Mazda partner to build Mazda2 subcompact in Vietnam

Mazda Motor Corp said on Tuesday its Vietnamese partner would start assembling the Mazda2 subcompact at a new factory in central Vietnam from October, replacing imports from Japan.

Local distributor Vina Mazda Automobile Manufacturing, in which Mazda has no equity stake, will initially assemble about 2,000 Mazda2s a year at the Quang Nam province plant to serve the burgeoning Vietnamese market, Mazda said in a statement.

Mazda entered Vietnam in March by making Vina Mazda its exclusive distributor to sell the Mazda2, Mazda3, Mazda6 and CX-9 imported from Japan and the BT-50 pickup truck from Thailand.

The Saigon Times Daily reported last month that in addition to the Mazda2, called the Demio in Japan, the new factory would be designed to eventually assemble other cars and light trucks with annual output capacity of 20,000 vehicles. The vehicles would be sold in Vietnam and other Southeast Asian countries, the paper said.

A Mazda spokesman said the factory would have a maximum capacity of 10,000 vehicles a year and consider adding other models to the production lineup.

Mazda, like other Japanese automakers, is looking to reduce vehicle exports from Japan in the face of the strong yen, which makes it hard for exported cars to be competitively priced or profitable.

In June, Mazda announced plans to build a factory in Mexico to produce the Mazda2 and Mazda3 for the Americas.

Shares in Mazda were up 3.7 percent at the midday break in Tokyo, in line with a strong rise in other Japanese auto stocks.