Mid-Term Management Plan Update and Management Policy up to 2030
(Announced on November 22, 2022)
On November 22, 2022, Mazda provided an update on its Mid-Term Management Plan and announced its management policy up to 2030.
Mazda has been promoting its Mid-Term Management Plan toward achieving financial targets up to FY March 2026. However, given increasing uncertainty surrounding its business environment, such as trends in environmental regulations in each country and social infrastructure development, as well as changes in the power mix and consumer choices, Mazda has presented its management policy and major initiatives based on assumptions of global trends by looking further ahead to the period up to 2030.
Basic Management Policies up to 2030
As the automotive industry undergoes a large transformation, due to the evolution of digital technology and the entry of new players in the automotive industry, more diverse products are introduced in the market. By connecting with IoT, various functions and services are possible and thus, values that vehicles can offer to the society are expected to continue to change and increase.
We will continue to expand our brand essence, Joy of Driving, by developing technologies and adapting our business management to meet the needs of the times. By creating daily driving a more moving experience, we aim to Uplift and Energize People, Bringing More Enjoyment to Everyday Life. To that end, we will continue to undertake research on human based on Human-Centered philosophy, committing to Engineering and Manufacturing, Create Human Connections and develop people that uplift the mind and body.
Management Policies in Each Phase During the Period up to 2030
In this phase, while storing resources for future electrification, we will strengthen our technology development in our R&D and manufacturing areas in preparation for the full-fledged electrification. Maximizing the use of our U.S. plant, multiple electrification technology assets, and Large products, which Mazda has invested in, we will put Mazda’s business on a growth path and strengthen our financial base to enable us to deal with another economic crisis like the novel coronavirus (COVID-19) pandemic with cash on hand. At the same time, we will build a business structure that is highly resilient to changes in the environment by strengthening our supply chains and cost reduction efforts.
As regulations become more stringent, this phase will be a transition phase to electrification. During this period, continuing to earn profits from Internal Combustion Engine (hereinafter ICE) vehicles to maintain and improve our financial base, we will also strengthen our preparations for the age of full-fledged electrification. By closely monitoring market demand, government regulations and policies and a course of technological advancement, we now have good prospects for procuring the batteries we need from our business partners. In addition, we will continue to strengthen our battery R&D and manufacturing technology development, to establish the necessary technology and secure its cost competitiveness. We will further refine and fully use our multiple electrification technologies, and commence the launch of battery EV vehicles from the latter half of this phase.
In this phase with 2030 as the final year, we will undertake a full-fledged launch of battery EVs. Toward the age of full-fledged electrification, by closely monitoring market demand, regulations, government policies and a course of technological advancement, we will consider matters such as investing in the batteries production.
Key Initiatives to Open up the Future
“CO-CREATION IN PARTNERSHIP”
Based on the idea of “Co-creation and coexistence” we value co-creation with partners when promoting collaboration projects with them. At the same time, we will build a framework for developing new technologies and resolving issues, and further refine our own strengths.
1. CARBON NEUTRALITY
Toward endeavoring for carbon neutrality (hereinafter, “CN”) by 2050, we have announced our commitment to making Mazda factories CN worldwide by 2035 in an effort to reduce CO2 emissions within the Group as interim plan. We have also set a plan to promote initiatives under the following three pillars: reducing the use of energy, the shift to renewable energy sources, and the introduction of CN fuels
In addition to Mazda’s efforts, those on the side of supply chains will also be necessary. Therefore, we will proceed with CO2 emission reduction activities with our logistics companies and suppliers in stages. In Japan, we will work on structural reforms in supply chains while expanding the use of CN fuels.
During a period of transition to EVs, we believe that it is effective to take a multiple-solution approach, in which we provide appropriate combinations of products that suit electric power generating infrastructure in each region. Meanwhile, Mazda assumes that its global EV ratio in 2030 will be between 25 and 40%, considering electrification policies and tighter regulations on emissions in each country. Based on this assumption, we are promoting electrification in stages by working closely with our partner companies.
Electrification Initiatives in Each Phase
Strengthening development for the age of electrification
- Make full use of our multiple electrification technology assets
- Proceed with full-fledged development of technologies for BEVs while enhancing earning power with the introduction of Large Product group models and products that achieve both environmental and driving performance such as plug-in hybrids and diesel engines with a mild hybrid system.
