Mazda Motor Corp., in its fiscal first quarter, posted an operating loss of 23.1 billion yen ($285.3 million) in the three months ended June 30, compared to the operating profit of 6.4 billion yen ($79.0 million) in the same period last year.
Revenue dropped to 408.1 billion yen ($5.04 billion) or 30 percent. Moreover, international sales for the period slipped to 281,000 units or 11.3 percent, as the company’s factories struggled to return to normal operations after the March 11 earthquake in Japan that disrupted the country's supply chain.
Furthermore, the company’s domestic production declined 20 percent in the quarter. Kiyoshi Ozaki, the company’s chief financial officer, revealed that lost production alone cost the company 3.7 billion yen ($45.7 million) in special losses during the quarter.
He added, however, that volume has now returned to pre-quake levels. The company took another 20.0 billion yen ($247.0 million) hit in lost sales because of the earthquake.
The company’s loss comes as vehicle manufacturers in Japan enter earnings season bracing for red ink or big declines. The second vehicle manufacturer to give results, Mazda followed Nissan, which reported a smaller-than-expected 10 percent decline in operating profit to remain in the black.
The continued appreciation of the yen against the euro and the dollar is also hurting the earning of Japanese carmakers, undermining the value of overseas earnings repatriated to Japan. It also pressures Japanese vehicle manufacturers to increase overseas prices, damaging competitiveness.