JOSÉ MARIA TEROL

Spain 2021 | INDUSTRY | VIP INTERVIEW

TBY talks to José Maria Terol, General Manager of Mazda, about the evolution of the company, the new MX-30, and a new generation of engines for 2022.

How has the company evolved over the last few years?

The last two years have been fairly intense. At a national level, 2019 was a record year for us in terms of sales volume and market share. In 2020, the vehicle market was hit hard by the pandemic. For Mazda, 2020 was a year of two halves. The lockdown in the first half of the year shut down dealerships, thus halting business. However, the easing of restrictions in the second half of the year lessened the pressure on the economy. In the latter period, business activity began to pick up, so things worked out relatively well. We broke our market share record by 1.67% once again. That said, the year as a whole was no doubt affected by the pandemic.

What is your view on the subsidies and incentives offered by the government such as Renove Plan or Moves to stimulate demand?

The car industry is the most important sector of the Spanish economy, in terms of both its contribution to GDP and the trade balance. It is the country's biggest export sector and has a great infrastructure of suppliers, pieces, dealerships, workshops, and more. It also generates quality employment and significant wealth, with training standards and salaries above the Spanish average, and is a driving force for other areas both directly and indirectly. Substantial government support for the sector is logical. It is necessary to drive forward improvements in decarbonization and emissions reduction and to combat climate change. Mazda has an extremely ambitious program to reduce emissions through the vehicles it sells between now and 2050. However, the tremendous effort that companies are making in terms of investment and technology in order to reduce these emissions is met with minimal subsidies from the European Union, and penalties for those manufacturers that fail to meet CO2 emission targets. The MOVES program has been poorly structured. Some regions have launched the scheme in different years, while others have failed to use the funds apportioned to them in 2020 or used up their allocated funds in just a few months. This is the only assistance manufacturers have received to promote the sale of electric cars, the demand for which is relatively low in Spain. It has been announced that the RENOVE scheme will not continue this year, and that the excess funds from 2020 will be redistributed. A new MOVES plan with similar features has been announced. I hope lessons have been learned from previous mistakes and that improvements have been made. On January 1, the WLTP came into force as a homologation system that produces a tax increase of between 5% and 60% on cars sold in Spain. There isn't another sector in Spain that is not currently receiving financial support and also receiving a tax increase in the current climate.

What are the features of the Mazda MX-30?

The Mazda MX-30 is designed for its primary purpose, which is to contribute to emissions reduction. Mazda believes that CO2 emissions should be assessed and measured via the well-to-wheel process. Electric cars produce less CO2 emissions than a conventional car when in use, but more emissions in their manufacturing and final recycling process. Therefore, using a battery that is the right size is fundamental. The issue is that the desire for large batteries for greater autonomy is becoming widespread, and the weight of the battery itself works against efficiency. Considering the electric car as an eminently urban car or an intercity car with a close-range is the best option. For those customers who need to make regular long-distance trips, the electric car is not the best solution. They should look for other alternatives. At the end of 2021, we will be presenting a new version of the MX-30. This version will include a rotary engine that will function as a generator and will serve to extend the autonomy of the car if necessary. We can use that rotary engine to recharge the autonomy and make a slightly longer trip. This engine uses Mazda technology, and we are the only manufacturer that uses it.

What are the sales expectations for 2021?

It is difficult to make predictions right now, but our latest forecasts are for 17,000 car sales. This would represent a growth of 21% on 2020.

Mazda intends to use existing technologies to reduce emissions. What strategy will be followed to achieve this objective?

We are working with hydrogen, but it is still years away from being a viable, widespread, and cost-competitive industrial energy force. In the more immediate term, we are working on electrification. By 2030, all our models will be electrified. Within this process, we are using different formulas, from pure electric, electric with autonomy extension, plug-in hybrids, and so on. In addition, we are continuing to work on improving the efficiency of our internal combustion engines, as most of the cars we sell will continue to have one. In 2022, we will launch a new generation of the product, which will incorporate a new generation of engines. These engines, combined, will produce extremely low emissions.

What is the main objective for 2021?

Aside from 21% growth, we have ongoing objectives. We have had a clear and well-defined strategy for years, which we have been working on steadily. For example, our digitalization and our dealer network digitalization, which has been accelerated by the pandemic. We also value loyalty and the customer experience. We want to continue improving in these areas, both in terms of car sales and after-sales. Often, all these go hand-in-hand.