Sales of the new-generation Mazda 3 have fallen by about one-third over those of its predecessor model, but the company this week stood by its decision to move the car upmarket with higher pricing and a greater list of standard equipment.
Figures show that between June 2019 and January 2020 - the period over which the hatchback and sedan models have been on sale - 13,587 Mazda 3s were sold, averaging about 1700 units a month.
Over the same period in the previous year/s when the cheaper but less well-equipped previous Mazda 3 was on sale, this figure was 20,133, at an average of 2500 a month. That’s a reduction, between generations, of 33.5 per cent.
In the most recent month of data, the Mazda 3’s share of the segment declined from 20.4 per cent in January 2019 to 12.9 per cent in 2020. Once a segment sales leader, it sat fourth behind the Toyota Corolla, Hyundai i30, and Kia Cerato.
True enough, sales of small cars in general declined substantially over the same period. However, the reduction was from 120,032 cars between June 2018 and January 2019, to 95,861 between June 2019 and January 2020 – equal to a decline of 21.1 per cent.
So the decline in Mazda 3 sales has been 33 per cent greater than in the overall segment.
Befitting its stance as a ‘cut above’ purely price-focused brands, the company upped the price of entry to the Mazda 3 by $4500. For bargain hunters, the entry G20 Pure is $4000 pricier than a base Cerato S, $5000 more than an i30 Go, and $1655 more than a Corolla Ascent.
But on the flip side, Mazda has fitted it with a list of features that goes well beyond a typical ‘base car’, more equivalent to a mid-level vehicle, which inarguably puts the pricing into better context.
For instance, every version of the 3 gets an 8.8-inch screen with satellite navigation, a projecting head-up display, LED headlights, autonomous emergency braking (AEB), blind-spot monitoring, lane-keeping assist, and active cruise control.
We flagged all of this with Mazda Australia’s managing director Vinesh Bhindi at the launch of the new CX-30 SUV this week. Did Mazda stand by its product planning or had it miscalculated public demand?
In fairness before we begin, Mazda did expect as much, as this old story says.
“It was absolutely the right call and the right direction for us,” he contended, adding that the private market in general was in a slow period, causing consumer confidence to take a hit. Therefore a monthly sales average of 1400 cars was deemed acceptable.
"From our point of view we focus on offering a compelling value proposition, and one of the value propositions we believe is the right thing to do, is to offer a lot of features that are standard.
“And the reason why we consider that to be fairly important is whoever is buying cars in this timeframe, when they come to trade it in three to five years time, we believe the consumers who will purchase that second-hand car will have moved on to say 'these features are something I need in a secondhand car'.
“It’s protecting the value of the asset, an individual saves their hard-earned dollars to purchase. It’s happened with other features in decades gone by, and we believe some of the features we are offering as standard will become those as well.”
So, while sales are down, Mazda essentially suggests that its decision to up-spec its former top-seller will future-proof it.
The other side of the coin is that the new CX-30 SUV, which shares most of its components with the 3, is expected to account for 800 monthly sales, and while it will pinch a few prospective 3 buyers, will also take CX-3 and CX-5 buyers, and from other brands too.
While overall new vehicle sales fell 7.8 per cent last year, Mazda's fell 12.3 per cent. However, with 97,619 sales, it remains number two overall behind Toyota.
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