The 2012 Mazda CX-5 is set to become a full replacement for the Japanese brand’s CX-7 SUV in Australia when it goes on sale around March.

Mazda’s CX-7 (below) has had only a relatively short lifespan, having launched in Australia in 2006, but the company’s incumbent Subaru Forester rival is all but officially confirmed to be usurped by the slightly smaller but better packaged and more technically advanced CX-5.

Mazda Australia spokesman Steve Maciver returned a question to CarAdvice when we tackled him on the company’s double-compact-SUV conundrum.

“With CX-5 being 50mm shorter in wheelbase but offering more interior space, more luggage capacity, having all-new engines, being more fuel efficient , and potentially being cheaper, do you think there’s room for both [vehicles in the market]?”“There will be a bit of an overlap [with the two models] - there will be a point where we’ll sell all three [CX] models, but without saying what’s happening to CX-7, CX-5 is our future for compact SUVs.

Mazda’s global boss, Takiri Yamanouchi, admitted to CarAdvice at the 2011 Tokyo motor show this week that the CX-5 and CX-7 would clash in some markets.

“The concern you have pointed out [about having two compact SUVs] is in a sense valid,” said Yamanouchi. “We think the different styling [of the two vehicles] dictates different customers . The CX-5 is more SUV-like, the CX-7 more sedan-like or crossover [style].“I think the CX-7 will be positioned in a higher pricing [bracket than it currently is], but I agree that in some markets it will be difficult to sell the two side by side. It will be left up to the decision of the distributor in each market.”

Australia is among only a handful of markets, though including North America, to sell the bigger, seven-seater CX-9 (below), making it a more natural option to drop the CX-7.

Yamanouchi confirmed Mazda will build next-generation versions of the CX-7 and CX-9, incorporating the company’s new Skyactiv fuel-efficiency-focused technologies.

Mazda Australia says it won’t rebadge the CX-9 as a CX-7 to create a naming strategy that would reflect the five-seater and seven-seater layouts of the CX-5 and CX-9 respectively.

“We’ve spent time investing in that [CX-9] nameplate, getting recognition for it, and we’re not going to start changing those nameplates now. CX-9 is what it is.”