Mazda is seeking loans for 300 billion Yen ($US 2.8 billion) from Japan’s three ‘megabanks’ and other lenders to help it get through the coronavirus pandemic, the Reuters news agency has reported.
Mazda, which has paused or slowed production in line with the rest of the automotive industry during the COVID-19 lockdowns, reportedly already has approximately $US6 billion in interest-bearing debt, which far exceeds its cash reserves, according to Japan’s flagship financial newspaper the Nikkei.
The Reuters news agency reported Mazda was in negotiations with three of Japan’s largest banks – Mitsubishi UFJ Financial Group, Sumitomo Mitsui Financial Group and Mizuho Financial Group – as well as the Development Bank of Japan, Sumitomo Mitsui Trust Holdings and others.
Some of the lending institutions have already extended the loans while others are poised to do so, the news wire service reported.
Mazda had been tightening its belt financially in the lead-up to the coronavirus crisis by cutting costs and increasing the prices of its cars.
In Australia, Mazda sales have declined for the past three years in a row and the 2019 result was the lowest annual tally since 2011.
Over the past two years, Mazda has crept up prices for some of its most popular models, however the company attributed the increases to currency pressure and extra equipment.
Since 2019, the cost of its cheapest model the Mazda2 city car has risen by between and $3800 and $5600.
Since 2018, the cost of the Mazda3small car has risen by between $4500 and $5100.
Prices for the Mazda CX-5 SUV have risen by approximately $2300.
Australia has historically been one of the biggest markets for Mazda globally – as a percentage of sales versus rivals – however its 2019 result was the first time its annual tally had been below the 100,000 mark in eight years.