Mazda Australia says it has no plans to increase prices despite the company’s global vice chairman telling journalists that prices may gradually creep up to levels rivalling premium brands.
Speaking with CarAdvice at Mazda’s Mine proving ground near Nagato city in Japan, Mazda Australia boss Martin Benders clarified the brand's position in Australia.
“We are not talking about premium as in we want to be an Audi or BMW,” Benders said.
“We want to have the emotional appeal that drives those sorts of people, but we want to do it in the non-premium space.”
Bender said there are three categories of car buyers in general: those that are actively interested in their cars and know what they want, those that like the way it looks or operates, and the third category that just needs a car out of necessity. Mazda, he said, wants to appeal more to the first two categories of buyers.
“If we look at where most buyers are, they are in the non-premium segment, we want to behave more like the premium [manufacturers] in that segment as opposed to the people that are just appealing to supply a transport solution for you.”
“These people [first and second category] are prepared to pay more than these people [third category] for what they want. So long as you've got the product they want and deliver the experience they want, you’re going to do better there.”
Mazda’s global strategy to go more premium in terms of pricing does not apply to Australia, Benders confirmed, where the brand is a volume player (it's currently the third best-selling brand so far this year).
“In Australia where we are doing nine to 10 per cent [market share], we can’t be out of the price range, we can’t say we are going to be $5000 more than everyone else, but we can be a little more than the Hyundais of this world.”
Benders' strategy sees Mazda position itself as an affordable, premium-like brand in the broad appeal category.
“We want to build a range of cars that over time appeal more consistently to those people [first and second category], which is what the premiums have done, but the premiums are priced at a level where the number of people they can appeal to has shrunk just by the amount they can afford.”
Benders pointed out that there’s plenty of precedent to know that suddenly charging more and wanting to be a premium brand doesn’t necessarily work in Australia.
“Are we going to go out and say we are premium and put our prices up? Like Volvo did a few years ago and realised it didn’t work? We are on a long road on this, we are not looking at getting into the premium territory, we still need the volume, especially in Australia.”
Benders denied the Mazda strategy had any similarities with Honda’s relatively failed attempt and becoming a more premium manufacturer a number of years back.
“What did Honda do? We are going to be premium now, we will put our prices up $3000 to $4000. Oh no, we are not going to be premium, we are going to drop it $3000 to $4000,” Benders joked.
“We are going to do it with the right product, we are not putting prices up in the sense of being out of the bulk of the range, but there’ a lot of ways you can have an average price that’s higher than the competition just by selling a richer mix.”
Benders confirmed that sales of the previous-generation Mazda 3 were made up of around 60 to 80 per cent in favour of the base model, but with the new model, at least 80 percent of new Mazda 3 buyers are picking the mid-spec Maxx or above.
But despite having no immediate intentions of raising prices, Benders admitted that if the supply and demand metric worked in the company’s favour, prices would likely increase.
“If we build enough aspiration and appeal and people want to buy more Mazdas, and if you can only get a certain number, then you can match price with demand level.”
Benders concluded by saying the vice chairman’s comments were more in regard to Mazda on a global scale.
“If you look at other markets, they can put prices up or down, it doesn’t make that much difference, there’s enough buyers around there. For us, it does make that much difference. We are not going to muck around with pricing that way.”
The Japanese brand has so far sold 42,536 cars in Australia this year – only 1905 units behind second placed Holden. Toyota remains dominant with 80,297.