O’Sullivan says Mazda poised for healthy growth

LOS ANGELES — Jim O’Sullivan, who helped guide Mazda‘s transition from a Ford-controlled affiliate to independent automaker, says he’s leaving the company with the right products in the right segments, and a healthy approach to selling them.

O’Sullivan, 62, CEO of Mazda North American Operations since 2003, announced last week that he will retire effective Thursday, Dec. 31. Masahiro Moro, Mazda’s global sales and marketing boss, will take over.

Through November, Mazda sold 289,889 vehicles, a 3.2 percent increase over the same period of 2014. While Mazda’s market share slipped slightly in 2015 vs. 2014 — to 1.8 percent from 1.9 percent — O’Sullivan said Mazda’s low fleet sales and tight incentive spending have him feeling good about the tiny Japanese automaker’s approach to growth.

“Overall, the primary brand has been getting healthier,” O’Sullivan told Automotive News.

While O’Sullivan conceded that lean fleet sales create a problem for Mazda dealers looking to buy for their certified used-vehicle programs, the strength of Mazda’s residual values backs up the company’s decision he said. The approach mirrors Honda’s and runs counter to Hyundai and Kia, which have more than doubled fleet sales since 2011.

“First and foremost, we want to make sure that we’re not into the heavy discounts and heavy fleet business like a lot of our competitors right now,” O’Sullivan said.

Mazda’s market share took a hit in the first half of 2015 as it phased out its subcompact Mazda2 hatchback and the Mazda5 small van. But it’s poised to reclaim that share with entries in the U.S. sweet spot, including the CX-3 subcompact crossover and a redesigned CX-9 three-row crossover, while the redesigned MX-5 Miata serves as a halo.

The result, O’Sullivan says, is a stronger brand.

O’Sullivan added: “Dealers are seeing it in throughput, they’re seeing it through their grosses and they’re seeing it through the customers that they’re attracting.”

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