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And the Mazda goes Hmmmm

by Donal 6/4/2011 - 12:21 pm   |



This morning, a local news blurb claimed that Mazda was leaving the US. What does that mean? According to Mazda May Quit Michigan Venture in the Wall Street Journal, Mazda primarily wants to leave their Auto Alliance International joint venture with Ford because it simply isn't profitable:

North America, Mazda's biggest market, is the only region where it is losing money. Hurt by the strong yen, it chalked up its second consecutive operating loss there last year. Mazda has struggled to keep up as rivals including Volkswagen and Hyundai Motor Co. have spent more on marketing and have had new products that have crowded out Mazda models.

Detroit Free Press puts some numbers on the Mazda losses:

Mazda's latest financial results revealed tough times for the Hiroshima-based company. Its net losses swelled to 60 billion yen ($742 million) in the fiscal year ended March 31, from 6.5 billion yen the previous year. The company blamed a persistently strong yen and lackluster sales in Japan, as well as the March 11 earthquake and tsunami that disrupted auto production.

After walking away from the joint plant in Flat Rock, MI, Mazda will need a new plant, ... and back in the WSJ, even though the US is their big market, no one is talking about a new plant here: 

A dissolution of the alliance could force Mazda to build a new plant in North America, possibly in Mexico, in order to overcome the strength of the yen to the dollar. ... A new plant in Mexico also could allow it to build smaller cars for the U.S. market and avoid unfavorable exchange rates that make Japan-made cars expensive to export.

Hmmm. Hecho in Mexico. Does it really make sense to build and operate an assembly plant in a state that is losing authority to narcotics traffickers?

Too bad Ford didn't learn anything from their joint venture.

I'm waiting to see the US start producing autos with clearly defining attributes of Asian and European design and engineering. After all, that's why so many of us moved to their product lines...the US product lines always came up short and wanting. Buy American doesn't save gas, costs more with fewer amenities and has a short life cycle.

By the way, I have a 1995 Honda Del Sol, the economy version [non VTEC] just tipping over 325,000 original miles, still gets 38 mph local and 42 mph autobahn [cruising at 120kph] and I'm just starting to spend money on repairing of the more serious parts...engine overhaul, head and valves and so forth.

Too bad the US automakers can't compete on that level. Sad fact is...we can do better. read this article ...

http://www.huffingtonpost.com/2011/06/01/us-can-become-major-exporter-ag...

We have the capability, but are lulled by the false chase for profits over product, not realizing the product is the profit.

 

by Beetlejuice 6/4/2011 - 2:26 pm

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