outlander PHEV. The JV, which was established in December 2007, never has made money, according to the automaker.

LG Chem, South Korea’s largest battery supplier, produces cells for at least three Renault EVs including the Zoe, Fluence and Twizy. Renault assembles packs at its Flins plant in France.