By on December 17, 2013

Mazda-Dealership

Akira Marumoto, Mazda’s executive VP for North America, said that the company will revamp its dealer network as it aims to increase U.S. sales by a third over the next two years.  Automotive News reports that underperforming dealers will be culled and dealers in poor locations will be encouraged to open up new stores in more promising places. The company has identified 35 key metropolitan markets where it will focus its sales and marketing efforts. Mazda is highly dependent on North American sales with almost a third of its global sales taking place here.

Mazda currently has 637 franchised dealers in the United States. Marumoto, speaking at last month’s Tokyo auto show, wouldn’t say how many U.S. dealers the company thinks it needs, or how many dealers might be jettisoned or moved, but he did say that the company will be “aggressive” and that “Our initiatives are bearing fruit.” 2013 will likely be the fourth year in a row that Mazda had increased its U.S. sales.

Masamichi Kogai, Mazda’s new CEO set a goal to sell 400,000 units in the fiscal year ending March 31, 2016, up from a projected 300,000 units in the current fiscal year, which itself would be an increase of about 10% over the previous fiscal year that ended March 31, 2013. Through November, sales are up 5% over last year. 400,000 units would be a record for Mazda, whose previous best year was 1986, when it sold almost 380,000 cars and light trucks in the U.S. Marumoto said that most of the additional 100,000 U.S. sales will come from the CX-5 small crossover, which competes in a hot segment, and the newly redesigned Mazda3. Lower volume vehicles like the Miata MX-5 and Mazda’s larger CUV offering, the CX-9, are hoped to show incremental increases in sales with greater profit margins than the high volume vehicles. The introduction of a diesel engine is hoped to increase Mazda6 sales as well.

Marumoto said that the CX-9 and the Miata will soon be redesigned. “Toward the fiscal year ending March 2016, we will have a new CX-9, and those are the models where we are prioritizing for profit improvement,” he said. “The MX-5 Miata, because it’s a sports car, they sell quite well in the first three years.” The next Miata is being developed in conjunction with Fiat, which will sell the roadster as an Alfa Romeo.

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59 Comments on “Mazda to Upgrade U.S. Dealer Network, Cull Underperformers, Focus On 35 Key Markets...”


  • avatar
    namesakeone

    I always wanted to buy a car at Bountiful Mazda.

  • avatar
    Jacob

    This wouldn’t be a bad idea. Mazda dealers look pretty bleak right now. I mean, the couple I have seen here in Texas look like a parking lot of a 7-11 compared to football field size Ford and Toyota dealers.

  • avatar
    Tinker

    I wonder if shutting down/moving some of their 637 dealers will result in MORE irritated customers, rather than less. If I had known they were going to do this, I’d not have bought a Mazda in the first place.

    • 0 avatar
      Tosh

      Sounds like you bought the Mazda based on dealer location, not on liking the actual product?

      • 0 avatar
        Lorenzo

        Most people choose both together. If I wanted to buy a certain make/model and the nearest dealer was 60 miles away, I’d probably look for a different car with a dealership more conveniently located. There are also very good dealers out there with good repair shops, but not the volume the maker would like, especially dealers with multiple brands and large used car operations. Like Hollywood stars, some brands hassle dealers over top billing.

        • 0 avatar
          npaladin2000

          I’d certainly never buy a car if there were no reasonably convenient dealer. That’s why I never considered FIAT, or MINI. Nearest dealers are over an hour away. Same with Infiniti, and Audi isn’t much better.

  • avatar
    OldandSlow

    Nothing against Mazda – I own one – but with so few models and without the inertia of the Japanese Big Three, who build most of their offerings in North America, they’ll be lucky to surpass Subie in sales.

    Subaru has fewer dealers in this part of Texas. Yet, I see more Subies on the road. I think increasing sales is going to be more than an exercise of building more of them and the customers will come.

