Mitsubishi Cuts Electric Car Price in U.S. to Overcome Obscurity

Mitsubishi Motors Corp. (7211) lowered the price of its i-MiEV electric car in the U.S. by 21 percent to spur demand for a vehicle that attracted only a dozen buyers last month.

The 2014 i-MiEV hatchback will sell for $22,995, down from $29,125 for the previous model, the Tokyo-based company said in a statement late yesterday. The car qualifies for a $7,500 U.S. tax credit and a California rebate of $2,500, dropping its price to the equivalent of $12,995, Mitsubishi said.

“At that price, it’s not just one of the cheapest electric cars you can buy,” said Ed Kim, an industry analyst for AutoPacific Inc. in Tustin, California. “It’s one of the cheapest cars, period -- particularly in California.”

The move follows price cuts for electric vehicles at Nissan Motor Co. (7201), General Motors Co. and Honda Motor Co. U.S. sales of Nissan’s Leaf electric car more than doubled after prices were reduced.

U.S. Leaf sales rose 30 percent to 2,003 in November, Nissan said yesterday. Nissan’s Leaf sales through November totaled 20,083, exceeding its combined deliveries of the car from 2010 through 2012. Sales of Mitsubishi’s i-MiEV fell 71 percent to a dozen units.

“Everyone has been doing massive discounts for their plug-in models, so it’s not really a surprise Mitsubishi is getting in on that game,” Kim said in a phone interview. “I’m not sure having the cheapest electric car is so important at this point, since the people buying plug-in vehicles tend to be the ones who can already afford them.”

Mitsubishi Motors fell 1.8 percent to 1,103 yen at 10:39 a.m. in Tokyo trading. The shares have risen 24 percent this year.

To contact the reporter on this story: Alan Ohnsman in Los Angeles at aohnsman@bloomberg.net

To contact the editor responsible for this story: Jamie Butters at jbutters@bloomberg.net

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