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Mazda's first-quarter profit slumps on weak sales in U.S. and China

TOKYO — Mazda reported a 79% drop in quarterly operating profit, falling significantly short of estimates, as it continues to struggle with declining U.S. and Chinese sales, while a strengthening yen also cut into its bottom line. Operating profit at JapanÂ’s No.5 automaker was 7.0 billion yen ($64 million) in the first quarter ended June, versus around 33 billion yen a year ago and less than half of an average forecast for 18.5 billion yen from analysts polled by Refinitiv. Mazda, however, reiterated its forecast for a 33% rise in operating profit to 110 billion yen in the year ending March. ThursdayÂ’s profit announcement marks MazdaÂ’s poorest first-quarter operating performance since the June 2012 quarter. The automaker has been struggling with falling demand for its cars over the past year or so, while it is also recovering from flood-related damage to its factories in Japan that led to a quarterly loss in the July quarter of 2018. The Nikkei business daily on Wednesday had reported that operating profit at the company would fall around 70% for the quarter due to lower sales in the United States. Mazda posted global sales of 353,000 units for the quarter, down 12% from a year ago. Its sales in the United States, its biggest market, fell 15% to 68,000 units, while in China, Mazda sold 54,000 vehicles, down 21% on the year. A trade war between the top two economies and slowing growth in China, the worldÂ’s biggest auto market, have prompted a broad-based sales downturn in the global auto sector. Automakers are grappling with easing demand for cars just as they must invest heavily in new technologies including electric cars, autonomous driving technologies and ride-sharing services to survive a major industry shift away from car ownership. Many of MazdaÂ’s rivals at home and abroad have been reporting disappointing quarterly results, with Nissan and Ford also announcing job cuts and possible plant closures earlier this month. The United States is a key source of revenue for Mazda, but it imports all its vehicles sold there, exposing it to a threatened hike in U.S. tariffs on imported cars from Japan. To limit its vulnerability to possible tariffs and currency fluctuations, Mazda is investing in a new plant in the U.S. state of Alabama, a joint project with Toyota.

2019 Mazda3 First Drive Review | Defining the term 'fun to drive'

Fun to drive. The phrase gets blasted from seemingly every car commercial, magazine ad, and influencer account – overused that it has lost all meaning. So when Mazda, a small firm that actually does make cars that are fun to drive, talks about their most compelling trait it gets lost in the cacophony of ad spends. However, we're here to tell you that yes, while it's difficult to quantify, some cars are objectively more fun to drive than others, and the all-new 2019 Mazda3 is — and this is a very technical term — a freakin' blast. At Mazda's behest, we took a 2019 sedan up Angeles Crest Highway just outside of L.A. With plenty of yellow signs, tight sequences of banked curves and elevation changes, it's the platonic ideal of those serpentine mountain roads you see in car commercials. The instant the Mazda3 reaches the windy roads, it glides in like an otter diving into the sea. Lively and graceful, it dances along a ribbon of asphalt more naturally than any compact sedan we've driven since the advent of drive-by-wire. The steering is not only direct and true, but possesses an extraordinary ability to maintain trajectory. From the moment you turn in, you never need to make adjustments to the steering wheel until the front tires are straight again. The car goes exactly where you intend, always. That's not hyperbole, but an amazing feat of engineering. In nearly every other vehicle, even those that purport to be sports cars, unless you're incredibly familiar with the machine and know the road like the back of your hand, minor mid-corner corrections are an inevitability. With the 3, you get it right on the first try. Now imagine you're on strip of canyon pavement with lots of short switchbacks in varying radii coming up fast, one right after another. The 3 links them all together with pure ease, and soon you're developing a rhythm through the curves. While other cars charge, the Mazda flows. The car's poise is particularly evident as momentum shifts from one direction to another, what Mazda chassis engineer Dave Coleman termed "transience." In most cars passengers are tossed around the cabin like mannequins, but the 3 cuts out the turbulence, its body engineered to move in a smooth undulation. At the midpoint of the transition, there's even a moment of weightlessness before the car tucks into the next turn and the seat seems to scoop you up and carry you onward.

Asian automakers still reluctant to use more aluminum

There's a logical progression of technology in the auto industry. We've seen it with things like carbon-ceramic brakes, which use to be the sole domain of six-figure sports cars, where they often cost as much as an entry level Toyota Corolla. Now, you can get them on a BMW M3 (they're still pricey, at $8,150). Who knows, maybe in the next four a five years, they'll be available on something like a muscle car or hot hatchback. Aluminum has had a similar progression, although it's further along, moving from the realm of Audi and Jaguar luxury sedans to Ford's most important product, the F-150. With the stuff set to arrive in such a big way on the market, we should logically expect an all-aluminum Toyota Camry or Honda Accord soon, right? Um, wrong. Reuters has a great report on what's keeping Asian manufacturers away from aluminum, and it demonstrates yet another stark philosophical difference between automakers in the east and those in the west. Of course, there's a pricing argument at play. But it's more than just the cost of aluminum sheet (shown above) versus steel. Manufacturing an aluminum car requires extensive retooling of existing factories, not to mention new relationships with suppliers and other logistical and financial nightmares. Factor that in with what Reuters calls Asian automaker's preference towards "evolutionary upgrades," and the case for an all-aluminum Accord is a difficult one. Instead, manufacturers in the east are focusing on developing even stronger steel as a means of trimming fat, although analysts question how long that practice can continue. Jeff Wang, the automotive sales director for aluminum supplier Novelis, predicts that we'll see a bump in aluminum usage from Japanese and Korean brands in the next two to three years, and that it will be driven by an influx of aluminum-based vehicles from western automakers into China. Only time will tell if he's proven right. News Source: ReutersImage Credit: Sean Gallup / Getty Images Plants/Manufacturing Honda Hyundai Mazda Nissan Toyota Technology aluminum