  • avatar
    eggsalad

    Here’s why Centennial Mazda in Las Vegas is an under-performing dealer:

    I want to buy a stick shift CX-5. They are not strong sellers, as the one I’d like to buy has been sitting on their lot since August. Yet still, it has a non-negotiable, $3000 ADM sticker on the windshield.

    The CX-5 is interesting at $22k. At $25k, it becomes a lot less interesting. I realize that dealers are independent businesses and have a right to sell cars at any price they like, but a 15% additional markup just chases customers away.

    Cull that dealer, Mazda N. A.!

    • 0 avatar
      TMA1

      That’s crazy, I don’t know how dealers can get away with that. It just drives me off the lot. I’ve seen a local Mazda dealer and a Nissan dealer that do that. Window sticker? MSRP? Haha, just check that piece of paper taped to the rear window, +$3,000.

      At least the Mazda dealer was throwing in mandatory pinstripes and door guards for that price.

  • avatar

    If I could, I step right into the photo and buy that brand new MPV.

  • avatar
    npaladin2000

    The dealer experience needs a bit of attention, yeah. It varies wildly from dealer to dealer. The closest dealer is basically a hole in the wall, former Saturn dealership that is actually too small to hold Mazda. The next closest one is this beautiful Mazda-VW dealership with a whole building dedicated to Mazda sales, and a very nice parts and accessories department attached to the service area.

  • avatar
    Kyree S. Williams

    Mazda doesn’t suffer from the reliability reputation of one of the European brands. Most people don’t know about the rust issues. Mazda’a cars also aren’t hideous, and they are very good at what they do. My bet is that Mazda is plagued by a lack of exposure, and the fact that the other brands (including Volkswagen) know how to capture a buyer before he/she gets very far. I’m not sure that shuttering dealerships will help this…

    • 0 avatar
      mike978

      I agree with most of what you wrote. I don`t think there will be a net shuttering, maybe a few dealers close (under performing) and some open). It sounds like they are targeting their limited media budget at certain metropolitan areas.

  • avatar
    Astigmatism

    Lord knows this is needed. We test-drove a CX-5 at a linoleum-floored, straight-outta-1970 dealership (with barely-functioning A/C on a 95-degree day) tucked into a highway offramp in a bleak stretch of exurban New Hampshire, accompanied by a salesman who couldn’t give a straight answer on any of the option packages or available features. We price-shopped a half-dozen dealers (there are a bunch close by), and ended up buying from another linoleum-floored, straight-outta-1970 dealership, complete with sad plastic triangles and balloons, and a gauntlet of Glengarry Glen Ross extras jostling to make the sale when we walked in the door.

    The Toyota dealership we visited looked like the Lincoln Memorial by comparison. If I hadn’t known as much about the cars as I did going in, I don’t think we would have braved another Mazda dealership.

    • 0 avatar
      FreedMike

      Seems they have the same problem Lincoln does in this respect. I can think of four Mazda dealerships here in Denver – one looks just like the one in the picture above, and the rest are either “meh” or duplicates of the one you describe above.

      • 0 avatar
        AlternateReality

        That’s very troubling, as the branding shown in the photo above was rolled out to the dealer network in 2007. And I thought GM dealerships were slow on the uptake…

        • 0 avatar
          CoreyDL

          The only Mazda dealer I’ve seen really is one in Florence, KY. It got the new design around 07 I believe. It always looks bleak and unfinished though. Who are they trying to pull in with the late 90s/early 00s industrial metal + neon design? It doesn’t work for me, it just looks like a cheap warehouse.

    • 0 avatar
      Lorenzo

      What have you got against linoleum flooring? That was a huge step up from painted concrete, and it assures you there won’t be an extra markup to pay for new carpeting every three years. All those dealers in New Hampshire should be closed anyway. If Mazda isn’t going to beef up its rustproofing, it may as well bail out of the snow zone and concentrate on the sun belt.

