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Mazda Sells Over 70,000 Vehicles in China in First Half of Calendar Year 2005

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HIROSHIMA, Japan--For the first time ever, Mazda Motor Corporation has exceeded 70,000 unit sales in China over a six-month period, with 70,357 Mazda vehicles retailed during January-June 2005. This reflects an increase in sales of 53.6 percent over the same period last year, showing Mazda is clearly on track to attain its goal of selling 100,000 units in the Chinese market during the 2005 calendar year.

In the first half of 2005, sales of the Mazda6 sedan were up 85.5 percent compared to last year, at a volume of 31,282 units. Also during the period January through June, Mazda 323 sales climbed 40.1 percent over the prior year to 31,902 units, while Premacy minivan sales rose 23.1 percent to 7,114 units. All locally produced Mazda models showed brisk sales, substantially exceeding the results achieved during 2004.

Mazda has introduced two models to the Chinese market with partner FAW Haima Automobile, an FAW Group subsidiary. Premacy, manufactured by FAW Haima in Haikou, Hainan Province, was launched in May 2001, followed by the Mazda 323 sedan in July 2002. Additionally, the Mazda6 sedan, built by the FAW Car Co. in Changchun, Jilin Province, was introduced in April 2003.

The RX-8 sports car, imported from Japan, has been on sale from July 2005 and has been well received. Mazda also plans to manufacture the Mazda6 5-door hatchback and Mazda6 wagon in China, to be launched in the near future.

In January 2005, the Chinese government granted approval to Mazda, the Changan Automotive Group and the Ford Motor Company to build a joint venture assembly plant in Nanjing. In May 2005, approval was also given for the Changan Ford Mazda Engine Company project, a joint venture engine assembly facility designed to accommodate future expansion plans and increases in local production content requirements.

In the area of sales, the jointly established FAW Mazda Motor Sales Company (FMSC) started operations on March 1, 2005. In the future, FMSC will distribute all Mazda-branded vehicles in the Chinese market. With the establishment of its local production system and sales network, Mazda has set a mid-term goal of 300,000 unit sales in 2010.

Kiyoshi Ozaki, director and senior executive officer of Mazda’s China Business Division, said, “I am quite pleased to see that Mazda sold over 70,000 units in the first half of this year. I believe it shows that our Chinese customers recognize the true value and attractiveness of Mazda products. We will continue to place our customer’s needs first. However, due to an adjustment in production anticipated from a minor model change as well as parts supply pressures, we are forecasting moderate growth in the second half of 2005. Still, in order to achieve our mid-term goals for growth in the Chinese market, we are working tirelessly to enhance our production system and strengthen our sales system. Together with our valued business partners in China, we want to provide products and service that delight our customers.”

In response to the rapid growth in its China business, Mazda has expanded its production and sales systems. The Mazda Motor (Shanghai) Business Management and Consulting Company--known as Mazda China Operations (MCO)--was established on June 1, 2005 as Mazda’s headquarters in China. Located in the Pudong financial district of Shanghai, MCO is considered integral to the success of Mazda’s objectives in China and will coordinate all aspects of its business in that key market.