By Jorn Madslien
BBC News Online business reporter at the Geneva Motor Show
Is the Colt a hint at Mitsubishi's future direction?
The new Colt, which has made a major comeback at the Geneva Motor Show, could provide a much needed boost for troubled Mitsubishi Motors.
The Japanese car maker has high hopes for the Colt, predicting sales of 100,000 per year in Europe, sharply up on old Colt sales which only reached 800,000 in 25 years.
With annual sales of the old Colt reduced to a trickle by the end of its life, only one conclusion could be drawn, Mitsubishi Colt project leader Jan Wouter Kleinjan told BBC News Online.
"We lost our way with the old one."
As it happens, Mitsubishi Motors has lost its way in more ways than one.
The company has crashed into the red and is now predicting operating losses of 105bn yen (£525m; $945m) for this financial year - a forecast which shocked shareholders who had been told as recently as in December that the losses would be less than half that.
Couple this with debts of more than 1bn yen, and the situation looks rather bleak.
Much of the car maker's current problems arose from a disastrous push into the US youth market where its rather indiscriminate offers of credit - along with discounts for rental firms and companies - initially helped lift its market share.
But soon it all came down like a house of cards as a growing number of their young customers defaulted on their loans.
Then, as soon as Mitsubishi tightened the purse strings, sales took a dive - down 25% in the US during 2003.
Bad news indeed, this, given that the American market accounts for about a third of Mitsubishi Motors' sales.
The crunch forced the car maker to hammer out a new business plan, due to be presented by the end of next month.
Mr Kleinjan: "In this darkness, the only light that is shining is Europe"
The plan is expected to include a call for fresh cash from its share holders.
This would bring forth its ally, DaimlerChrysler, which in 2000 acquired a 37% stake in Mitsubishi Motors.
The German-American car giant may be asked to inject a whopping 70 bn yen into Mitsubishi Motors, about a third of the total required.
DaimlerChrysler has not yet signalled what its answer would be, but it seems it has already decided to ship in the boss of its Smart car division, Andreas Renschler, to orchestrate a restructuring operation.
Reliability issues would need to be addressed, as would Mitsubishi's image and there may even be changes to the senior management.
Mr Renschler is apparently supposed to work with Mitsubishi Motors chief executive Rolf Eckrodt, though there have been reports that he might replace the current chief at the end of this year when Mr Eckrodt is due to step down.
By then, the hope is, Mitsubishi's European division should be leading the way with the new Colt at the helm.
Smaller and cheaper than its predecessor - and with a supposedly "unique silhouette" that gives it a mini-people carrier shape - the Colt is gunning for the market carved out by Honda's Jazz.
"In this darkness, the only light that is shining is Europe," Mr Kleinjan said.
Mitsubishi Europe's situation is already promising.
"For 2003, Mitsubishi Motors will post its first profits ever in its European history of more than 30 years," said chief executive Rolf Eckrodt.
This turnaround in Europe has come a year earlier than planned, Mr Eckrodt said, adding that it arose from a major restructuring of Mitsubishi's European organisation, its management structure, its distribution arrangement and the positioning of the Mitsubishi brand.
The Colt shares 60% of its components with the Smart ForFour
The Colt has been a central part of the process.
As the first product of Mitsubishi Motors' alliance with DaimlerChrysler, Mitsubishi could afford to create the Colt's looks since it saved on other parts of the car.
The Colt shares 60% of its parts, including its platform and engine, with Smart's ForFour.
The alliance has "worked extremely well for this car", insisted Mr Kleinjan.
But whereas the Smart four seater has been slammed by critics for its departure from the basic values that made the brand famous - a tiny two-seater that is easy to park - the Colt's reception has been positively warm.
Some observers see this as a sign of hope for Mitsubishi.
If the DaimlerChrysler deal frees up cash for modern design from Mitsubishi's limited development budget, than the marque might just have a promissing future after all.