  • avatar
    jaje

    Add the skyactiv-d to the CX-5 and give the US buyers another reason to consider Mazda by having the only diesel option in a CUV in the US market. They get 40mpg after converting over to US gallon so why not put them here too?

  • avatar
    Cabriolet

    Many Mazda dealers are very bad. Their big problem is the price of parts. Mazda is aware of this problem and lowered their parts prices back in late 1990. Of course many of the dealers kept the higher prices in place and still do today. When i purchase Mazda parts i always go online to a few dealers that discount their prices. We had one dealer in Great Neck, NY that wore a mask when selling you parts. One day i needed a front brake caliper kit and i was quoted $75.00 for three pieces of rubber. I purchased aftermarket for $3.95. I have owned a few Mazda,s and loved the cars but the dealers were quite poor.

    • 0 avatar
      28-Cars-Later

      “We had one dealer in Great Neck, NY that wore a mask when selling you parts.”

      He didn’t say things like “It doesn’t matter what we charge, what matters is our plan” did he?

    • 0 avatar
      Dweller on the Threshold

      Are lots of crummy dealers that don’t make any money the cause or the effect of Mazda’s plight?

      Gotta get the right answer here. If the product is good according to word of mouth, CR, etc., etc., people will still venture into a low-end dealership, hold their nose, and at least try to buy. Some will succeed. No one will be thinking about the price of parts or other downstream dealer skulduggery.

      Most people aren’t so attuned to sales tactics that they’d recognize Shelly (The Machine) Levene on sight. They assume coffee is for everyone. My local dealer is not too hot, but I’ve managed to get whatever I needed to keep my ’96 Miata on the road. I guess I’ve never been outraged by the price of an OEM PCV.

      But if the product ain’t so great, or if the product’s benefits don’t penetrate into anyone’s skulls (like, becuase they think Mazda isn’t sold in their town), then it’s hard to see how that is really successful entrenchment. Sounds like merely surrendering more territory. Unless, perhaps, Mazda is thinking that this is part of their 15-year plan, when it seems to me more like they’d better have an idea of their 2-year plan. I just don’t see closing dealerships as a way to survive the next few years. Risky business.

  • avatar
    FreedMike

    Probably a good move on Mazda’s part – they need to retrench. But the fact that they’re making their dealers clean up their act tells me they’re not going down the Suzuki / Mitsubishi road to nowhere.

    By the way, that dealer design above looks just like a newly renovated dealership here in Denver, so that appears to be their new corporate “look,” and I like it.

    • 0 avatar
      Dweller on the Threshold

      “Probably a good move on Mazda’s part – they need to retrench.”

      I agree in part. *If* they think they need to retrench, I’m not so sure that retrenching = closing dealerships. That way lies the death vortex.

      If they think they need to retrench *by closing dealerships* then the game is already lost.

      *I* would rather seem them hang on for dear life to market share with the tremendous investment in new product that they’ve recently made. Retrench with a massive advertising campaign now that they’ve got the awards/publications to back up the product.

      If that still doesn’t work then, yeah, shut down some dealers. SAAB is you.

      Who the hell punts on third down?

  • avatar
    28-Cars-Later

    The fact is there are just too many “value” car brands in the US market and with exception to things like Miata, FR-S etc they all sell very similar product.

    Mazda has 1.8% of US market share YTD, and 1.9% last year according to WSJ, while another niche brand Subaru saw sales climb to 2.7% YTD. Hyundai 4.6%/4.9% and Kia 3.5%/3.9%, so combined 8.1% of all sales in 2013 YTD, or over four times Mazda’s sales. I see a brand culling on the horizon… either that or brands such as Mazda or Mitsubishi focus on more exotic product and drop the fight for bread and butter cars they clearly cannot win.

    http://wap.wsj.com/mdc/public/page/2_3022-autosales.html

  • avatar
    imag

    Thank the gods! Mazda has great products and one of the worst dealer networks known to man. Every dealership I have been to in the Bay Area is a sleezy, shabby, dark hole – with dreadful salespeople. And this should be one of their best markets, as people like small, fuel efficient, hip cars.

