Mazda5: 44% fleet sales in US

[HotRodSaint]

Sounds like everyone should stay away from used automatics! (smash)

Ok, so this was meant as a joke.

But then I started thinking...

Rental agencies don't care about sunroofs, automatic climate control and rear spoilers, so they will be buying automatic Sports.

And if rental car agencies are selling them at auction, then Carmax will be buying them.

A search of Carmax shows that out of their 18 available Mazda5's in the US, 17 of them are Sports. And this highly unscientific study also shows that Touring is priced about $1000 more than a similar mileage Sport.

This probably also means less Touring (and Grand Touring) models will be sold than Sports since consumers will also be buying Sports.

 

[rodslinger]

Supply and demand: if there's a flood of freshly used, low-mileage vehicles on the market, prices and resale value drop. This certainly could affect the Mazda5 as there aren't many vehicles sold at retail to begin with.

Yup.... My 5 was a fleet vehicle. It was a Hertz rental out of Florida. Whitewater sport with auto and rear bumper guard. Paid $13900+TTL with 14k miles on it. It was near flawless when I got it. Very happy with it so far.

 

[opus]

I don't see how fleet sales hurt resale. I don't see why it is negative. Someone will have to school me...

Rentals are usually kept by the company for 12-18 months and then sold. They usually have had the living s*(t beat out of them (Rodslinger, you are the exception to the rule!!) and there are a whole bunch of the same vehicles being dumped on the market at about the same time and are therefore sold below what the typical market resale value would be. These figures are then placed into the "average" transaction price for the vehicle and the overall resale has then "fallen".

I only bring up the resale for those who may be considering trading in for the new features that the 08 will be offering. I myself will be keeping my 06 for as long as possible, hopefully till my 13 year old twins are through college .

 

[bstad1]

Although a higher resale value would be nice, that's not why we bought the MZ5. It's not an investment. It's a tool like a computer that will be worth nothing one day. And it zooms us from place to place.

 

[rotorbaru]

Surprising to me. All the 5s I see have a dealer plate or sticker on them.

I thought projected sales were around 10,000, so midyear retail sales of 4300 doesn't sound all that bad. Having a stick-shift Sport without even a CD changer, I'm expecting basically zero resale value.

Total sales are over 7000, for combined fleet and retail, so they are already ahead of projected annual sales of 10,000.

 

[paging_drburgos]

It's a big problem for vehicles such as the prior Ford Taurus and current Chevy Impala, both of which sold a majority of vehicles to fleets.

the impala and the taurus have low resale values because they were poorly designed and they suck nuts. go (usa)

 

[paging_drburgos]

And third, 44% fleet sales of the Chrysler 300 haven't ruined it's image.

another over rated car. Have any of you seen how bland the interior is? I thought it was a cool car until i rented one. It didnt ride all that different than a malibu although the malibu's interior was somewhat impressive for such a hideous car.

 

[paging_drburgos]

Although a higher resale value would be nice, that's not why we bought the MZ5. It's not an investment. It's a tool like a computer that will be worth nothing one day. And it zooms us from place to place.

werd. resale value wasnt one of my concerns when i made the purchase. i purchased it because it fits my life needs right now and i wanted something that stands out in a crowd of oversized SUV's and camry's. im happy (mj)

 

[bulwnkl]

Supply and demand: if there's a flood of freshly used, low-mileage vehicles on the market, prices and resale value drop. This certainly could affect the Mazda5 as there aren't many vehicles sold at retail to begin with.

It's a big problem for vehicles such as the prior Ford Taurus and current Chevy Impala, both of which sold a majority of vehicles to fleets. Some of these freshly used cars show up in the newspaper ads as "Program Cars".

While I can buy this for the Fords, Chevys, etc., it doesn't apply to the Mazda given the extremely low total numbers. Also, a primary reason resale is so low for the Americans is that the selling price (to the fleets and also to consumers during the big rebate periods) is VASTLY lower than MSRP. When we buy pickups and SUVs for the fleet at work, we get a MINIMUM of $6-8,000 off MSRP for most of them, sometimes $10,000 off. Cars are less of a discount because the margin is lower, but it's still substantial. However, for a non-American brand, we can't do too much better than a very sharp consumer in most cases.

