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June 10, 2023

There's No Stopping Mazda Philippines' Move Upmarket

Mazda Philippines thinks it’s the right time for them to move to the “premium mainstream” space. With the introduction of the CX-60—their third “7G” model after the Mazda3 and CX-30, and the first riding on the Large Product Group platform, the Japanese brand says they’re ready to shake off their mainstream positioning.

According to Steven Tan, Mazda Philippines’ president and CEO, the writing’s been on the wall for quite some time. During the media launch of the CX-60, Tan started the presentations with a history lesson—one that showed Mazda’s product mix since Berjaya Auto Philippines (later Bermaz Auto Philippines) took over the distributorship in 2013.

During the first seven years of operations, Mazda relied heavily on two entry-level models: the Mazda2 and Mazda3. These two models combined made up almost 50 percent of their annual sales, peaking in 2015 at 64 percent. Tan even jokingly referred to his company as the “Mazda3 company” since that single nameplate alone accounted for close to 40 percent of total company sales at one point.

However, from 2019, as Mazda started introducing the CX-30 and CX-8, as well as more variants of the CX-5, there was a clear shift towards SUVs. Along with the CX-3 and CX-9, the CX line-up made up 39 percent of total sales. Two years later, it peaked at 64 percent. Today, based on year-to-date sales, it’s almost half; a healthy number that shows the strength of the entire line-up as opposed to just one nameplate.

The trending echoes the global market in that there’s a strong preference towards SUVs and crossovers over sedans and hatchbacks. But drilling down on numbers, it’s surprising how one car continues to buck the trend, and it’s a niche product at that: the MX-5. From just one percent of total sales in 2013, today, the two-seater accounts for 16 percent.

Mazda showed that over time, the average SRP of their vehicles have gone up. From 1.357 million in 2013, it went up to P 2.008 million in 2021 and then to P 2.241 million in 2023.

It’s very clear that Mazda no longer has to compete against low-margin, high-volume products; something now heavily populated by Chinese brands. Instead, they’re happy to be more of a low volume, niche player; one that ultimately puts product and customer experience at the center.

And Tan thinks this trend will continue upward as the CX-60 starts hitting showroom floors and more 7G models like the CX-90 arrive to the market. Although Mazda Philippines hasn’t divulged any official pricing info on the CX-90, it will likely breach the P 3.5-million mark given its similarly-sized competitors, the Hyundai Palisade and Subaru Evoltis are in that price range.

Of course, Tan realizes that Mazda’s premium positioning must be in lockstep with a better dealership experience. Afterall, dealerships often serve as the first physical touchpoint buyers have with a brand.

To that end, he’s confirmed that two main dealerships, Mazda Makati and Mazda Alabang, will undergo refurbishment in the next six months. In addition, Mazda C5 which sports the new Corporate Identity, will re-open in July in a new location.

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