Mazda has reported a 79% plunge in operating profit for its first fiscal quarter – not as bad as Nissan’s 99% – but still cause for concern.
It booked JPY6,952m on sales off 2.7% to JPY848,915m. Net income fell 75% to JPY5,240m with the net income per share plunging to JPY8.32 from JPY32.66 a year ago.
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Global unit sales volume was down 12% to 353,000 due to decreases in the key markets of Japan, US, and China. Europe was flat at 67,000.
“The business environment is worsening as the yen appreciates and competition intensifies. Mazda will take action to recover sales momentum in key markets [and will] continue to improve quality of sales leveraging the new 3 and prepare for the CX-30 launch, the second new-generation model,” Mazda said in slides prepared for a press presentation in Japan.
Japan sales were 39,000 units, down 20% year on year. Market share was 3.2%, and registered vehicle market share was 3.9%, down 1.3 points year on year. Mazda had in May projected a year-on-year sales decline due to the 3 redesign model switchover and reduced “new-car effect” for CX-8.
“Although orders and sales of new generation 3 exceeded the plan, sales of existing models were lower than expected and overall sales failed to meet the May forecast,” it said.
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By GlobalDataNorth America sales were 100,000 units, down 14% year on year with the US down 15% to 68,000 units, Canada down 17% to 19,000 and Mexico up 1% to 13,000.
Mazda said in May it expected to continue curbing incentives, offset reduced fleet sales mainly with CX-5 and new 3 and maintain sales on par with the prior year but sales of both fell short of the May forecast though reduced incentives on CX-5 improved per-unit profit and transaction prices for the new 3 topped the class thanks to substantially reduced incentives and the fact that sales of models in the higher price ranges exceeded the plan.
Europe sales were 67,000 units, on par with the prior year or up 2% to 60,000 taking Russia out where the 7,000 units sold were off 16%. German sales tose 6% to 17,000 and the UK was up 8% to 8,000 units.
Mazda said 3 sales were strong, incentives were down and high grade models accounted for a higher ratio of sales.
China sales fell 21% to 54,000 after the May forecast of a year-on-year sales decline in light of contracting demand, continuing fierce competition, and the fact that mainstay models were pre-update.
Sales fell short of the plan as sales of CX-4 and 3 (before switching to the redesigned model) declined more than expected.
Other market sales were 93,000 units, down 10% year on year. Australia volume fell 9% to 27,000 units with market share on par with the prior year despite declining demand and intensifying competition. Orders for the new 3 were strong with a higher ratio of high priced models than planned.
ASEAN sales of 29,000 units were down 11% year on year. Thailand was down 10% to 15,000 units and Vietnam off 3% to 7,000.
Despite the Q1 gloom, Mazda is sticking to its May full-year forecast – JPY3,700bn of revenue (+4%), JPY110bn operating profit (+34%) and net profit of JPY80bn (+27%). Unit sales of 1,618,000, up 4%, are forecast.
