Mazda China confronted with three major problems

MENAFN (Nanjing) - After the recent independence of Changan Mazda, Mazda China has still been confronted with three major problems, a two-digit decline in China sales, a sluggish team, and a not clear direction for the not wide product portfolio, said industry analysts.

Before the independence, Japan-based Mazda Motor Corp. has had a tough way in China. In the country, it has set up a sales joint venture with China FAW Group Corp., one of the biggest Chinese automakers, but they have not had any formal works for joint-venture production.

Moreover, Mazda had a joint venture Changan Ford Mazda Automobile Co., Ltd. in China in partnership with China's Changan Automobile Co., Ltd. (szse:000625) and US Ford Motor Company F.

However, Ford Motor had the greatest impact, and Mazda did not have much free scope, which has strongly influenced the development of the Mazda brand, according to some reports.

In order to get out of these troubles, in 2010, the president of Mazda China disclosed that Mazda submitted an application (for the independence of Changan Mazda), which was being reviewed.

However, China's National Development and Reform Commission (NDRC) did not approve the application. The reason was that the application did not involve the launch of independent brands and the establishment of the R&D center. As a result, Mazda and Changan Automobile had to change their scheme.

In 2012 August, foreign media reported that Changan Ford Mazda got a spin-off approval from Chinese government, citing Ford Motor CEO Alan Mulally.

Foreign reported that two new companies would be named Changan Ford and Changan Mazda temporarily, with the Chongqing base belonging to Ford Motor and Changan Automobile, and the Nanjing base owned by Mazda and Changan Automobile.

At the end of 2012, Changan Automobile, Ford Motor, and Mazda released a joint statement, saying that approval has been gotten from related government departments to spin off Changan Ford Mazda into two joint ventures.

After the restructuring, the venture between Changan Automobile and Ford Motor is reported to be a 50-50 one between the Chinese and US sides, the same as in 2001 when the venture came into being initially.

Changan Mazda, the venture between Changan Automobile and Mazda, is believed to be a new company in the Chinese car-making industry as well as the first complete car venture for Mazda in China. Additionally, FAW Mazda Motor Sales Co., Ltd.,, the joint venture between Mazda and FAW Group founded in 2005, is only engaged in selling cars.

Changan Mazda, headquartered in the eastern Chinese city of Nanjing, will firstly turn out the CX-5, which is reported to rival Honda's CR-V, Toyota's RAV4, and Volkswagen's Tiguan.