After The Miata, Mazda Isn't Just Idling

Mazda Motor Corp. long has been the low-price Japanese alternative--and a distant fourth in the U. S. to Toyota, Honda, and Nissan. But two years ago, it decided to change that. First came a new advertising slogan, "It just feels right," promoting the idea that Mazda's attention to detail makes driving its cars an intensely personal and fun experience. Lending some substance to that claim was the launch of the phenomenally successful Miata roadster.

Now, for the serious stuff. Following the Miata's success with budget-minded sports car lovers, Mazda is gearing up to compete against the big guys with mainstream products, too. Over the next nine months, starting in September with a new high-end 929 sedan, it will replace virtually its entire car line. That's not all: On Aug. 20, Mazda took the wraps off plans for the Amati, a new luxury car line aimed directly at Toyota's Lexus and Nissan's Infiniti brands.

HOLDING STEADY. Showrooms for the new cars--named after a 17th century family of renowned Italian violin makers--won't open until spring, 1994. But Mazda already has established a momentum that should serve it well until those higher-margin products kick in. Mazda is the only major carmaker this year to hold sales level with last year in a car and light-truck market that's down 13.4%. Even its larger Japanese rivals have seen sales slip anywhere from 5% to 10%.

That accomplishment gives Mazda nearly 3% of the U. S. market, up from 2.3% just three years ago (chart). "Mazda is outperforming everyone else this year, and it's all marketing-driven," says Christopher W. Cedergren, senior vice-president for market researcher AutoPacific Group in Santa Ana, Calif. Despite offering many models that have gone several years without a redesign, the carmaker has used dealer incentives and occasional customer rebates to keep its products in demand, he says.

Rolling out first in Mazda's line of new wheels will be its $25,000 929 sedan, positioned further upscale to compete directly with the Acura Legend. Cedergren, who has driven a prototype, claims the sedan has "a little more finesse, a little more detail" than the Legend. Mazda also will launch a new, entry-level sporty coupe, the MX-3, selling in the midteens. Its advantage? A new, small V-6 engine that should give it a slight edge in performance and a big one in marketing over its competitors' four-cylinder jobs. Next spring will bring a new 626 family sedan, MX-6 coupe, and RX-7 sports car.

Mazda's plan, analysts say, is to aim its core products at a slightly more sophisticated and discriminating buyer than its competition--probably at slightly lower prices. Whereas the Nissan 240SX and Toyota Celica are especially targeted at women in their mid- to upper 20s, the upcoming MX-6 is designed more as a luxury, two-door coupe for a slightly older, more affluent male audience that prefers a racier look.

It's a strategy that keeps Mazda a tad off the center of increasingly crowded market segments. "We don't want to be No. 2 on everybody's shopping list," says Clark J. Vitulli, senior vice-president of the company's U. S. marketing arm in Irvine, Calif. "We want to appeal to a smaller target audience and be No. 1 on some lists." The new MX-3 is an example: "If you want a V-6 in that class, there's only one place to go."

Given that Lexus and Infiniti will be on their second generation of feature-laden products by the time Amati arrives, it will be hard to win luxury buyers on features alone. So it probably will compete on price. Mazda executives say the cars will be priced at the same level as Lexus and Infiniti, whose flagship models now sell for around $40,000. But analysts expect Mazda to tag its models a notch under its competitors, the price for coming late to the game.

FROM SCRATCH. With a family of products that already range from a $7,000 subcompact to big sedans close to $30,000, Mazda has little choice. If it wants to expand, it has to construct a luxury franchise from scratch. "There's no other way to establish a serious and credible luxury marque and realize the kind of price premium that only a luxury car brand can bring," says Leonard Sherman, vice-president for the auto practice at Booz, Allen & Hamilton Inc. in New York.

Mazda hopes to make things easy on its new Amati dealers. To reduce the capital dealers will have to shell out, Mazda has stripped away some of the requirements that made Lexus and Infiniti dealerships so expensive. Showrooms must be exclusive to Amati, for example, but service facilities may be shared with another brand. The new division hopes to have at least 50 dealers lined up by the time it opens. Meanwhile, Mazda will want to think about names for the new models. Maybe they'll even name one after the Amati family's most famous student--Antonio Stradivari.

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