This is why I have the following rule of thumb: Only a fool buys an American car new, and only a fool buys a Honda or a Toyota used.

 

[raspykart]

This may be a good thing, good way for Mazda to get the word out there about this vehicle without having to advertise. I know everybody thats seen ours has been impressed with the overall package and value.

 

[Antonio DiMarco]

I'm not sure what mean

According to the numbers, for 2007 alone there's approximately 177,000 people out there who may disagree with you (burnout).....I however agree with you having driven my father-in-laws 2005 Camry.

I'm not sure what you mean by "for 2007 alone there's approximately 177,000 people out there who may disagree with you". I know Camry's are popular, what I'm saying is that Camry's are also part of rental fleets, so the idea that being part of a rental fleet kills resale doesn't seem accurate. (thumb)

I personally like that our 5 is unique. Although I'm seeing a lot more in the MA area, I still feel like it's a fairly exclusive car. And the numbers reflect that exclusivity.

Although I'm buying a Mazdaspeed 3, my wife isn't a "car junky", so she'll drive the 5 until things start breaking- which based on the history of my other Mazda vehicles won't be for another 130,000 to 150,000 miles.

 

[WhiteStar III]

I'm not sure what you mean by "for 2007 alone there's approximately 177,000 people out there who may disagree with you". I know Camry's are popular, what I'm saying is that Camry's are also part of rental fleets, so the idea that being part of a rental fleet kills resale doesn't seem accurate. (thumb)

You havent been reading and comprehending the posts in this thread. Fact is, despite your assertions to the contrary (and lack of evidence to support such assertions), the Mazda 5 lacks enough demand to support its limited supply. Hence 42% of the allocated U.S. supply is being dumped to rental fleets. The Toyota Camry on the other hand has strong demand and as such only a relatively small number make it to fleet users and only 4.7% of the total to rental fleets.

Now which do you think is going to suffer greater depreciation?

 

[starlightmica]

This may be a good thing, good way for Mazda to get the word out there about this vehicle without having to advertise. I know everybody thats seen ours has been impressed with the overall package and value.

Here's pushing it: a fellow on the Sienna forum recently had a 5 as a rental, and tried to go shopping with his wife and 4 kids + 4 car seats and 2 strollers. Needless to say, it wasn't the most positive review.

 

[AIMWO4]

Duh

I have a a real van for that. I still don't put down the 5. It does what it's designed to do.

Here's pushing it: a fellow on the Sienna forum recently had a 5 as a rental, and tried to go shopping with his wife and 4 kids + 4 car seats and 2 strollers. Needless to say, it wasn't the most positive review.

 

[Heat]

The thing that concerns me is that only 4,400 Mazda5s were sold at retail.

Whats wrong with the model? Missing armrests (will be fixed in 08) and poor gas mileage were my main complaints. Honestly, if it wasnt for the fact that I can get a Mazda5 in manual transmission I wouldnt even bother looking at it.

 

[Antonio DiMarco]

Not sure how your making the leap to "dumping"

You havent been reading and comprehending the posts in this thread. Fact is, despite your assertions to the contrary (and lack of evidence to support such assertions), the Mazda 5 lacks enough demand to support its limited supply. Hence 42% of the allocated U.S. supply is being dumped to rental fleets. The Toyota Camry on the other hand has strong demand and as such only a relatively small number make it to fleet users and only 4.7% of the total to rental fleets.

Now which do you think is going to suffer greater depreciation?

How do you know the 5's are "being dumped" into rentals fleets? I don't see anything in those numbers that suggest Mazda is dumping 5's into fleets. The way I read it they are being sold into fleets. You could say Toyota is dumping corollas into fleets as well with that logic. How do you know Mazda isn't choosing to advertise the 5 via rentals? The 5 isn't marketed via commercials.

Educate me because it seems like you have all the answers- plus I don't appreciate your tone.

