Mazda “Zoom Zooms” Its Way to Growth
 |
Special to The Auto Channel
By Jim Koscs
AIADA
Contributing Editor
Even with the economic turmoil that has characterized much of 2008, Mazda has every reason to be optimistic about future stability and growth. A recent string of successful models has broadened its customer base and yielded market share growth. The all-new Mazda6, introduced this past August, vaulted Mazda into the thick of the midsize segment, and a new generation of Mazda’s global bestseller, the Mazda3, arrives in the first quarter of 2009. A look back over the past seven years — courtesy of Edmunds.com — shows Mazda gaining market share while reducing incentive spending. From 2002-2006, Mazda held a steady 1.5-1.6-percent share. That jumped to 1.9 percent in 2007 and stood at 2.1 percent in August of 2008. Mazda’s incentive spending, as calculated by Edmunds, was $1,319 per vehicle through August compared to $2,238 in 2002. Sales hit 296,000 in 2007 and, through August, had been on track to exceed that figure this year. Mazda has 700 U.S. dealers.
Mazda’s resurgence can be attributed to its building one of the
best-defined brand identities in the industry, and offering a product line
that mostly matches it. Mazda calls it “Zoom Zoom,” and it has
turned into more than just a marketing mantra. Company executives and
designers say that by infusing new Mazda designs with “the soul of a
sports car,” the brand has tapped into a customer base that eschews
mainstream design but still demands mainstream
value and quality.
 |
|
The Mazda CX-7 is a crossover sport-utility |
Younger Buyers
And that customer base is young
— the second youngest in the industry with a median age of 41,
according to Dave Dildy, Group Manager, Vehicle Line, Mazda North American
Operations. Mazda’s youngest customers made the Mazda3 a surprisingly
big hit five years ago. The MX-5 Miata — the world’s
best-selling sports car ever — draws Mazda’s oldest
customers.
Jessica Caldwell, a market analyst for Edmunds.com, likens Mazda’s
customers to those of Volkswagen. “Both want something a bit
different from the mainstream,” she said. “Mazda is not a niche
brand, but its niche-like product strategy finds success with lower volumes
in large segments. Mazda is very good at differentiating itself from
large-volume competitors. Its ‘zoom zoom’ marketing has
captured the brand identity and they’ve stuck with it.”
In
mid-October, news broke that Ford was considering selling part of its 33.4
percent controlling share in Mazda. And as Ford sought to shore up its own
finances, Mazda switched its financing source from Ford Motor Credit to
Chase Auto Finance.
“The change in credit arms should not be much of an issue for customers,” said Caldwell, “but dealer personnel need to learn new financial products and procedures. They were familiar with one system and now suddenly they need to learn something new.”
Going Big on Midsize
This past August, Mazda
introduced its new-generation Mazda6, upgrading the model from
“tweener” to true midsize. At the moment, Mazda is seeking to
grab a slightly bigger slice of the midsize market, not to unseat its
leaders. The company expects to sell 80,000 in the Mazda6’s first
full-year in the U.S., plus another 20,000 for Mexico and Canada. Mazda can
source more than 100,000 cars from the flexible Flat Rock plant, if
necessary.
 |
|
The 7-passenger Mazda CX-9 has won biggest |
The product strategy is to combine standout styling with sporty performance and to offer a few more luxury amenities than competitors do. The MSRP range of $18,550 to $28,260 encompasses 4-cylinder and V6 engines, three transmissions and four trim lines. Factory options are limited to three packages, complemented by about a dozen accessories. The 2.5-liter, 170-horsepower, 4-cylinder is a new Mazda engine and is offered with 6-speed manual or 5-speed automatic transmissions. The 3.7 liter, 272-horsepower V6 is a Ford design built by Mazda in Japan and teamed to a 6-speed automatic — rare in the segment. EPA-rated fuel economy for both engines is competitive for the segment.
