Mazda Hopes MPV Will Move Sales

KESWICK, VA - Ferrying our Mazda minivans in pairs across the picturesque James River on a raft nudged along by men with long poles, we are steeped in historic scenery. In one direction sits Monticello, home of Thomas Jefferson. In another, Appomattox Court House, where Lee's surrender to Grant ended a horrific civil war and determined the fate of the fledgling nation.

Later, as we back our vehicles into a circle and flip our third-row seats rearward for a tailgate picnic, we are reminded of our purpose, not nearly as noble but notable nevertheless.

Mazda Motor Corp., looking to meld its U.S. product lineup with that of other mainstream car companies, believes it has a serious contender with the all-new 2000 MPV front-drive minivan that goes on sale this month. Mazda now offers five vehicles for the North American market that will further be enhanced by the addition of Ford Motor Co.'s upcoming U204 small sport/utility in 2001.

Mazda's North American arm overall is feeling quite good about itself these days, having contributed close to half of the Japanese parent company's net profits for fiscal 1998-'99 - the first consolidated profit in six years and the highest in 14 years. The Japanese carmaker reported a consolidated net income of $321.1 million, reflecting a $377.5 million increase over the previous year.

Richard Beattie, president of Mazda's North American Operations, took the helm in 1997. "We account for 40% to 45% of corporate profits - more than our fair share. I'm pleased with the progress we're making," he says.

Mazda's U.S. sales were up 8.4%, or 20,000 vehicles, for 1998 - the first year-on-year increase in four years. That's still off 140,000 vehicles from the 1986 peak, but, notes Mr. Beattie, it's moving in the right direction.

"This minivan is very significant for us," Mr. Beattie says. Aggressively benchmarking the Honda Odyssey, MVP's clean but distinctive style reflects an international effort by Mazda's four research and design centers - Irvine, CA, Frankfurt, Germany, and Yokohama and Hiroshima, Japan.

Built on a modified 626 platform, the new minivan is powered by Ford's 170-hp Duratec V-6. Unlike the version found in the Mondeo/Contour, the Mazda version is actually 0.05L smaller, 2.49L vs. 2.54L. This was done to get under Japan's tax on V-6 engines larger than 2.5L. This is the first Ford engine in a Mazda, and - while it suits most overseas markets - Mazda officials say that the engine leaves the MPV "torque-challenged" for U.S. tastes. The previous version of the MPV boasted a 3L, 155-hp engine.

Martin R. Leach, managing director of Mazda's product planning, design and programs, says a 5-speed transmission might make the difference. The automaker is considering its options. "We suspected the North American market might challenge us on displacement," he says, while pointing to the short-wheelbase Dodge Caravan, which has 150 hp. "We would like to be closer to Honda (210 hp)," he says, "but we are more powerful than the segment leader."

Mazda is most proud that the new MPV features dual sliding doors with power windows, a first in the industry. Like the Odyssey, MPV has second-row captain chairs that slide side-by-side to form a bench seat. The third-row seat folds flat into the floor or can be flipped over to face rearward, allowing passengers to sit with the tailgate open.

Prices range from $19,995 for the base DX to $22,050 for the anticipated volume-leader LX and $25,550 for the EX.

Mazda will build 90,000 MPVs at its Hiroshima plant next year, anticipating sales of 40,000 or more in North America. - Said Deep contributed to this report