The reality is that we really don't know what Mazda is doing. We just have a list of numbers and numbers don't tell the whole story.

 

[Antonio DiMarco]

Nothing is wrong with the model- it's a niche' car

The thing that concerns me is that only 4,400 Mazda5s were sold at retail.

Whats wrong with the model? Missing armrests (will be fixed in 08) and poor gas mileage were my main complaints. Honestly, if it wasnt for the fact that I can get a Mazda5 in manual transmission I wouldnt even bother looking at it.

With the exception of a few first year details, there is NOTHING WRONG with the 5.

Mazda knew full well that the 5 was a gamble in this market. They knew it would be an uphill battle against SUV-loving Americans. We love our cars because we can see the logic behind them- small, fun to drive and, compared to an SUV, fuel efficient.

 

[doctorz]

Whats wrong with the model? Missing armrests (will be fixed in 08) and poor gas mileage were my main complaints. Honestly, if it wasnt for the fact that I can get a Mazda5 in manual transmission I wouldnt even bother looking at it.

The missing armrests are annoying, but a minor detail. And gas mileage is about 25% better than our last minivan. For what it is, the 5 does a pretty decent job.

Mazda doesn't advertise, and none of our friends when seeing our 5 know what it is. The Mazda5 is much more at home in overseas market where they have tons of vehicles in this class. I don't think Americans (I won't speak for Canadians) know what to do with a vehicle this size. Big = better for most people, at least until gas prices continue to skyrocket.

I'm hoping that the Kia Rondo, which just doubled the market in NA and is advertised to boot, will help attract prospective buyers.

 

[WhiteStar III]

How do you know the 5's are "being dumped" into rentals fleets? I don't see anything in those numbers that suggest Mazda is dumping 5's into fleets. The way I read it they are being sold into fleets. You could say Toyota is dumping corollas into fleets as well with that logic. How do you know Mazda isn't choosing to advertise the 5 via rentals? The 5 isn't marketed via commercials.

Educate me because it seems like you have all the answers- plus I don't appreciate your tone.

The reality is that we really don't know what Mazda is doing. We just have a list of numbers and numbers don't tell the whole story.

Considering what you wrote on post #9

Mazda isn't "dumping" 5's they are using rental car companies to get people to buy them. Mazda knows a test drive isn't enough to push someone, they have to be behind the wheel for an extended period of time to really appreciate the attributes of a particular car. Part of what pushed me to buy a 3 was the experience I had driving a rental. Although I test drove a 3 three times, it was the two days I spent with the rental that pushed me over the edge.

Mazda's approach is smart and resell has nothign to do with whether a car is in a rental fleet or not.

You sure seemed to have knowledge of Mazdas marketing plan for the 5. And a lot of hating on Toyota success.

I posted this in another thread a while ago, but the info is still relevant and shows that the Mazda5 fleet numbers have increased dramatically since then.

Market Collapse
Detroit 3 count on fleet sales to move minivans


By RICK KRANZ | AUTOMOTIVE NEWS

AutoWeek | Published 01/02/07, 11:31 am et

SLUMP
Consumers are bailing out of minivans. Here are annual retail registrations.
2001: 969,342
2002: 906,036
2003: 807,059
2004: 836,868
2005: 818,823
2006: 611,191*
* First 10 months
Source: R.L. Polk

DETROIT -- Simply put, Detroit 3 minivan sales are even worse than you thought.

The Detroit 3 are relying on fleet customers -- both corporate customers and daily rental companies, such as Hertz -- to prevent a minivan sales debacle.

In the first 10 months of 2006, fleet sales accounted for about 65 percent of Ford Freestar sales, about 62 percent of Chevrolet Uplander sales and about 42 percent of Dodge Caravan and Grand Caravan sales.

By comparison, fleets accounted for 1 percent of Honda Odyssey sales in the same period. Overall, fleets accounted for about 27 percent of all minivan sales.

The estimates were generated by the Automotive News Data Center, which compared its own overall sales data to retail vehicle registrations provided by R.L. Polk. Fleet sales involve the purchase of 10 or more vehicles.

