Chris Wright and Anthony Lewis in Paris

Mazda's sales success in the UK this year is being mirrored in Europe where the Japanese carmaker is aiming to return to the heady days of the late 1980s and early 1990s.

Then it sold around 250,000 cars a year in western Europe. Those were the days before the Japanese economy bubble burst.

The message from the Paris motor show was that the company is on its way back and looking to increase sales by 75 per cent to 240,000, said Mazda Corporation chief financial officer Robert Shanks.

In the UK Mazda has sold 15,613 vehicles to end of August, up 122 per cent from 7,022 in the same period last year.

The past 18 months have seen a massive turnaround for the Japanese company now owned by Ford.

By the end of the 1990s Mazda was showing huge financial losses and struggling with an unfocussed model line up and a confused brand image.

Its troubles dated back 10 years when the company embarked on a massive expansion plan which landed it with a lot of fixed costs and even bigger debts. When the economic bubble burst it struggled to cope.

Drastic surgery was needed when Ford took over. Since then costs have been cut through sharing vehicle platforms and components and by closing one of Mazda's Japanese factories to reduce capacity. The workforce has also been cut by 22 per cent.

New models are coming through with the Mazda6 launched this year and the Mazda2 small car and the stunning RX8 sports car to follow in early 2003.

The result is that Mazda has returned to profit and production is once more on the way up. It built 948,000 vehicles last year and plans one million in 2002 rising to 1.2 million by 2004.

Mr Shanks said: "We have done a lot of work and it has paid off, but there is still some way to go. The financial re-engineering has worked and we now have a more focused brand image. We are developing clearly defined vehicles and restructuring our distribution and dealer networks in Japan, Europe and North America."

"Our marketing strategy, led by the Zoom Zoom campaign, has also worked well and customers can now clearly identify Mazda as a lovely and spirited brand."

Mazda is also planning to do more work on its dealer network in Europe. Mr Shanks added: "We need more dealers in Spain, for example, while there is some fine tuning needed in Germany and the UK, our two biggest European markets."

Published : 27/09/02 Author : Melanie Carter

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