Mitsubishi Motors on Tuesday held an opening ceremony for a plant in Indonesia that is expected to supply multipurpose vehicles to Nissan starting as early as 2019. MPVs, commonly known as minivans, are widely popular in Indonesia.
The 65 billion yen ($585 million) plant, located in Bekasi regency in the province of West Java, is operated by a joint venture of Mitsubishi Motors, trading house Mitsubishi Corp. and a local partner and has an annual output capacity of 160,000 units.
The factory will initially churn out 30,000 units of Mitsubishi Motors' Pajero Sport sport utility vehicle. It will also produce 80,000 units of an MPV to be released as early as this fall. The Colt L300 commercial vehicle will also be made.
The plant's output is expected to reach 140,000 units a year. With the remaining capacity, Mitsubishi Motors will be able to supply Nissan, President Osamu Masuko said.
Nissan, for its part, may produce Mitsubishi Motors vehicles, said Carlos Ghosn, chairman of both automakers. Nissan became the largest shareholder of Mitsubishi Motors last year by taking a 34% stake.
Nissan has been struggling in Southeast Asia. Its Asian sales, including the Oceania region, accounted for just 6% of its global total of 3.99 million vehicles in the April-December period.
Family-oriented MPVs make up 70% of the new-car market in Indonesia, while low-cost green cars represent just shy of 30%. Lacking an attractive MPV offering, Nissan holds a mere 4.2% market share in the country, trailing Mitsubishi Motors' 6.6%.