Mazda Motor at the weekend approached three leading local banks and other lenders in Japan to secure JPY300bn (US$2.8bn) in fresh loans, as the company struggles under the impact of the COVID-19 coronavirus. 

Like all global automakers, Mazda has been affected by the sharp fall in global vehicle demand caused by the coronavirus.

The company so far has cut production by 130,000 units due to the pandemic, or around 10% of its normal annual sales. Extensive production cuts are also planned for May.

Sales in the US were down 44% to 10,940 units in April and by over 13% at 78,610 units year to date.

First-quarter sales in Europe declined by over 45% to 27,509 units while volume in Japan was almost 12% lower at 63,543 units in the three month period.

The three main banks approached by Mazda include Mitsubishi UFJ Financial, Sumitomo Mitsui Financial and Mizuho Financial while other lenders include the Development Bank of Japan and Sumitomo Mitsui Trust Holdings. 

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All are expected to agree to the loans with some said to have already provided the funds to the carmaker giving Mazda substantial liquidity to see it through the pandemic.

According to its financial statements, Mazda had around JPY500bn in cash and deposits at the end of last year.