TOKYO - Mazda Motor Corp.'s new midterm plan is as much about repositioning the company within the Ford Motor Co. family as it is about restructuring.
At least, that's the way President Mark Fields sees it.
'I want us to become an indispensable part of the Ford group, to carve out our position,' Fields said in presenting the plan here on Nov. 17. 'We are not just Ford's Asian play.'
To that end, Mazda has been designated as Ford's center of excellence for two tasks: engineering large four-cylinder engines, which represent 2 million units worldwide for Ford, and developing mid-sized front-wheel-drive platforms.
The latter task, however, could be blown out of the water by Ford's other brands.
The main element of Mazda's restructuring plan calls for shifting 100,000 units of annual production from Japan to Europe to reduce the automaker's huge exchange-rate exposure. The company suffered a $44 million operating loss in the just-ended first half, largely because of the strong yen against the dollar and euro.
Mazda will begin building the next-generation Demio subcompact at an undetermined Ford plant in Europe in 2002. Development of that car already has begun, with Ford of Europe taking the lead in the engineering.
Then, a five-door hatchback version of the next-generation 323/Protege compact will go into production in Europe beginning in 2003. Production sites will be announced in January.
As part of the shift, Mazda will close a plant in Hiroshima that builds the Demio and 323. That will reduce the company's straight-time capacity in Japan by 266,000 units or about 25 percent.
Mazda will take a $250 million charge this fiscal year to cover that plant closing and the cost of early-retirement packages for 1,800 white-collar workers.
By juggling the rest of its Japan production among its remaining lines, and assuming higher sales based on new models, Mazda plans to bring its capacity-utilization ratio to exceed 100 percent over the next five years.
Fields said that being able to shift production to Ford of Europe to offset currency exposure is just one benefit of being part of the Ford group. By sharing product programs, Mazda is able to cut its per-unit engineering costs by between 10 percent and 50 percent, depending on the program, he said. That lowers variable costs by an average $139 a vehicle, he said.
Although the mid-sized platform responsibility appears to give Mazda a major role in Ford's worldwide development programs, Fields admitted that not every brand may want Mazda engineering. In fact, he implied that it isn't certain for whom Mazda will be doing the engineering work.
Ford has a history of trying to develop so-called world cars engineered by one designated center of excellence, such as Ford of Europe. Those cars mostly have failed. Either key markets dropped out, citing special needs that couldn't be met by a car designed on other shores, or the resulting car was too much of a compromise.
Fields is aware of that history. Now, instead of trying to commonize 'the sheet metal, screws and everything,' he said that Mazda and Ford would seek to common-ize the platform and let other parts be designed for local needs.
The new vision of centers of excellence is one where 'you don't end up with tit-for-tat discussions ... with products that are almost the same and mediocre,' he said.
With the first car it engineers in this segment, a replacement for the 626, Mazda will be out to 'delineate and demonstrate our expertise' in vehicle engineering, he said.
The implication: Ford's top brass may have anointed Mazda as a center of excellence for mid-sized car engineering, and Ford of Europe may be willing to engineer the next Mazda Demio, but Ford has not agreed to let Mazda engineer the next-generation Mondeo.