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Mazda warns of global price rises

Failed experiment: Mazda launched its Eunos sub-brand in the early 90’s but models like the 500 sedan failed to make an impact and the brand was soon killed off.

Higher tech could force premium pricing but Mazda won’t resurrect luxury sub-brand

Mazda logo10 Jun 2014

By BYRON MATHIOUDAKIS in HIROSHIMA

MAZDA’S incoming chairman has warned of inevitable price rises in the future, as maintaining current pricing levels against what he considers less sophisticated opposition will be difficult.

This means the cost of the brand’s vehicles will most likely edge closer to premium marques over time, as Mazda remains dedicated to nurturing affordable, yet premium levels of quality and engineering throughout its range of passenger cars and SUVs.

According to Mazda Motor Corporation representative director and vice chairman of the board, Seita Kanai, who will take up the role of chairman from next month, technologies including efficient SkyActiv drivetrains, multi-link rear suspension systems and advanced driver aids do not come cheap.

However, despite the opportunity to match most luxury marques, he insists that the company will resist the urge to embark on another Eunos luxury offshoot like it did in the early 1990s to take on Toyota’s Lexus, Nissan’s Infiniti and Honda’s Acura brands head-to-head.

“Mazda vehicles are in a manner very close to the premium vehicles,” he told GoAuto in Japan last week.

“Seeing it that way, we maintain the pricing but make an effort.

“(However) maybe our prices will rise closer to the premium brands eventually… to offer a premium product at premium pricing, that is something that we would like to do.

“But Mazda cannot decide (on its own) whether our products are premium enough or not. That is something the customers will decide anyway.

Kanai-San said that there are a number of reasons the Eunos luxury brand did not succeed in the 90s, but it was not looking to attempt it for a second time.

“One of the reasons we failed last time was because the technology was so poor – it just was not so good. This is my honest view,” he said.

“Another reason is that we didn’t have enough resources – especially in terms of people and money back then.

“If we support an upscale brand as well as a mainstream brand then you have to develop a really different type of model for both. Back then Mazda didn’t have enough resources to do that.

“While we had multiple sales channels a long time ago, I don’t think we will take that strategy again any time soon.”

In late 1992, Mazda decided to disband the Eunos/Xedos sub-brand project – as well as the Amati 100 V12 luxury sedan that was meant to take on the Mercedes-Benz S-Class but never saw the light of day – in the face of the spiralling financial problems that ultimately led to the Ford Motor Company taking control until the end of the 2000s.

It is worth noting that Australia’s top-selling vehicle so far in 2014 – the Mazda3 – is running at a richer (and thus more profitable) model mix than the company forecast, with around 80 per cent of buyers choosing models that retail at about $25,000 and over.

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