Debt-beset Japanese auto manufacturer Mazda is to take direct control of the majority of its European distribution network. The move, combined with the launch of several new car marques, is the first step in its European recovery programme.

According to European president Mark Fields, Mazda expects to directly control some seventy per cent of its local sales volume by the end of 2000. The company has owned its German distribution channels for a number of years and in 2000 extended its ownership to Spain, Italy and Portugal.

The next step in the quest was taken earlier this year with the purchase of Mazda’s French sales concession from the Inchcape Group, which also holds 40% of the carmaker’s UK distribution company along with majority shareholder, Japanese investment bank Itochu. Acquisition of its UK sales outlets is said to top the shopping list.

Accounting for some 24% of global sales, Europe is a more important market for Mazda than for Japanese rivals Nissan, Toyota and Honda, for whom the region generates between 10%-15% of total sales.

Of the planned new models, around 100,000 small and compact cars will be manufactured annually in Europe, using spare Ford production capacity (the US carmaker has a 34% stake in Mazda), while the remainder will be imported. The raft of launches will, says Field, “help us rekindle the spark that was once our way of doing business”.

Marketing strategy remains under the wraps, although industry observers believe a major reappraisal is inevitable and could lead to reviews of creative advertising and media activity.

News source: Financial Times