By on May 14, 2020

2020 Mazda CX30 Soul Red - Image: Mazda

The fiscal year that wrapped up at the end of March was not a good one for Mazda, the company claims, with profit cut almost in half amid fallout from the coronavirus pandemic. On Thursday, Mazda revealed a full-year operating profit of just $408 million — its lowest showing in 8 years.

Smaller than its Japanese rivals and heavily dependent on the North American consumer, Mazda was hit hard by lockdown orders that dried up sales in the U.S. and Canada in March.

This, after a 2019 spent struggling to regain its footing in the market. The launch of the somewhat upscale current-generation Mazda 3 didn’t go off exactly as planned, though the company’s CX-5 crossover remains popular. Last year also brought the introduction of the CX-30 small crossover, a model that bridges the gap between the tiny, slow-selling CX-3 and the CX-5.

While the first two months of the calendar year did bring an improvement in U.S. sales, March wiped out those gains. Volume fell 41.8 percent that month, year over year, as dealerships closed and residents battened down the hatches. April wasn’t any better, with sales down 44.5 percent.

With operating profit down 47 percent (from last year’s $769 million), the automaker declined to release a forecast for the current fiscal year. All it would say is that the business environment is “expected to remain highly uncertain due to the novel coronavirus outbreak.”

Hampering Mazda’s return to full production in Japan is a backlog of undelivered vehicles clogging U.S. ports. Burning cash, the automaker has tapped three Japanese banks and other lenders for sizable loans, Reuters reports.

Globally, the automaker’s sales fell 9.1 percent in the year ended March, with North American volume down 5.8 percent. The U.S.’s share of that decline was 4.1 percent, though the overall cratering of the market in March meant that Mazda’s market share didn’t drop.

[Image: Mazda]

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8 Comments on “New Mazdas Loiter in Ports As Company Reports Profit Dive...”

  • avatar

    “Smaller than its Japanese rivals and heavily dependent on the North American consumer,”. Actually, no. Larger than Subaru and less than 25% of its worldwide sales are in the USDM.

  • avatar

    Actually yes – smaller than Toyota, Nissan, Honda, Suzuki. And North America is their largest market.

  • avatar
    SCE to AUX

    “…a backlog of undelivered vehicles clogging U.S. ports”

    If sales are declining, is that a problem?

    While taking a late-night stroll through the local Mazda dealer, I discovered one reason they’re not selling – price. Tiny CX-30s with MSRPs of $26-32k made me laugh out loud. Many CX-5’s listed at $35k+.

    Mazda will always be stuck at 1.8% market share unless they can offer more value. Having the most ergonomically correct interior isn’t worth a 20% premium to most consumers.

    • 0 avatar

      The automotive press loves Mazda. Even with all that positive publicity (which means a lot), those voting with their checkbooks walk away. Maybe, just maybe, the automotive press is out of touch.

    • 0 avatar
      Daniel J

      I’m ok with the price, considering that their SUVs, especially the CX-5, is holding its value close to the RAV-4 and CRV. The notion that mazda is too expensive is incorrect. CX-5 Grand Touring Reserve is running about 36K here and can be had for about 34.5K, yet I’ve test drove both a CRV that was listed at 36K and the dealer wouldn’t move on price, and it has a small little 1.5L turbo. We also test drove an Escape Titanium 2.0T that was listed at 40K that we could probably get for 35K since Ford has heavy discounts.

      Basically, Mazda doesn’t want to discount too much to raise the brand value. When I see 2 and 3 year old CX5s going for the same price as the CRV yet a similar Escape, Rogue, or Sportage is thousands less, I think they are doing their job. People keep buying Honda and Toyota because at trade in time they hold their value. Mazda is trying to do the same.

  • avatar

    Changing fortunes have hurt Mazda coupled with missteps. Americans are quite clear they don’t give a crap about near-luxury quasi-performance.

    A series of questionable designs, pricing issues on some models, the bad history of the 3.0L V6, and a reputation for automatic transmissions even less reliable than Nissan.

    This is a brand I want to love – badly. For me Mazda is like Acura a decade ago. A brand I desperately wanted to love, their products “close” but not close enough.

    They have a couple of good products to offer, but not enough to stem the bleeding. In a lot of ways, I’m surprised they haven’t looked for a merger or been absorbed.

    In hindsight, it seems Ford got a lot more from their partnership than the other way around.

    • 0 avatar

      Going mainstream “premium” (w/ the requisite price hike) has always been a risky move for the US market; see VW, which abandoned that and turned to developing vehicles specifically for the US market (copious amounts of interior space at a very competitive price-point).

  • avatar

    Another Lancia, maker of semi-premium sporty cars?

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