Mazda forecasts better year ahead

MAZDA Australia is expecting its sales to stabilise next year through a combination of crucial new models entering the market, major customer service initiatives and a slow but gradual improvement in consumer confidence and therefore spending in the economy.

 

In an interview with GoAuto last week after presenting two of these key models – the all-new CX-30 small/medium SUV due in February and the heavily upgraded Mazda2 light car that reaches showrooms this month – Mazda Australia managing director Vinesh Bhindi said the company was on track to achieve its targeted 100,000 sales for the 2019 calendar year and that it should hold on to this annual volume in 2020.

 

The six-figure result would still represent a 10 per cent downturn for Mazda on last year’s 111,280-unit performance, but will see it retain its number-two status in the market (behind Toyota, ahead of Hyundai) and maintain an overall market share of about 9.8 per cent.

 

“The market is down eight per cent; if that eight per cent decline continues for November-December, the market is going to be 1.06 (million units). However, in our mind we think 100,000 sales are still there, that’s where we see it,” Mr Bhindi said.

 

Mazda’s monthly new-vehicle registrations have fluctuated wildly in recent months – down 22.1 per cent in October compared to the corresponding month a year earlier, up 15.5 per cent in September, down 32.1 per cent in August, for example – but Mr Bhindi said there was no cause for concern and that the figures simply reflected the ebb and flow of deliveries to its customer base, made up primarily of private individuals and small-business buyers.

 

“From our point of view, we are very focused on the private buyer, or the user-chooser type, and when you take those segments in isolation, it’s actually declined more than eight per cent – it’s more towards nine per cent because some of the other buyer types like rental and government and large fleet in fact has improved. But we don’t engage in that as aggressively as many do, so our business and our results are purely what the private buyers are doing in the market,” he said.

 

“Our numbers are very clean. They are reported when the customer takes delivery. We are happy to deliver to customers when they want it. Some products are always on back order and it takes a little while to come, so I don’t think there’s any trend in there, it’s more to do with when the car’s arrived and when the customer wants it.”

 

Asked whether Mazda could hold on next year to second position in the highly competitive marketplace, and its 9-10 per cent share, Mr Bhindi said: “One, it will depend on the market. Second, depend on what others are doing. But it’s not something we wake up each morning and worry about – it’s only a biproduct of what we do.

 

“Our business focus again next year, and the years after, will be: What’s the opportunity within the private buyer market and the user-chooser/small business-type buyers, what products have we got, and what’s the opportunity and potential?”

 

For CX-30, Mr Bhindi forecast 700-800 sales per month – up to 9600 sales for a full year – with little cannibalisation between the slightly smaller CX-3, slightly larger CX-5, and other models that are holding a high segment share but are leaking sales.

 

These include the Mazda3, the top-selling small car to private buyers which picks up the SkyActiv-X mild hybrid powertrain in the first half of next year. This is Mazda’s first foray into electrification, with CX-30 adding the powertrain in the back half of the year.

 

“With the new CX-30 coming in February, we are looking forward to an improved business environment, along with a lift in consumer confidence and therefore spending. For Mazda, this is critical given our focus on private buyers,” Mr Bhindi said.

 

The company expects Mazda2’s declining sales to now stabilise with the updated and albeit more expensive new series. It will not discuss other new product, but is planning for the introduction of a fully redesigned BT-50 ute based on the incoming new-generation Isuzu D-Max.

 

“We are not in a position to confirm anything on BT-50 at this stage, but we have got big plans and at the right time we will share that with you,” Mr Bhindi said.

 

The full-electric MX-30 SUV is also a chance to make it late next year, but a decision on its Australian introduction is still to be confirmed. There was also no firm word from Mazda executives last week about other anticipated arrivals, such as a much-speculated high-end sportscar, a luxury-sports flagship model and other vehicles in development with new inline six-cylinder petrol and diesel engines with a rear- and AWD driveline.

 

Away from product, Mr Bhindi did confirm that Mazda will look to draw in new buyers with a big launch of its own-branded finance package, a related guaranteed future value program (‘Mazda Assured’), continued modernisation of its dealerships and a still-secret new investment in other facilities to be announced early next year.

 

He said current litigation that sees Mazda contesting allegations made by the Australian Competition and Consumer Commission (ACCC) that the car-maker made false or misleading representations to customers should not harm the brand or its sales – “We reject very strongly the allegations and we’ll defend it” – and that general economic indicators were positive.

 

 “What I’m calling is that the market will be flat year-over-year, but that’s on the assumption that the issues of credit flow and consumer confidence will improve,” he said.

 

“I think enough noises and strategies are being deployed by the government and the Reserve Bank to provide the confidence. Credit flow eventually has to come into the marketplace because if there’s no money floating around, then it’s an issue. And that needs to happen.

 

“So we are expecting it will happen next year, and if it does, then year-over-year it will remain flat … and our volumes will be similar. Now, if that doesn’t happen, then we’ll need to go back and have a look – if credit and lending doesn’t flow into the economy, and if confidence continues to tumble – but I don’t think that will happen.”

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