What last year was Mazda Motor Corp.'s biggest headache has become a key earnings advantage: its heavy exposure to the Japanese yen.
Mazda builds about three-quarters of its vehicles in Japan, making it far more dependent on exports than Toyota, Honda and Nissan. As a result, an unfavorable yen rate was a major drag on Mazda's earnings for much of the past three years.
But this year, the yen has weakened considerably. A year ago, it took ¥80 to buy one dollar. Today, you need about ¥100 to buy a greenback. For exports from Japan, that's good. It means, in simple terms, that if Mazda takes in $20,000 on the U.S. sale of a car, that becomes ¥2 million now, vs. ¥1.6 million in 2012.
The swing has turbocharged Mazda's earnings.