Parts+Labor?
What kind of bank they making off these babys.

 

Mitsubishi would be lucky to achieve break-even on this car. In reality, it's probably a loss-leader. The Lancer Evolution is an extremely low volume - less than 20,000 globally per year - car. It's real value to Mitsubishi is not in sales income or profits, but as a technology and engineering showcase and as a performance halo car.

 

thats a nice theory, but they wont make cars if they arent making money... i bet they pocket at least 5000 per car to the dealer, then the dealers pocket whatever they can after that which is in the ballpark of 500 to 5000 or more dependant on location and the person buying the car

 

Sure they do. The Honda S2000 was a loss leader for many years. Even cars like the Toyota Prius were also loss-leaders initially (might not be anymore since they are selling so many of them now - 60,000+ for 2006).

Why would automakers sell cars at a loss or at break-even?
They can justify it because the marketing value of an automaker offering a car that can offer the automaker's brand a performance-cache' or a green-cache' that can outweigh the financial loss-per-car.

 

not in mitsu's case, they have done enough of the loss per car per year thing, thats why they have been hurting financially.... however, i seriously doubt they are losing money on the manufacturing of a car... they were hurting, bring the evo to the us, not hurting so much anymore..... the car is desired, in movies and world famous.... i would almost guarantee they profit at least 10% on each car sold

 

I agree with Bigric although I dont doubt the S2000 and the prius both may have started off as a "loss leader" but this would only be due to reasearch and development costs which still needed to be covered especially in the case of the prius... Mitsubishi is a corporation and that means despite doing the occasional good deed they are out to do one thing make money.. I would agree they have to be making at least $5,000 per car for it to be worth while for them to even import evo's to the US. Its not like mitsu is paying retail prices for the brembo's or the wheels or anything like that. when you buy 20,000 of anything per year you get a huge discount which allows the evo to make they money even with the expensive parts it contains.

 

Two years ago, the Evo was the only car in Mitsu's line up that was actually making a profit in america. This fact is quoted from Car and Driver and they quoted it from Dr. Evo himself. You may think that Mitsu spent alot on R and D for the Evo but I don't think they really did. First of all, its always been based on some econo car chassis so that cut down cost significantly. Second of all, the performance development took place over 13 years (the suspension and brakes from a VII, VIII, IX are actually the same as the ones on a VI)

 

You do not know what you're talking about. There are cars on the market that the company isn't making a dime on. They do it for reasons other than profit. I'm not saying this is the case with the EVO, but there are examples out there as noted above and others.

 

so people will notice the name when they shop for a car.. for example,, why toyota=good for earth link, honda= reliable, BMW= sporty, benz=luxury, and volvo=safty... you see the point.. is advertithing

 

mitsu= no warranty


we are discussing mitsu...no any other car... and i refuse to believe that a company <--- exists to not make money... they may make 1 model that doesnt profit as well as the others or they may have taken a bite in the **** for... but its ultimate goal is to make money. If they did produce a car to not profit from, it would be to boost the profit in the other cars... their arent any to very few companies out there that do things just to help people out... they are about making some cash so the CEO's can scandle it away somewhere

 

Mitsubishi Motors operates at a loss in North America. They're trying to break the market away from the Honda's and Toyotas... It's not because they're nice, it's so they can establish long term profitability... When people buys lancers like civics, evos like 350z's, then they'll think about making profits.

 

+1

 

Mistu shows a huge loss every years. Thats just good biz. If they showed a multi-million $$ gain every year taxes would rape them. Its common practice for large companys to show a loss and a gain maybe once every 5-6 years.

Do you honestly think mitsu could loss millions per year and still be able to operate?

 

Given that amount of engineering that was already done with the CT9A chassis I would be willing to bet they make a profit on the Evo.

Do you really think it costs twice as much to construct an Evo as it does a lancer?

The 4G63 has been around since oil was something alive. So, not a whole lot of development cost there. They manufacture the turbo and Mitsu is huger so, I'm sure they get other divisions of Mitsu to make a lot of other parts. I'm sure they have agreements with Brembo, Recaro, and Momo to get their products at near cost.

So what's left? The AWD system and some new body panels. That can't cost that much.

 

Mitsu looses millions a year in the US, just as Ford, GM, Nissan and Subaru (and many others for that matter) have done. There is no majic deduction that companies can take that allows them to show a loss, while actually they are making money. There are expenses that do not impact cash flow, such as depreciation or amortization, however, they are still expenses.

Mitsu and Subaru are owned by giant Japanese conglomorates. The losses in the US market are off-set by gains in other business units. When Ford and GM experience losses, the hope is that their auto businesses in other parts of the world off-set the loss in the domestic market. When this isn't the case, the losses come out of cash reserves. When cash reserves are gone, the company must take drastic measures such as raise additional capital through an equity offering, file for Chapter 11 protection under the USBC or in a few rare cases, get a direct "loan" from the government as Chrysler did in the 80s.

The question for Subaru and Nissan a few years back and currently facing Mitsubishi is how long you take the losses. For the most part, as long as the long term outlook is for a return to profitability, they'll continue to absorb the losses. This long term outlook is what has Mitsu concerned. Can they generate the sales needed to be profitable? The answer is no, not with the current product mix. That is why the new Outlook small SUV and the new Lancer are so important. They must both sell at rates much better than their predecessors or the chances of Mitsu staying in the US are slim. Fortunately, as both Subaru and Nissan have shown, if you get your product right, the business will be there.

Remember, if Mitsu wasn't really loosing money, why would they be considering abandoning the US market?