Mazda turns first profit in five years

Trevor Hofmann - CAP staff
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While a weak yen might not be helping Japanese consumers who want to go "cross-border shopping" in neighbouring South Korea or China, it certainly has benefited Japanese automakers that predominantly manufacture their wares in the land of the rising sun. Mazda is such an automaker, and for the first time in five years the brand has actually turned a profit despite the economic downturn in Europe.

Good news to exporters, the yen has dropped some 16-percent over the past six months and therefore they're able to be more competitive. According to an Automotive News report, a one yen drop against the U.S. dollar will affect Mazda's operating profit by 9.1-percent, whereas Japanese automakers that manufacture in the North American markets don't suffer as much from a strong yen. The operating profit of Subaru parent Fuji Heavy Industries, for instance, is impacted by 4.7-percent by the same drop in the yen, whereas Toyota is only impacted by 3.1-percent.

Due to increased sales and profits Mazda's share value has tripled, now at its highest point since 2008. The brand's share values were in the dumps a year ago after the automaker created 1.22 billion new shares in a desperate move to raise cash. What a difference a year can make.  

Now with the Japan's currency slumping, Mazda's U.S. and Canadian divisions are profitable with the company's next fiscal year's projections expected to total US$279 million.
©(Copyright Canadian Auto Press)

Topics: Mazda, 2013, Mazdaspeed3, MX-5, Mazda2, Mazda3, Mazda6, Mazda5, Mazda3 SkyActiv,

Organizations: Mazda

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