Post-manufacturing turf war ‘good for us’: Mazda

THE exit of Ford, Holden and Toyota from local manufacturing by late 2017 could create a sales bonanza for other car-makers, according to Mazda Australia managing director Martin Benders.

Mr Benders, chief of Australia’s largest full-line vehicle importer, said rather than create new opportunities for brands switching to full importer status, the loss of the ‘buy Australian’ mandate of many fleet operators would switch the focus to user-choosers — non fleet-based leaseholders who make their own choice as to what car they drive.

“The (Australian market) dynamic will change (after 2017), because a lot of the fleet business side of things will change as there won’t be factories to feed,” Mr Benders said.

“But in the end, you’re going to get market leadership with the right product that suits the market.

“What product do they not have now that’s suddenly going to change the dynamics from their perspective,” he said.

Mr Benders said the three remaining car-makers had to change something significantly between now and the end of local manufacturing to earn market share.

“What additional product are they going to add?” he said. “I’m not aware of any. Part of their (Holden’s) volume comes out of Commodore, so that won’t be there anymore.



Left: Mazda Australia managing director Martin Benders and a Mazda CX-5.

“What are they going to replace that (volume) with? And where does Commodore sell mainly to now — the fleets.

“Are they going to be able to import a North American model to replace that and still do the fleet business the same way? “You know, they’re the questions I’m asking myself, and I don’t know the answer to that.

“All I can do is look at what happened to Nissan, and what happened to Mitsubishi after they changed to importers.

“There’s a period of time when everything’s disrupted, as they’ve got to adjust themselves from a local manufacturer to an importer, and it doesn’t matter how good you are, it’s very difficult to do,” he said.

Instead, Mr Benders said the car-makers quitting manufacturing would open up opportunities for established full-line importers as the old ways of doing business to build sales volumes disappeared.

“The old days of ‘here’s your job, here’s your car’ — 100 cars on the fleet — are gone,” he said.

“The majority of buyer types now have moved into user-chooser type stays through novated leases, and that’s why Commodore and Falcon are struggling, because they haven’t got that guaranteed business any more.

“If I say to you ‘you don’t have to take your Commodore or Falcon, and you can choose whatever you want’, it could be a SUV, it could be a Corolla, it could be a Mazda3 — that is a big dynamic change, and that’s what’s caused the demise of local manufacturing to some extent.” Mazda cemented the spot as the second-best selling brand in Australia for the first three months of this year after narrowly edging out Holden, despite resurgent Commodore sales.

Mr Benders said from Mazda’s point of view, the shift in the market was already turning many fleet buyers into private customers, “which is where we fight hardest”.

“So we see it (the demise of local car-making) as an opportunity, but I’m pretty sure they’re not going to give it up without a fight, either.” Mr Benders said the Japanese car-maker was only just starting to thrash out a strategy with dealers as to how it could build market share.

“We’re talking about what those people are going to buy if there’s no local Camry, local Commodore, local Falcon, then something like a Mazda6 or a CX-9 or a CX-5 or whatever offers a viable alternative to those,” he said.

“So how do we position ourselves in that space? “That, together with this growth in user-chooser business as companies move away from having big fleets on their books we see as the fundamental dynamic that’s driving the market change, and that suits us to some extent.” Mr Benders said Mazda was not interested in chasing down Toyota — or Holden — to become Australia’s number one brand.

“We’re not going to go after volume,” he said. “We see ourselves as still offering a better alternative in the non-premium segment, if you like, so we’re still very much wanting people to choose us because we’re offing a car that’s better for the discerning buyer rather than just a transport solution.

“That’s where we want to stay.”