August 28, 2013 in Business

Japan plant innovations boost Mazda’s roll-off rate

Yuri Kageyama Associated Press
Associated Press photo

Mazda employees work on the assembly line of the Mazda6 model at its plant in Hofu, Yamaguchi prefecture, southwestern Japan, on Tuesday. Mazda’s new plant is rolling off vehicles at a rate of one every 54 seconds.
(Full-size photo)

HOFU, Japan – Mazda, the longtime also-ran of Japanese automakers, says it came up with innovations in nearly every step of auto manufacturing for a super-efficient assembly line that rolls off vehicles at a stunning rate of one every 54 seconds.

The revamped Hofu plant in Yamaguchi prefecture, southwestern Japan, shown to reporters Tuesday, underlines how Mazda Motor Corp. has defied skeptics who predicted the automaker’s demise after Ford Motor Co. ended a long partnership.

Contrary to expectations, Mazda was not bought by a Chinese competitor. Nor did it collapse under the burden of a soaring yen that made Japanese cars more expensive abroad.

Mazda is still riding on its reputation for producing cool gas-sipping models such as the Miata roadster without a single gas-electric hybrid in its lineup. The Hofu plant can barely keep up with demand. Its pace betters that of Toyota Motor Corp., the world’s top automaker, which can roll out a vehicle at paces varying from 57 seconds to 115 seconds.

The key to what Mazda calls its innovation in “monozukuri,” or “making things,” apparent at the Hofu plant, was using a common platform, the main structure on which a car is built, and common parts. Platform-sharing is a standard profit-boosting device in the auto industry, but is even more crucial for a smaller player such as Mazda, allowing it to create several distinct models from what in basic ways is the same car. After its partnership with Ford ended three years ago, Mazda needed a new approach.

Mazda says it took the process a step further and unified platforms and parts at the design and development stage. It believes it has elevated the standard for an assembly line that can produce multiple-size vehicles to a new level of leanness and efficiency.

Mazda officials said it will introduce all the innovations it came up with for the Hofu plant they call “the mother plant” at its new plant in Mexico, set to go into production next year.

The Hofu plant, first opened in 1981, rolled out its 10 millionth car, a Mazda6 sedan, off its line Tuesday.

“We see this as one step toward further growth,” said President Masamichi Kogai at a roll-off celebration.

The Hofu plant produced 350,000 vehicles last year, down from its peak at above 500,000 in 2007, but that’s recovering this year to about 400,000 vehicles.

Still, Mazda has gone through hard times.

Ford, which had owned a third of Mazda and was its main partner for three decades, gradually pulled out. The U.S. automaker, based in Dearborn, Mich., gave up its top stakeholder position in Mazda in 2010.

At a time when Japanese rivals are moving production abroad, Mazda still produces 60 percent of its vehicles in Japan. Of the vehicles produced at Hofu, 94 percent are exports. That has left Mazda vulnerable in periods when the yen is strong.

But the unfavorable currency rate has changed course since last year, providing an unexpected lift for the Hiroshima-based automaker. Mazda had honed in on cost cuts and efficiency partly because it wanted to be able to eke out profits even with a high yen.

Mazda is planning to raise overseas production to 50 percent of total output by the 2015 fiscal year. It is also aiming to increase annual global sales to 1.7 million vehicles by 2017, up from the current 1.2 million.

It is well on its way to achieve its profit forecasts for the fiscal year ending March 2014 at $700 million, according to Mazda.

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