    Mazda – start cleaning house with Mazda of Marin. That place has been like a bad used car dealership for decades. I know two people who didn’t buy a Mazda because of that dealership. And Mazda Oakland could use some lights and some training for the salespeople. Just look at the Audi dealership in the same fricking building to see how to make your cars look good.

    • 0 avatar
      Dweller on the Threshold

      The maker should avenge the consumer by closing the sales outlets?

    • 0 avatar
      APaGttH

      Ditto in Puget Sound (see post below)

    • 0 avatar
      George Herbert

      If you know what you want, Mazda Oakland works just fine. They sell you things, their maintenance is top notch, etc. As an educated performance driver, who does most of his research online in depth before I decide to visit a dealer, the lights don’t bother me.

      I won’t name names, but maintenance and sales experience at another SF Bay Mazda dealership was suboptimal.

      • 0 avatar
        imag

        That’s the problem though. Enthusiasts know what they want, so for us, a counter with a car selection would be fine. But most people aren’t like that, and presentation matters.

        Mazda Marin is dreadful no matter who you are. It’s like they actively try to make a bad sales experience. Considering that the area should be an excellent location for Mazda’s new vehicles, it’s a huge shame.

  • avatar
    olddavid

    Say I’m Joe Dealership, with a $2 million dollar investment. I’m a dual with a Ford store. The Ford store can sell full-line products, to every customer, with a reasonable expectation of some return on investment. He has a sensible expectation he can, on occasion, exceed his planning volume with the right combo of incentives, advertising, and inventory. Now, from the Mazda side – what? It has always been a niche brand, dependent on fashion and trends, without any thematic consistence, even when part of the Blue Oval network. 637? Mazda should get down on their knees and thank the gods for the forbearance of those under-appreciated front-line workers. Re-trenchment? To what – 638? 537? Talk about putting the cart before the horse. Who’s idea is this? You’ve just had a change of management and one of your ideas is to alienate your partners in your highest gross market? Morons. They’ve forgotten the rising tide theory.

  • avatar
    readallover

    Most Mazda dealerships have acres of Mazda3`s, a couple of rows of CX-5`s, but only a handful of Mazda6`s.

    • 0 avatar
      CoreyDL

      They need more product! The CX-5 isn’t out there like the Escape is, the 6 is overpriced if you want it well-optioned, the CX-9 is old, the 3 at least seems old, the 5 is OLD OLD, and the Miata is just fine (getting old)- but will always be niche.

      I won’t comment on the 2 except to say it looks rubbish.

  • avatar
    Japanese Buick

    I bought my ’12 Miata at a combo Mazda/Lincoln dealer (if I’m the owner….eek!). While they have a separate Mazda building, it basically sits empty with a few cars in the showroom and all the business, for both Mazda and Lincoln cars, is done in the Lincoln building.

    That said I had a great experience from them, they worked with me to get the car i wanted from a dealer in another state (what is it with PRHT Miatas mostly being automatics???) at a reasonable price and the F&I experience was a breeze (but I was paying cash, so that might have something to do with).

    Point being, their physical plant shorted the Mazda side but it is still a good dealership. On paper it’s probably not a nice dealership because of the physical plant but there is more to it than that. It’s not always easy for executives in Japan to understand the on the ground work of actually moving the metal and keeping customers happy, so they should be careful about any culls.

  • avatar
    APaGttH

    In 2005 one of the main reasons I did not buy a Mazda6 5-door was the sleazy dealers in Puget Sound. They are all balls of slime here and hurt the brand.

