US-Japanese venture rolls out two sporty versions of the same car
Beverly Hills, Calif.
If you're planning a coming-out party, what better place than the Beverly Hills Hotel on Rodeo Drive? One of Los Angeles's most posh addresses, and the gathering place of the stars and Hollywood glitterati, is where the Chrysler Corporation formally unveiled its new Laser last week, a sporty coupe it hopes will also prove a star when it goes on sale through the automaker's Plymouth Division early next year.
The Laser is the latest entry into the increasingly crowded sporty car niche, and it will be going up against a variety of domestic and import competition, including the hot-selling Ford Probe and the well-established Toyota Corolla. It will also be bidding for consumer attention against the new Mitsubishi Eclipse, which also goes on sale in January.
Buyers may notice that the Eclipse and the Laser have some things in common. In fact, quite a bit, for the two cars are being produced at a new assembly plant in Bloomington-Normal, Ill., run by Diamond-Star Motors, a joint venture between Chrysler and Mitsubishi Motors, the automaker's longtime Japanese ally.
Eventually, the factory will produce several products for each of the parent companies, but for now, production will be limited to the Laser and the Eclipse. From a slow start meant to ensure quality control early this month, the production rate will be ``ramped up'' until the Diamond-Star plant can produce 240,000 units a year, half going to Chrysler, the other half to Mitsubishi.
The highly automated plant itself is largely a Mitsubishi design, patterned closely after one of its main assembly lines in Nagoya, Japan. Many of the components in the Laser and Eclipse will likewise come from Japan, though the shift in the dollar/yen exchange rate is forcing Diamond-Star to obtain an increasing number of parts from American-based suppliers.
The design of the vehicle is a hybrid. ``I can't really remember who came up with which part of the car,'' says Richard Recchia, executive vice-president of Mitsubishi Motor Sales of America. The ultimate outcome is an aerodynamic design featuring a sleek, low-slung nose with pop-up headlights and a swept-back rear hatch. There are several versions of the Diamond-Star cars, with the top-of-the-line turbocharged models boasting about 190 horsepower. But except for the corporate ``badges,'' the Plymouth Laser and the Mitsubishi Eclipse are essentially identical.
To some observers, that could spell trouble.
``It's hard when you have look-alike products within a company,'' says David Cole, head of the Center for the Study of Automotive Transportation at the University of Michigan. ``Here they have look-alike products for two different companies.''
But Chrysler and Mitsubishi officials insist they are not worried by the similarities between Laser and Eclipse. ``I'm quite comfortable with the decision ... to make the cars as they exist,'' says Patrick Smorra, Plymouth's general marketing manager.
Mr. Recchia agrees: ``If you're going to share a product in an assembly plant, both of you better have your strongest design,'' he stresses, noting what has happened with the new Mazda Motors plant in suburban Detroit.
Mazda's assembly line in Flat Rock, Mich., produces two product lines, the sporty two-door Mazda MX-6 and the Probe, another coupe sold by the Ford Motor Company, Mazda's affiliate in the United States. While the MX-6 has languished, the Probe quickly became one of the hottest new products of the 1988 model year. And while the new plant is not a joint venture, Ford now buys about 65 percent of its production capacity.
``Mazda is doing a great job supplying Ford with the stronger design,'' Recchia says.
Like the Probe and MX-6, the Laser and the Eclipse will vie for the young, increasingly affluent buyers who have turned the sporty-car niche into one of the fastest-growing segments of the US new car market. The typical buyer for both Laser and Eclipse will be between 27 and 30 years old, with an income of about $30,000 a year.
Even with their look-alike styling, the two carmakers will find different things to talk about, Mr. Smorra says, adding that there won't be any direct competition between the two vehicles: ``It would be silly to go out and knock the Eclipse.''
Mitsubishi will market the Eclipse as an import design. Chrysler will push the Laser as a domestic-made product. It will also offer the longer warranty, the same seven-year, 70,000-mile power-train program covering passenger cars made in its own factories.
If anything, Smorra says, the biggest problem Chrysler will face with Eclipse is limited availability. As production slowly ramps up during the first year, the US automaker will be able to provide barely one Laser a month to each of its 2,500 Plymouth dealers. (And its Eagle division franchises will have to wait a year before they get a four-wheel-drive version of the car.)
For Mitsubishi, the situation is quite different. Because of the limitations of Japanese automotive quotas, the company has remained a small importer - sales this year will total about 120,000 units, including light trucks - primarily selling its products on the East and West Coasts.