2014 Mazda3 caught in pricing war between Toyota Corolla and Honda Civic

Article by Christian Andrei, on March 19, 2014

When Mazda started selling the 2014 Mazda3 last fall, the compact received awards as the driving enthusiast's choice in the segment. It sales, however, has been dropping every month since August 2013. In fact, the Mazda3 posted a 27-percent dive in sales in the first two months of 2014.

Since the Mazda3 is being sold using Mazda’s near-premium pricing strategy, it has fallen prey to the ongoing price war between its two main rivals -- Toyota Corolla and Honda Civic. While Mazda has been limiting incentives to maximize transaction prices and profits, Toyota and Honda are shoring up theirs.

According to Dennis Bulgarelli, director of the automotive practice at Millward Brown Digital, the Mazda3 has ended up as collateral damage in the Corolla-Civic battle. The 2014 Mazda3 went on sale around the same time as the 2014 Corolla.

While the Mazda3 attracted higher online shopping traffic from consumers nearing a purchase decision, many of them decided to buy the Corolla instead, Bulgarelli disclosed, citing Millward Brown data. He noted that while rivals hiked incentive spending on their compact offerings, Mazda curtailed Mazda3’s.

Mazda3 incentives reached over $2,700 per unit during the 2013 model's sell-down last summer. They were reduced to $1,233 in January 2014. "In that segment, unless you've got some compelling reason to be considered over a Honda and Toyota, you're probably going to lose that battle," Bulgarelli said.

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