[Company analysis] Mazda Motor Corporation (マツダ)

「Mazda Motor Corporation (マツダ)」is located in Hiroshima Prefecture and basically manufactures automobile and its related parts. According to 2018 standards, their global sales were 1.55 million units, and it is 14th largest sales volume in the world. In Japan, they are the 5th largest automobile manufacturer after「Toyota Motor Corporation(トヨタ自動車)」,「Honda Motor Co., Ltd.(本田技研工業)」,「Nissan Motor Co., Ltd.(日産自動車)」and「Suzuki Motor Corporation(スズキ)」. The number of consolidated employees is approximately 49,755.

 

1. Company Profile

2. Summary and Features

3. Major Business

4. Financial Information

 

 

 

1. Company Profile

 

※Unit is JPY million, as of 2019

Company name	Mazda Motor Corporation
Company name (Japanese)	マツダ
Date of establishment	Friday, January 30, 1920
Headquarters location	〒730-8670 広島県安芸郡府中町新地3番1号
Capital	284,000
Consolidated sales	3,564,696
Consolidated operating profit	83,013
Consolidated total assets	2,871,018
Consolidated capital	1,248,915
Capital adequacy ratio	43.5%
Consolidated number of employees	49,755

 

 

 

2. Summary and Features

 
The predecessor of「Mazda Motors」is「Toyo Cork Kogyo(東洋コルク工業)」, which was producing cork, and  motorcycles until the Great Kanto Earthquake of 1923. They started producing three-wheeled trucks in 1931, and since the World War II, they became one of Japan's top-class truck manufacturers. From the 1960s, they expanded their business to the personal automobile market, and in 1967 they launched the first rotary engine car based on a technical tie-up with Germany's「NSU」and「Wankel」.

Since 1969, they initiated a technical tie-up with「Ford」in the field of supplying automatic transmissions and parts kits. However, after the 1973 oil shock, the sales of「Mazda Motors」was fallen sharply. At that time, most of Mazda's vehicle was equipped with a Wankel's rotary engine which has poor fuel efficiency. This caused a sharp drop on its demand. Fortunately,「Ford」decided to purchase 25% of the total stock of「Mazda」, so they escaped from finiancial crisis. And due to the success of "RX-7" which was released in 1978, they finally recover the sales too.

In 1984, they changed the name to the current one and strengthen the relationship with「Ford」, in order to capture the Japanese automobile market. However, because of the collapse of bubble economy, both domestic and overseas sales of「Mazda」became sluggish. And when in 1996, cumulative deficit reached 75 billion yen. So 「Mazda」was purchased by「Ford」.

However, because of the Subprime mortgage crisis,「Ford」was ought to sold the shares of「Mazda」to secure cash, so it became completely independent from「Ford」. Instead, in August 2017, they entered into a business and capital tie-up with「Toyota Motor Corporation」. It is sometime said that behind of this action, there was Mazda's technological strength.

「Mazda」has the world's highest level of internal combustion engine technology. They even succeeded in commercializing compression ignition of gasoline engine first time in the world and this improved fuel efficiency by about 30%. However, they are comparatively inferior in the next-generation technologies such as EV and autonomous driving. This is why they decided to tie-up with「Toyota Motor」.

In terms of overseas sales ratio,「Mazda」is said to be the top class among Japanese automobile manufacturers, and is particularly strong in the European market. The problem is that Mazda's operating profit as a company is not so high, because it features a model with a good cost performance, which is cheaper than the specifications. Even from the consumer's perspective, there is also a phenomenon so called "Mazda Hell". 

In fact, the「Mazda」offers a large discount when customer buy new car as a replacement of old one. So the second-hand selling price is relatively lower than other brand vehicle. In other words, if you try to resell Mazda's used car and purchase new car from other companies, you should bear heavy price. So, once you purchased from「Mazda」, you cannot escape from them. This is the "Mazda Hell". However, interior and running performance of Mazda's car became improved, and the reselling price is now considerably risen. Some says, "Mazda Hell" is just a mere old story.

 

 

3. Major Business

 

■ Automobile business
They manufacture and sell passenger cars and trucks. The management strategy of "Mazda" is "selection and concentration", and no particular business diversification is implemented.

 

 

 

4. Financial information

 

※Unit is JPY million

		2016	2017	2018
Consolidated sales		3,214,363	3,474,024	3,564,696
Consolidated operating profit		125,687	146,421	83,013
Consolidated total assets		2,524,552	2,728,087	2,871,018
Consolidated net assets		1,064,038	1,219,470	1,248,915
Breakdown of sales	Japan	1,018,151	1,060,078	1,106,715
	America	1,073,094	1,114,292	1,135,034
	Europe	589,646	695,200	699,045
	Others	533,472	604,454	623,902