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Friday, 30 March, 2001, 13:59 GMT 14:59 UK
Mitsubishi misses mobile targets
man with old fashioned mobile phone
Mobile phones have developed fast, but Europeans can be slow to adopt new features
Japan's giant manufacturer Mitsubishi Electric has missed its mobile phone handset sales targets by almost a third.

The market shrank quite a bit from the latter half of 2000

Michio Nakanishi
The Japanese mobile maker aimed to sell 27 million mobile phones across the globe for the year ending in March, but only managed to shift 18.5 million.

And sales in the US and Europe were especially bad, missing targets by 50% and 44% respectively.

Japanese handset makers have found it tough to break into European markets, finding that Europeans are not so keen to upgrade their phones with all the latest features as the Japanese.

And the US slowdown has also taken its toll, with weakening demand.

Ambitious new targets

Japan was the only market where Mitsubishi attained its sales targets of seven million, and has set new goals of 8.5 million this year.

But it has set itself ambitious sales targets for this year nevertheless, aiming to sell global 28.2 million handsets.

Mitsubishi sales, year to March 2001
Japan - 7mn
US - 2mn
Europe - 9mn
Missed targets
Japan - 7mn
US - 4mn
Europe - 16mn
New targets
Japan - 8.5mn
US - 2.5mn
Europe - 16mn
And it wants to sell 16 million of these in Europe, almost double the number it sold there this year.

Rival manufacturers are also facing tough times, with European firms Nokia and Ericsson recently announcing job cuts and reduced sales targets.

"The market shrank quite a bit from the latter half of 2000," said Mitsubishi's Michio Nakanishi, senior vice president.

Mobile cultures

Mitsubishi has said that it may seek alliances with other handset makers to research its markets better, and ensure that it meets its vendor's requests.

Mitsubishi was one of the first Japanese handset makers to venture overseas, but now faces stiff competition.

There are also different user preferences among the Japanese and European markets.

"I don't think downloading pictures or music will be popular....they [the US and Europe] have a different culture, what is needed instead is to enhance email functions," said Mr. Nakanishi.

Mr. Nakanishi said that the company will offer less sophisticated handsets to Europe in order to better establish the brand, before adding more advanced features.

Upgrade network

The poor sales figures are also due to Mitsubishi's failure to deliver the promised GPRS (General Packet Radio Service) systems in Europe.

GPRS systems offer speedier mobile services before the advent of the super-fast third generation networks.

Orange, the loss-making mobile phone subsidiary of France Telecom, has said it will launch its next generation GPRS mobile phones in France and the UK this summer.

They work by maximising the use of radio channels and allow many more users to access a network at the same time.

But Mitsubishi is confident that its GPRS-compatible handsets will be available by April 2002.

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See also:

22 Mar 01 | Business
Orange sets date for mobile upgrade
27 Mar 01 | Business
Ericsson and Nokia cut jobs
15 Mar 01 | Business
Nokia lowers sales forecast
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