Mazda rededicates to EVs, will spend $10.6 billion on electrification

Japan’s Mazda unveils $11B spending plan for electrification

Japan’s Mazda Motor Corp unveiled a US$10.6 billion spending plan for electrification. It is also considering investing in battery production. Also, the company raises its sales target for EVs of up to 40 percent of its total global sales by 2030.

Mazda rededicates to EVs, will spend $10.6 billion on electrification
Image credits-

Automakers worldwide spend billions of dollars to ramp up EV production and battery-making as tougher environmental regulations are rising. The investment plan by Mazda follows similar announcements this year by domestic rivals such as Toyota and Honda, which have been criticized by environmentalists and green activist investors for being slow in electrification. “We will promote the full-fledged launch of battery EVs and consider investing in battery production. We estimate Mazda‘s EV ratio in global sales to rise to a range between 25% and 40% as of 2030,” Mazda said in a statement. Its previous EV sales target was 25 percent by 2030.

The new forecast was in line with a broader industry trend, with consulting firm Deloitte expecting EV sales to make up about 32 percent of total new car sales globally by 2030. As part of a three-phase plan, Mazda said it would introduce battery-EV models in the “latter half of phase 2” which it identified as the period between 2025 and 2027. It planned a full-scale launch of fully electric vehicles between 2028 and 2030, the company said. Senior managing executive officer Akira Koga told reporters the 1.5 trillion yen ($10.6 billion) investment would be made along with its partners and would be used for research and development. The news was first reported by the Nikkei business daily.

Agreements and joint ventures

Koga declined to give a detailed investment timeline, adding it would depend on how fast EVs became popular. Still, Mazda CEO Akira Marumoto said the company will seek to introduce a new hybrid system and improve the efficiency of the internal combustion engines. “We believe that a multi-solution approach will be effective,” he said. The automaker said it had agreed to work with seven companies, including electric-component maker Rohm Co, to jointly develop and produce electric drive units. Company executives also said Mazda had reached a supply agreement with battery maker Envision AESC for a limited period between 2025 and 2027. “Beyond that, we would like to develop a strategy on procurement and securing (batteries) step by step,” said Koga.

Envision AESC chief executive Shoichi Matsumoto told Reuters last month his company was in talks with automakers in Japan, Europe, the United States, and China for new supply deals. Mazda is aiming for about 4.5 trillion yen in net sales for the business year ending March 2026, a jump of about 45 percent from the financial year ending March 2022, the company said.