Transition to Electrification
- Reduce CO2 by introducing new hybrid systems for improving fuel economy
- Commence global launch of BEVs
- Collaborate in core electric drive units to create competitive next-generation electric drive units
- Established with local partner companies a joint venture company for developing high-efficiency production technology and establishing systems required for the production and supply of electric drive units
- Signed a joint development agreement and established a joint venture company for the development of an inverter, one of the core parts of an electric drive unit
- Signed joint development agreements and establish joint venture companies to learn and develop motor technologies
- Procure batteries from partner companies while promoting research and development of Mazda’s advanced battery technologies adopted by the Green Innovation Fund Project
Full-fledged launch of pure battery EVs
- Move forward in efforts for the full-fledged launch of pure battery EV models
- Shift our focus to full-scale electrification including investment in battery production in light of changes in the external environment and progress in strengthening our financial foundation
3. VALUE CREATION THROUGH CO-CREATION BETWEEN PEOPLE AND IT
Based on its Human-Centered philosophy, Mazda has relentlessly conducted in-depth research of people and the Joy of Driving perceived by the five senses. The foundation of these initiatives is Mazda Digital Innovation, which we have been working on since the 1990s. Making full use of Mazda’s proprietary IT knowledge and skills, Mazda engineers have worked hard to significantly streamline technology development.
These efforts have resulted in process innovation, which includes “Model-Based Development,” Mazda’s unique capability in high-efficiency development, and the creation of higher added value for customers at the same time, qualities which set Mazda apart from its competitors.
In line with our safety philosophy, Mazda Proactive Safety, we will push forward with our ongoing efforts to develop human-centered advanced driver assistance technology through exhaustive exploitation of our IT technology based on our research on people, and we will aim for no new Mazda to cause an avoidable fatal accident through our advanced automotive technologies by 2040.
4. COST REDUCTION AND SUPPLY CHAIN ENHANCEMENT
We will expand the scope of our cost reduction efforts. From a comprehensive viewpoint, we will also look into both value chains and supply chains in addition to our existing scope that looks to product cost and production cost, and change these to allow us to thoroughly eliminate waste, irregularities and overburdens to make costs ideally effective.
For our supply chains, we have improved costs for each process, but from now on, we will work to optimize the entire process that spans from material procurement to product delivery to customers by making the flow of goods as smooth as possible at the highest speed. Furthermore, we are working on innovative changes in our procurement system which includes fewer tiers in procurement of materials and parts and bringing places where various parts are produced closer to our production facilities as well as using more highly versatile materials and semiconductors. In this way, we will minimize the impact of external changes in the environment such as geopolitical incidents, COVID-19 and earthquakes and other large-scale disasters.
MANAGEMENT GUIDELINES FOR FYE MARCH 2026
FINANCIAL METRICS FOR FYE MARCH 2026
In terms of our major financial metrics targets in FYE March 2026, considering uncertain business environment, we will focus on accomplishing the targets stated in the Mid-Term Management Plan Revision announced in November 2020.
In areas other than financials, we will make our business more sustainable through initiatives to achieve carbon neutrality at our global production facilities by 2035 and we are aiming for zero fatal accidents caused by any new Mazda by 2040 in line with Mazda’s basic policy for sustainability.
We see CO2 emission reduction, which is a major index of social contribution in terms of efforts to curb global warming, as a particularly important value of Mazda and we will keep monitoring this based on further detailed breakdown of the goals.
INVEST IN PEOPLE AS THE SOURCE OF VALUE CREATION
The source of our efforts to contribute to solutions for global and social challenges and to create Mazda’s unique value is the people that make up the Mazda Group.
Addressing changes in the labor force and working practices, we will pursue employee-friendliness and job satisfaction and make Mazda an attractive company where every employee can work enthusiastically with pride.
In addition, to enable our employees to work to the fullest and to grow, Mazda will invest in various areas including human resource development that leads to the growth of the company.
To raise the level of our company’s digital literacy, we will invest in company-wide development of human resources to train employees skilled in AI. Furthermore, by 2030, we aim to double our productivity and transfer such resources to work that produces greater added value by reevaluating added value of work tasks in all areas and modeling work processes.