Mazda Bets on Flexible Assembly Line to Beat Tariffs with its Next Japan-Built EV

• The automaker will launch a new EV in 2027, with production taking place in Hofu, Japan.

• The assembly line will be able to accommodate gas, diesel, hybrid, PHEV, and electric models.

• This should help the company reduce production costs enough to remain profitable in the face of U.S. tariffs.

Despite slowing EV adoption and global economic uncertainty caused by the threat of tariffs from the United States, Mazda presses forward with its plans for a new electric vehicle to be launched in 2027.

Indeed, the Japanese automaker intends to add a new electric vehicle to its lineup, the first since the MX-30 EV was discontinued.

Even if the new EV is expected to be offered in North America, developing a new supply chain to manufacture it at Mazda and Toyota’s joint factory in Alabama wouldn’t make financial sense, according to Taketo Hironaka, managing executive officer in charge of production engineering for Mazda.

This means the upcoming EV could be subject to tariffs imposed by the American administration on vehicles manufactured outside of the United States, which could be as high as 25%.

To remain competitive and profitable even if these tariffs are put into place, Mazda bets on its “lean asset” strategy, which calls for highly flexible and technologically advanced assembly lines that could cut production costs significantly.

A key part of this plan is already in place in Hofu, Japan.

Indeed, Mazda’s Hofu H2 plant, currently producing the CX-60, CX-70, CX-80, and CX-90 large crossovers, is designed to seamlessly accommodate all current types of powertrains on the same assembly line, without requiring costly investments and long downtimes to switch from one powertrain to another.

This means that gasoline, diesel, hybrid, plug-in hybrid, and fully electric models can all be manufactured concurrently.

This is in part due to a high level of automation and the replacement of typical conveyors with automatic guided vehicles that deliver components throughout the factory.

Compared with setting up a new production line dedicated to electric models, Mazda says its approach will reduce the required investments by 85% and cut lead time by 80%.

In addition, having a flexible manufacturing facility will allow the automaker to better adjust to market demands, making it very easy to go from 0 to 100% percent EV production, or any other ratio that makes sense given global sales of each powertrain types and individual models.

Mazda wants to bring some form of electrification to its entire lineup by 2030, at which point between 25 and 40% of its global sales should come from fully-electric vehicles.

Unsurprisingly, current forecasts favour the lower end of this bracket, but Mazda will be able to react promptly if EVs suddenly gain popularity again in a few years.

Having flexible facilities and supply chains is even more important in Mazda’s case, as it is a relatively small player in terms of sales and therefore lacks the resources to have plants sit idle for months at a time when demand drops.

As a comparison, Mazda sells about 1.3 million vehicles per year globally, while Toyota sells twice that amount in the United States alone.

Few details are known about the upcoming Mazda EV, but it has been confirmed that its battery cells will be manufactured by Panasonic Energy and then assembled into packs by Mazda at a factory in Iwakuni.

Source: Automotive News