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Tokyo show: Slow and steady growth for Mazda

Slow burn: Mazda Motor Corporation president and CEO Masamichi Kogai said the company will increase sales by 150,000 units between now and 2019.

Global Mazda chief says company will remain lean but competitive

Mazda logo29 Oct 2015

By TIM NICHOLSON in TOKYO

MAZDA is planning for sales growth of just 150,000 units worldwide between now and 2019, with the car-maker’s global chief suggesting that the company is content to be a smaller player.

The Japanese car-maker’s president and CEO Masamichi Kogai told Australian journalists that the focus was on producing appealing vehicles, rather than chasing huge sales increases.

“Our intention is not to become a big player in the industry, but rather a company to pursue the essence of the vehicle with the fun-to-drive aspect,” he said at the Tokyo motor show through an interpreter. “Although we are a small company with a small share, we are really going to pursue that essence.”

Kogai-San said the modest target for growth should ensure that the company does not need to expand its production facilities beyond its existing plants.

“Currently our production capacity is 1.5 million units. In the fiscal year ending March 2019, our sales volume target is 1.65 million units, so we are thinking of producing enough volume without building new plants.

“To sell 1.65 million units, to supply that vehicle from the current plant size, we really need to have them utilised at full capacity. And then if we are able to consider that the demand, and the trend will increase or even maintain, then that is probably the time we need to start studying about the next plant.” Kogai-San said the company did not want its volume to be dictated by sales targets.

“Our policy is to provide the volume that meets the customer demand. We don’t want to put a strategy (in place) where we put sales volume target first and then we see how the demand goes. We just provide what is needed.”

While Mazda has a small presence in developing global markets, Kogai-San said he is keen to expand and appeal to fans of the brand.

“Even though we are in the emerging markets as well, we don’t have the emerging-market dedicated models. We sell global models to those markets.

“Those customers who purchase Mazda products in emerging markets, we want to establish good relations with those customers and have a special bond, so when they are ready to replace their cars they will come back to Mazda because they love Mazda vehicles and then we can increase the number of fans one by one.”

Kogai-San said that the company had become far more efficient since it split from Ford, where it shared models between brands. Now, certain models share common platforms with other models in the Mazda portfolio.

He added that the advantage of being a relatively small player in the global industry meant it could more easily focus on brand image and be selective about the markets it wants to play in.

“The advantage of small-to-medium scale is we don’t have to go to all the regions in the world, but we can look at certain regions and then put importance and emphasis on the markets that we are in,” he said.

“And also I think the brand image is easy for customers to recognise. Because the design of all of the different models is sort of similar – projecting the same message. That is the recognisable brand image that we project.”

Kogai-San ruled out a return to the premium sector – its Eunos luxury brand experiment failed in the mid-1990s after seven unsuccessful years – adding he did not want Mazda customers to have to pay a premium for their cars.

“Lots of times questions are asked – is Mazda trying to become a premium brand? But that’s not what I tell employees at all. If I say we aim to become a premium brand, our R&D and engineering staff might start building the vehicles with a high cost and that is not good for our customers.”

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