FAW Mazda will hand over Mazda 3 sales by 2008

Recently the agreement of Mazda 3 reproduction has been exposed that Chang'an Ford Mazda will fully recover the sales of Mazda 3 in 2008.

A few weeks ago, Chang'an Ford Mazda, Mazda China and FAW Mazda signed an agreement, that Chang'an will take over Mazda 3 sales through the FAW Mazda sales network .

But this sale model is just a temporary one. Currently Chang'an Ford Mazda is planning to build its own network of specialized sales for Mazda products.

Mazda set up FAW Mazda sales company in March 2005 in China, which was intended to uniform Mazda sales. And FAW Mazda would be taken as the sole sale company for Mazda, in charge of sales of the Mazda 6 and after "Mazda" production in China.

Informed sources revealed that the direct reason for the halt of the Mazda 3 is the share problem. To balance the benefits among Chang'an, Ford, Mazda on a separation of production and sales, the three parties achieved an agreement that Mazda participate into Chang'an Ford shares, and Chang'an Ford also participate into FAW Mazda shares at appropriate time.

ON April 5, 2006, Chang'an Automobile (000625) announced that approved by the Ministry of Commerce, Ford Motor plans to transfer the 15% share holdings of Chang'an Ford to Mazda.

But one month after the listing of Mazda 3, Chang'an Ford still could not get the desired FAW Mazda shares. As in FAW Mazda, Mazda, only holds 25% of the equity, the remaining 75% of the shares are held by FAW Sedan and FAW Group. On the issue of Chang'an Ford's participant to FAW Mazda, FAW Group is unwilling to give up its shares and Mazda, is only willing to give 5% of the equity. Changan Ford is not satisfied, and then production of Mazda 3 was suspended.

Mazda 3 restarted on October 30th last year, and the production was remaining at levels of 30 per day, which is far from the original goal of 20,000 vehicles sales in 2006. Mazda's overall sales in China in 2006 are 112,000 units, with a decline of 20,000 vehicles compared to 130,000 units in 2005. And last year, car sales in China grew over 37%. 2006 become the most frustrate year for Mazda in China.