Mazda cuts $3.3B from electric vehicle plans

Mazda is making massive changes in its electrification strategy, announcing that it will slash $3.3 billion from its EV plans. 

The details:  News of the shift is part of the Japanese automaker’s new “Lean Asset Strategy” and includes a “Multi-Solution” plan anchored in a more flexible production approach to manufacturing a diverse mix of powertrain offerings, including Battery Electric Vehicle (BEV), Hybrid, and Internal Combustion Engine (ICE) vehicles.   

• The plan includes Mazda cutting its investment in electrification from $13.3 billion to $10 billion, by leveraging existing partnerships with companies like China’s Changan, Toyota, Denso, and BluE Nexus.

• Mazda expects the more flexible production strategy to reduce its investment by about 85% and cut the production lead time by around 80% for a hybrid version of its next-generation CX-5. 

Why it matters: Mazda joins a growing list of mass-market car companies modifying their EV strategies to better align with consumer demand. In 2024, the Japanese automaker posted record sales, with over 420,000 vehicles delivered (a 16% increase compared to 2023), without a single EV in its lineup.  

Zeroing in: The company’s new plan that calls for changing its approach to EV production will play out several ways regarding future powertrain and products across the Mazda line-up. 

• Mazda’s SkyActiv-Z platform is a core component of the company’s new strategy, with the next-gen CX-5 slated to debut later this year being the first vehicle to feature the new engine. 

• The hybrid version of the next-gen CX-5, which will be equipped with the SkyActiv-Z, is expected to arrive by the end of 2027.

• Mazda aims to expand its use of the SkyActiv-Z technology beyond the four-cylinder variant, with plans to adopt the platform for inline-six engines for larger models.

Bottom line: Instead of going all-in on electrification, Mazda is betting on a flexible strategy that balances hybrids, ICE, and BEVs—mirroring what’s worked for Toyota. Given its record sales without a single EV, Mazda’s cautious pivot could pay off in a market that’s still figuring out its EV appetite.  

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