Production has begun at a new plant in Huntsville, Alabama, which was built with Toyota Motor at a cost of roughly US$2.3 billion.
As the coronavirus pandemic and chip shortages slowed the auto industry last year, Mazda kept up momentum in the US by prioritising deliveries of popular sport utility vehicles there. The Huntsville plant will make the CX-50 SUV for the North American market.
Last year marked the second straight year that US sales rose, up 19% to 332,756 vehicles, Mazda reported Friday – the most since the company began releasing the totals in 2004.
The gain comes off the previous year’s low base, when sales dropped as the automaker responded to environmental regulations.
“The production of the CX-50 here signifies the importance of the North American market to Mazda and our commitment to investing in the US,” Jeff Guyton, CEO of Mazda North American Operations, said Wednesday.
The CX-50 is Mazda’s latest SUV. The CX-5 and the CX-30 helped drive US sales growth in 2021.
The Huntsville plant has an annual production capacity of 150,000 vehicles each for Mazda and Toyota. The first car to roll off the factory’s assembly lines was the Toyota Corolla Cross SUV in September.
Mazda, Japan’s fifth-largest automaker by global sales, began US auto production in 1987 at its own plant in Michigan. In 1992, the company entered into a joint venture with Ford, but after years of declining factory use, Mazda’s US production ended in 2012.
Two years later, the company set up a plant in Mexico for US exports.
After tariff rules became stricter under the US-Mexico-Canada Agreement, which replaced Nafta and went into effect in 2020, Mazda started to rethink its North American production network.
Growth in the US ran counter to Mazda’s struggles in China and Japan. Sales in China fell 14% to 183,953 vehicles, while domestic sales dropped 11% to 157,261 vehicles, the lowest mark going back to 1970.
The declines owe in part to Mazda’s decision to prioritise the US market.
Worldwide, Mazda’s sales rose 4% in 2021 to around 1.29 million vehicles, the first increase in three years. Despite the growth, global volume remains about 10% below the pre-pandemic level of 2019.