The data explain why Ford Motor Co. and General Motors are bailing out of traditional minivans. The Chrysler group, on the other hand, is defending its turf. The company has restyled and re-engineered the 2008 Dodge Caravan and Grand Caravan and Chrysler Town & County, which will debut at the Detroit auto show next week.

Meanwhile, the import brands generally have avoided a meltdown. Retail sales of the Odyssey and Toyota Sienna remain steady, although the Nissan Quest continues to struggle.

Among the imports, only the Mazda5 and Kia Sedona generate significant fleet sales. Through October, fleet customers purchased 28 percent of all Mazda5s and 17 percent of all Sedonas.

OK isn't good enough

The minivan segment is getting tougher because many retail customers are switching to crossovers to haul families and their gear. Through October, retail buyers purchased 621,594 minivans, down 12.7 percent compared with the year-ago period.

As retail demand declines, overall minivan sales could fail to top 1 million units in 2006, their worst result in 13 years.

"We are basically looking at roughly 700,000 in retail registrations this year," says Ford sales analyst George Pipas. "As the sales volume trails off, the first thing that happens is that the domestics turn to the daily rental business."

The Ford Freestar and Aerostar were "OK" vehicles, Pipas says, despite a significant Freestar re-engineering for the 2004 model year.

GM did not invest heavily to upgrade its minivans, and sales suffered.

"You just can't be OK when you are competing against Honda and Toyota," Pipas says. "The segment is getting too small to try to be an Odyssey wannabe. It will take you years to get a reputation to get up to that level. That accounted for our kind of just taking a whole different tack on this people-mover category."

Chrysler thinks the sales slide is temporary. Ann Fandozzi, director of global product markets for the Chrysler group, blames the tightening economy and the spike in gasoline price in 2006 for the minivan sales slide.

Chrysler sees overall minivan sales increasing "and stabilizing at about the 1.2 million-unit mark," she said at a press event in December.

No mommymobiles

The Detroit 3 are at an interesting crossroads for the segment.

Chrysler invested heavily in the 2008 Dodge Caravan and Grand Caravan and Chrysler Town & Country, with a conventional exterior and an innovative interior.

But sources say General Motors will phase out its traditional minivans -- the Chevrolet Uplander, Buick Terraza and Saturn Relay -- by 2010 and replace them with mid-sized crossovers. The first of these crossovers are the 2007 Saturn Outlook and GMC Acadia.

Meanwhile, Ford is producing an eight-passenger crossover for the 2009 model year. The vehicle, inspired by a recent concept called the Fairlane, will try to provide the minivan's family-hauling functions in a more stylish package. It lacks, for instance, the traditional minivan's sliding doors.

The Fairlane-inspired vehicle will be pitched to post-baby boom adults, generations X and Y, who likely spent a good portion of their childhoods scooting around in minivans and now don't want a mommymobile.

These younger adults simply aren't buying traditional minivans, says Jim Hall, vice president of AutoPacific, a consulting firm in Southfield, Mich.

He adds: "The minivan market is collapsing."

http://www.autoweek.com/apps/pbcs.dl...024/LATESTNEWS

Still want to argue the point?

 

[AIMWO4]

And I hope...

... nobody else buys a Mazda5. I like having something unique. In fact... I hope they stop selling them in the US altogether!(nana)

I bought a Town & Country for the wifey. She needs the easy access. But we all like the SuperMini (Mazda5) better. It's just not our long-distance tripmobile.

The missing armrests are annoying, but a minor detail. And gas mileage is about 25% better than our last minivan. For what it is, the 5 does a pretty decent job.

Mazda doesn't advertise, and none of our friends when seeing our 5 know what it is. The Mazda5 is much more at home in overseas market where they have tons of vehicles in this class. I don't think Americans (I won't speak for Canadians) know what to do with a vehicle this size. Big = better for most people, at least until gas prices continue to skyrocket.

I'm hoping that the Kia Rondo, which just doubled the market in NA and is advertised to boot, will help attract prospective buyers.