Craig Roberts, managing director of Mazda South Africa. Picture: Supplied
Mazda South Africa, the importer of the well-known global brand, has held onto its market share this year despite a volatile vehicle market characterised by falling sales for most of the period and a big number of new competitors.
MD of the local business Craig Roberts said in an interview that it is important to understand why this stabilisation of market share, even though it does not yet indicate growth, is so important for the future of the company in this country.
In 2019, the Japan-based parent company moved its strategy to become a global exporter of larger, more premium-priced vehicle models, a strategy that proved successful in most major markets where the group operates, such as the US, Canada, some South American countries, Europe, and Australia.
However, this strategy saw the local company face the fact that it was likely to lose market share, most notably because South African consumers have lower disposable incomes than in many other vehicle markets, and its consumers are price sensitive when it comes to cars.
On top of that, Mazda South Africa, until 2018, primarily sold its BT-50 range of commercial vehicles in South Africa, and the new strategy called for more vehicles in the passenger car platform to be sold, said Roberts.
The sale of the BT-50 commercial vehicles was also suspended in South Africa due to very competitive pricing from local manufacturers in the commercial vehicle market segment, and the comparatively high price of importing them considering factors such as a weak and volatile rand exchange rate.
Consequently, Mazda South Africa experienced what Roberts termed as “big hits” in losing market share in 2020, 2021, and in the first half of 2023. In terms of meeting the requirements of the global strategy of more premium positioning and larger platform vehicles, though, it was “mission accomplished.”
He said the strategy meant, however, that Mazda South Africa only had one model, the Mazda 2, for sale in the biggest segment of the passenger car market, where new vehicles are priced below R350 000.
The Mazda 2 currently retails for around R 321 000 and competes with other cars in its segment including the Polo and Polo Vivo, Kia Rio, Toyota Yaris, and Hyundai I20.
In this context, the fact that Mazda South Africa, with its 6-model passenger car line-up in the South African market, managed to hold onto its market share and remain profitable as a company in 2023/4 indicates that it is performing well, and, in the context also of signs of a recovery in overall vehicle sales, it could signal that the group is poised to regain market share, he said.
He said that in spite of the challenges the company has faced in the local market this year, including port-related delays for parts and replacement equipment, and increased competition, which is also a challenge facing most global markets, the company’s compact SUV, the Mazda CX-5, remained its top-selling model in South Africa.
Roberts said their strategy was to steadily grow market share in the segments of the market where Mazda South Africa operates, and they “look forward to a long and good future in South Africa.”
The company also recently concluded a rationalisation of the dealerships that sell its vehicles from 53 to 33, an initiative driven in the main by changing market dynamics, including, for instance, terminating dealership agreements with dealerships in areas that no longer presented viable opportunities aligned to Mazda’s current and future product line-up. A new CX-5 should debut globally in 2025 and in the South African market in the first half of 2026, said Roberts.
Meanwhile, parent company Mazda Motor Corporation, in contrast to many other major motor manufacturers globally, is performing strongly and reported a 12% increase in sales to 1.24 million global sales in the 12 months to March 31, 2024, while its net income, which would have also benefited from dividends from Mazda South Africa, increased by 45% to 207.7 billion.
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