Mazda’s plans for production at its AutoAlliance International joint venture with Ford in the US became slightly clearer this week when the Japanese carmaker announced it would end production of the Mazda6 there “at the end of its current cycle plan” and move production of its next-generation sedan back to Japan. The company would not confirm a date.
Mazda and Ford have operated the AAI plant in Flat Rock, Michigan as a 50-50 partnership since 1992. As well as the Mazda6 sedan the plant also produces the Ford Mustang, which has seen higher output at the facility, with deliveries hitting nearly 74,000 over the last fiscal year against 45,000 Mazda6 units produced in the same period. The plant has a total output capacity of 240,000.
“Our intention is to transfer production of our next CD-car [mid-size vehicle] for North America from AAI and consolidate it at Hofu in order to improve production and investment efficiencies and optimize our business,” said president and CEO Takashi Yamanouchi. He cited changing demand in North America and exchange rate exposure as factors influencing the decision. The yen’s 15% gain against the US dollar over the past year has reduced Mazda’s profit from overseas sales.
The company is still distancing itself from earlier press speculation that it was pulling out of the AAI venture altogether. Last Friday the Nikkei financial daily said that said Mazda was considering selling its stake to Ford as it sought to restructure global production and that Mazda cars sold in the US would be shipped from Japan and Mexico, starting around 2013.
Mazda then issued a brief response stating the reports were “not based on information released by Mazda”. Reports elsewhere in May also suggested that Mazda was ending production of the mid-size sedan at Flat Rock and this too had been refuted by the carmaker. However, the latest announcement verifies that the next-generation will indeed be exported from Japan.
Mazda exported more than 284,000 vehicles to North America from Japan in the last fiscal year, 18% more than the year before.
The company still maintains, though, that it is studying various possibilities for the future of AAI with Ford. “We are committed to working with Ford…to identify potential future opportunities for the plant,” said Yamanouchi. “We have collaborated on projects where there are mutual benefits and both companies remain committed to continuing this strategic partnership.”
These include Changan Ford Mazda Automobile in China (which also makes the Mazda6) and AutoAlliance (Thailand).
As for shipments of a vehicle from Mexico, Mazda is reported to be setting up a new manufacturing facility with Japanese trading giant Sumitomo Corporation there. Sumitomo bought a 3% stake in Mazda last November with a view to feasible joint businesses with the carmaker in emerging countries.
Mazda said it had nothing to announce on this subject at the moment but told Automotive Logistics that it made “good business sense to consider entering emerging markets to expand [its] business”.
In related news Mazda’s US division has recently announced that its vehicle logistics, fleet, remarketing, incentives and sales planning have been reorganized under a new position-vice president/chief of staff U.S. Operations. Toru Nakajima, currently general manager of global product marketing for the parent company, will take up the role reporting to Robert Davis, newly appointed senior vice president of US Operations.
