Skyactiv Branding Doing Job in U.S., Mazda Exec Contends

NEW YORK – Mazda North America President Jim O’Sullivan has heard the criticism, but says the auto maker’s Skyactiv branding is doing its intended job in the U.S. for the Japanese auto maker.

Skyactiv is the catch-all label Mazda is slapping on its still-emerging suite of high-mileage engines, transmissions and lightweight vehicle architectures, as well as its overall engineering philosophy targeted at maximizing fuel efficiency.

But critics contend the name is nebulous and that few U.S. consumers understand the technology behind the Skyactiv brand. It’s safe to say the product badging so far hasn’t resonated as well as Volkswagen’s TDI nomenclature for clean-diesel technology or Ford’s EcoBoost branding of its modern, turbocharged gasoline engines.

Speaking here on the sidelines of the worldwide introduction of the new Mazda3, O’Sullivan tells WardsAuto it’s true not every customer fully understands the technical concepts behind Skyactiv. But they do know the branding stands for fuel efficiency and performance, he insists.

“Dealers say customers come in asking for it,” O’Sullivan says. “They want to know if the vehicles they’re looking at have Skyactiv.”

Mazda more fully explains Skyactiv engine, transmission and platform technology on its website, the top executive says, so car buyers who want to take a deep dive into the engineering behind the concept can do so.

“But (all) customers understand it’s about fuel economy and performance,” he adds. “They’re getting that.”

O’Sullivan says Skyactiv is more important as a philosophy and guiding beacon for vehicle design and production within Mazda than as a marketing slogan.

“It’s not just a brand, it’s a suite of technologies and a culture within the company that includes the manufacturing process,” he says, pointing to the auto maker’s ability to build both diesel and gasoline Skyactiv engines on a single production line. “It’s a mindset and an engineering philosophy, not just a brand,” he emphasizes.

Whatever the state of Skyactiv, something appears to be working for Mazda. Although overall U.S. sales are down 1.2% so far this year, the slight drop is attributed entirely to the aging car lineup, where the current Mazda3 is winding down and new Mazda6 is just rolling out.

The CX-5 cross/utility vehicle has been a hit both in the U.S. and worldwide, and supplies have been limited since the model was introduced in 2012. So far this year, sales of the CUV in the U.S. have nearly tripled like-2012 results.

Launch of the revamped ’13 Mazda6 flagship sedan also is “going very, very well,” O’Sullivan reports, adding he’s working to increase the allotment of both the Mazda6 and CX-5 for the North American market.

The new Mazda3 is expected to follow the same path, and the auto maker is increasing capacity with a new plant in Mexico to help meet worldwide demand for the car. Output there is slated to begin in spring 2014.

Mazda also continues to work its way out of its post-Lehman Shock financial hole. “We made money in our last fiscal year and we’re forecasting profitability for this year,” O’Sullivan notes. Analysts say income could triple in fiscal 2014 from 2012 levels.

The Mazda North America executive sees further opportunity to grow volume in the U.S., where the auto maker is targeting sales of 300,000 vehicles this year. He believes introduction of the Skyactiv diesel in the Mazda6 could be a game-changer for the auto maker in this market.

The new 2.2L turbodiesel will debut in the midsize sedan later this year and is expected to be offered in the CX-5, as well. The engine also is fitted to the new Mazda3 and could be made available in that car in the U.S., if customer demand warrants.

“There’s a huge opportunity for diesel in the U.S. market,” O’Sullivan says, noting Mazda is one of the few mainstream car brands with plans to jump into the segment.

He points to the success VW has had selling diesel-powered cars in North America. “TDI as a brand has become stronger than the Volkswagen brand,” he says, perhaps with just a hint of Skyactiv envy.

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