  • avatar

    I started with a 2006 Mazda3 hatch, now I’m on my second 3, a 2011 hatch on a lease that is ending very soon.
    My dealer is 10 min away from me, very nice people, problem is that they sell other brands too, Ford, Lincoln and Subaru, probably, for them, selling another Mazda is not a big priority, Mazda itself is not doing much as to keep me as a customer, meaning, to get a 2.5 liter new 2014 Mazda 3 I will have to pay 25K, that is insane! My 2011 hatch was 20k when new.
    When the new 2014 Mazda 3 came out in November, my dealer did not have them yet so I went for a test drive in NJ at Wayne Mazda, they claim to be Mazda’s largest dealer in the world! turn out they are also competing on becoming the largest bunch of greedy bastards.
    They offered me a lease on a 2014 Mazda 3 GT for $540 a month, they held my car key and gave it back to me only after I started raising my voice so all other customers could hear me.
    What a shame!
    If Mazda want to sell more cars, they need to get rid of this dealer first.

    I just received a letter from Mazda North America offering me $500 to lease a new 3, great!

  • avatar
    chicagoland

    Near me is a dualed Hyundai/Mazda store, was combined during the recession. Wilkins in Elmhurst IL, near Chicago. There is a closed Lincoln-Mercury store sitting empty since ’09, and I want to see at least the Hyundai brand move to the empty space that’s blighting my area.

  • avatar
    Tifighter

    I went through this over the summer and commented about it on Alex’s 6 review. Two time Mazda owner, then current NC Miata owner, living in Oakland. Sure Oakland Mazda doesn’t have the greatest showroom on the Mazda side, but the staff was friendly and low pressure. Service folks were good. No complaints.

    Move near the end of summer back to Seattle area. Need a commuter, new 14 Mazda6 is at the top of my list. I check inventory on Mazda’s site. Go to see them at local dealers. First, most the dealers were one step up from a portable on an cracked piece of asphalt. I’ve seen better presentations from taco trucks. But okay, still interested in car. Next, I couldn’t find the cars Mazda’s own site listed in dealer inventory on the lot. Had to search the showrooms to find any sales people. When one would finally put down their phone they were texting with, they would tell me:
    -Nope, none in stock.
    -Don’t know why the web says its in stock.
    -Don’t know when more are coming.
    -The 6 has a $3k ADM, btw.
    -Sure you don’t want a CX5? Still would have ADM, but its in stock.

    This happened to me at 2 dealers. I’d leave my card asking to be called when more units showed up. I made it clear I was serious. Never got a call back from any of the them. Finally found one an hour away to test drive at a third dealer. After waiting around that showroom for 45 minutes, that is. Anyhow, I made an offer after all of it, but the dealer told me it was “pre-sold”. Funny enough, car was still listed on dealer’s site 2 months later.

    I bought an Accord…

  • avatar
    dtremit

    Pity they won’t have a replacement for the CX-9 until 2016 — it’s getting a bit long in the tooth already.

    I wish I had better things to report on the dealer front, but I went through two bad ones before finding one that wouldn’t hassle me about basic warranty service. The dealer I bought my 6 from had installed an optional shock sensor for the alarm; the sensitivity was so high that passing trucks and buses would trigger the alarm when I parked on the street. And yet the dealer tried to weasel out of providing warranty service for a fix that ended up being a quarter turn of an adjustment screw.

  • avatar
    3Deuce27

    Cutting dealers won’t help unless it throws more sales to another ‘nearby’ dealer which helps it survive and helps it increase its advertizing funds.

    I don’t need a dealership and its associated costs. I don’t need to be sold, and usually/always know more about the vehicle of interest then the dealer/salesperson. Would just prefer to buy online and pick up a vehicle at an OEM distribution/service center. Something Tesla is trying to do.

    Bought three new Miata’s and a new MPV from Royal Moore Mazda in Hillsboro, Oregon. I have nothing but kind words for them and their Mazda inventory. Their discounted, end of model year, Miata/Mazda sales, make dreams come true, if your not a stickler for color or options.

    Check them and their sales, out…> http://mazda.royalmoore.com/


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