Mazda projects that 75 percent of Mazda6 customers will choose the 4-cylinder, and of those, 15 percent will take the 6-speed manual transmission. That would be high for the segment, and some midsize competitors do not offer a manual transmission at all. Most V6’s are expected to be high-end Grand Touring models.
The new Mazda6 is designed to attract older buyers than the previous
model, buyers who are willing to spend more. “We’re targeting
the 30-55 age group, with emphasis on over-35,” said Dildy. The goal
is to raise the average transaction price to about $24,000, up from $19,000
for the previous model. Mazda is also reducing Mazda6 fleet sales to about
10 percent, down from nearly 24 percent for the previous car in its last
few years. The company used direct
mail and Internet communications to
reach current Mazda6 owners, offering lease extensions until the new car
arrived and a $500 “owner loyalty” cash incentive.
Compact Car, Big Impact
Inspiration to move the
Mazda6 upward came in large part from Mazda’s success with the
Mazda3, which brought upscale design, performance, and content to the
compact segment. Especially with rising fuel prices, the idea of the
premium small car has taken root in the U.S. (also helped by MINI and
Volkswagen), and now other mainstream brands are augmenting their compact
lines with upscale variants. Originally projecting U.S. Mazda3 sales of
about 70,000, Mazda found itself scrambling to meet demand for 120,000 and
was still setting monthly sales records for the 5-yearold Mazda3 as late as
this past summer. Mazda continued to expand the Mazda3 line, adding the
premium Grand Touring trim line and the high-performance Mazdaspeed3 model.
“The Mazda6 will probably not have as much of an impact in its segment as the 3 did for compacts,” said Caldwell of Edmunds.com. “It’s harder to stand out in the midsize segment. The 3 really stood out by offering two body styles, two engines, luxury and high-tech amenities that were not the norm for compacts.”
Crossing Over
Never able to grab a toehold in the
minivan category, Mazda has cast its lot with crossovers, the 5-passenger
CX-7 and the 7-passenger CX-9, both designed expressly for the U.S. market.
The CX-9 won the North American Truck of the Year award and Motor Trend
magazine’s “SUV of the Year” and has topped magazine
comparison tests. Mazda scored another surprise hit with its Mazda5, a kind
of mini-minivan, offering 6-passenger seating and dual sliding doors, but
with an un-minivan-like 28 mpg highway fuel economy. “When we
launched the Mazda5, many asked, ‘Why?’” said Barnes.
“But we saw the move to smaller, more sensibly sized vehicles. The 5
had its best month ever in August, and that’s with very little
marketing support. We asked for and got another 10,000 allocated to the
U.S. this year.” A successor model is in the works.
 |
|
The Mazda RX-8 sports coupe is the |
Barnes also confirmed that Mazda is pursuing higher mpg technologies. “The goal is to improve our global fuel economy 30 percent by 2015,” he said. “We are working on a new family of gasoline piston engines, a new version of the rotary, and a clean diesel.” In addition, Mazda continues to research hydrogen — but for burning, not for fuel cell electric vehicles. “Our rotary engine is uniquely suited to using hydrogen as a fuel,” Barnes said.
Still Sporty After All These Years
Mazda helped
reinvigorate the sports car segment in 1978 with the first RX-7, and then
single-handedly revived the market for small roadsters with the MX-5 Miata
in 1989. That model will get a makeover for 2010. Mazda caused a bit of a
stir among sports car purists when it first offered a power extractable
hardtop a few years ago, but it now accounts for nearly half of Miata
sales. Although it would not comment on future products, Mazda reaffirmed
its commitment to the rotary engine, which is currently used only in the
RX-8 sports coupe. Specifically, the company plans to boost fuel economy
for the unique engine. Jordan Meadows, Design Manager, MNAO, said that the
success of the Mazda3 strengthened the company’s resolve to create
more striking designs and to tune its vehicles for sporty performance.
“We want to appeal to customers who want to make a style statement,
even with an everyday product,” Meadows said. He likened
Mazda’s design approach to that of Apple: “You can have a bland
PC or an iMac, a cell phone or an iPhone. It’s about making an
emotional connection with customers.”
