Mazda conquered the market for rotary vehicles in the United States from the north 50 years ago and has provided a steady stream of fun-to-drive cars to its dealers — along with more than one existential crisis — decade after decade. The journey at times was challenging for retailers, but never dull.
The Japanese brand arrived in Canada in 1968 after successfully producing its debut rotary engine car, the Cosmo, in Japan. “We came down from the north and set up a good dealer with University Mazda in Seattle,” said Masahiro Moro, CEO of Mazda North American operations.
The big draw for dealers and customers to the brand was its uniqueness. No other automaker had mastered production of the rotary engine, which spins a rotor in a circle rather than pistons going up and down, offering strong power and smooth operation in a compact size, Moro told Automotive News.
“Mazda was a new brand in the United States from the Far East. Fortunately, we had a product with a rotary engine,” said Moro. “So, we were trying to surprise dealers and customers with a very different engine. Our product lineup at that time was only rotary engines to start.”
And surprise it did.
A classic Mazda ad for one of its first models in the U.S. — the 1972 RX-3 in sedan, coupe and wagon — carried the singsong tag line: “Piston engine goes boing, boing, boing, boing, boing, boing, boing, but the Mazda goes hmmmmm.” It featured a kid on a pogo stick to accompany the “boing, boing.”
The dealer network was established on the East and West coasts, partly because that’s where the cargo ships arrived carrying the newfangled rotary cars from Japan, Moro said. Later, it expanded into the interior of the U.S. as Japanese brands in general became more popular.
Unfortunately, the first crisis for the upstart brand and its early retailers came with the oil shocks of the 1970s. The rotary engine was thirsty compared with its piston-engined rivals. In a 1972 test drive, Road & Track magazine estimated the RX-3’s mpg at about 20 percent worse than a comparable piston engine.
But Mazda’s U.S. adventure is also a story of luck: The brand made piston-engine cars in its home market and introduced the GLC, or Great Little Car, in 1977. “We needed to come up with an affordable, very stylish five-door,” said Moro, whose first car was a GLC. “It’s a very quick turnaround from the crisis.”
It was also a major hit.
Paul Walser, co-owner of Walser Automotive Group in Edina, Minn., is a second-generation Mazda dealer and remembers the arrival of the GLC. His father, Jack Walser, added a Mazda dealership to his group of American brands around 1977 just before the new piston-engine wonder hit the market.
“My dad acquired it from the dealer that had it, and I think all he had to do was buy the cars and the parts. I don’t think there was any kind of premium involved. In those days, it just didn’t command anything. But it got really good very fast, so it was almost as if my dad had some look into the future,” he said.
“It was all rotary stuff, but then the GLC came out and that car was hotter than a pistol,” Walser said. “It was a nonrotary product and it sold very well. And then a year later, the RX-7 came out and that was a big deal. The Mazda RX-7 was unlike anything else, both because it had a rotary engine and was a relatively economically priced sports car that had some very good performance.”
The RX-7 turned out to be another well-timed hit for the brand and restored its rotary halo while the mainstream, piston engine cars were gaining accolades, and sales, on their reputation for fuel economy, build quality and fun.
Walser bought his own Mazda store in 1989 — the same year the MX-5 Miata was introduced at the Chicago Auto Show — and later merged it with his father’s store. “Products like the RX-7 and the Miata, these are things that create an image to the public that transcends into the rest of the product line.”
The Zoom-Zoom marketing campaign, beginning in 2000, embodied that spirit, he said.
“There’s been up and down years, but generally if you look at it over the course of the last 30, 40 years, for the most part there’s been a nice increase,” he said. “I don’t ever remember us having a year when we lost money with it, so it’s been a pretty steady winner for us over the course of its history.”
Moro said that Mazda’s three distributors over the course of the 1980s — West Coast, East Coast and Great Lakes — competed with one another to add dealerships. By 1994, the dealer network hit its peak at 935 stores. In the late 1990s, Mazda faced a fresh crisis, spurred in part by exchange rates.
Mazda shed dealers in the years following the exchange-rate crisis, to about 750. That was followed by the U.S. financial crisis that began in 2008. Now, after the restructuring of the dealer network, the count stands at about 550 as Mazda goes through its transformation to a more premium brand.
Moro said that many Mazda dealers have stayed with the franchise even though it commands around only 2 percent of the market. “It’s very interesting because they simply love Mazda,” he said. “They love to drive the cars and they are emotionally engaged with the brand, our vision and the product.”
Walser agreed and is investing in the Retail Evolution facility updates to push Mazda to the next level. “For the dealers that understand it and make the investment, it can be a terrific franchise holding,” he said. “I’m a big fan of this brand and I would do anything to help them continue on their journey.”