Tariff blowback is driving Mazda to switch up its product strategy by shifting away from smaller cars in favor of larger SUVs.
The details: The Japanese automaker (which keeps breaking sales records) is prioritizing higher-margin vehicles to blunt the impact of tariffs, a move that Mazda CEO Masahiro Moro referred to as “intentional adjustments” aimed at maintaining profitability and staying competitive.
Smaller models like the Mazda3 and CX-30 have suffered steep sales drops, down 37% and 40% year-over-year, respectively.
SUV sales, by contrast, are climbing: the CX-70 is up 21% and the CX-90 is up 13%, while profit margins on models like the CX-5 are roughly double those of Mazda’s smaller vehicles.
Follow the money: The company estimates that U.S. tariffs on auto imports from Japan (recently reduced to 15% from 27.5%) will still cost $1.58 billion in the fiscal year ending in March.
Why it matters: Mazda is leaning heavily into SUVs to offset tariff costs, betting that higher-margin models will sustain profitability. But with sticker prices climbing and fewer entry-level options available, dealers could face pushback from price-sensitive buyers shifting to rival brands.
In July, Mazda scaled back output of smaller models( including the Mazda2 subcompact, Mazda3 compact, and CX-30 crossover), according to its latest sales and production report.
At the same time, the automaker ramped up production of the CX-50, its only U.S.-built vehicle, in an effort to maximize American-made supply.
Mazda’s Alabama plant boosted CX-50 output by 31% to 8,963 units, the company said.
OUTSMART THE CAR MARKET IN 5 MINUTES A WEEK
No-BS insights, built for car dealers. Free, fast, and trusted by 55,000+ car dealers.
Between the lines: Mazda’s pivot comes as the company raises prices across several popular models, with the best-selling CX-90 seeing some of the biggest 2026 model year hikes.
Pricing for the 3.3 Turbo Preferred trim now starts at $42,950, up from $41,145 (+$1,805).
The 3.3 Turbo Premium Sport rises to $46,980 from $46,600 (+$380).
Pricing for the base CX-90 PHEV increases from $49,945 to $50,495 (+$550).
The flagship Premium Plus PHEV starts at $58,500 for 2026, up from $57,950 (+$550).
Despite SUV momentum, Mazda’s overall deliveries in August dipped to 38,140 units—a 7.6% decline from the same month in 2024. Sales of the CX-5 fell 8.8% year-over-year, to 11,759 units compared with 12,887 last August.
Bottom line: Mazda’s shift highlights how trade policy and consumer trends are reshaping automaker strategies—where profitability is driving product decisions more than volume.
A quick word from our partner
Want insider knowledge on today’s auto retail trends?
The Haig Report® is the industry’s longest-published, most-trusted quarterly resource on dealership values. Since 2014, it has delivered insights on performance, market shifts, and franchise desirability—helping leaders spot opportunities and risks.
Each edition includes exclusive insights on valuation trends, brand outlooks, and blue sky values.
Looking to grow your portfolio or explore investments? Join our exclusive buyer and investor database at haigpartners.com/buyerdatabase.
