TOKYO — Mazda Motor Corp. helped to pioneer the concept of ultra-efficient lean manufacturing. Now, the company is floating something new — the Lean Asset Strategy.

CEO Masahiro Moro outlined the automaker’s new strategy as its secret weapon in staying profitable and competitive in an era of unprecedented industry change and uncertainty.

Pitching the idea at a news conference on March 18, Moro and other top executives said it would save the company billions of dollars through 2030 and help it slash investment, manpower and lead time for Mazda’s first line of in-house electric vehicles due in 2027.

The development and production innovations will even make Mazda’s coming EVs cost competitive with the Chinese brands now challenging international players, executives said.

By marshalling new digital tools, whole-vehicle modeling, artificial intelligence and an expanded network of partners, Mazda says it has simplified engineering and manufacturing. The result is a small-sized company that is still capable of churning out a wide array of vehicles and powertrains.

Sign up to start your week with the top stories from the prior week, delivered to your inbox first thing each Sunday morning.

Mazda says it can now do triple the development work with the same amount of resources.

“As a small player in the industry, Mazda is pursuing a lean asset strategy to minimize business risk and increase business competitiveness,” Moro said. “We will achieve sustainable growth through low investment, high asset efficiency and competitive technologies and products.”

Lean Asset Strategy to deliver huge savings

Hiroshima-based Mazda has always done more with less.

But today’s crucible of electrification, software, low-cost competition from China — and now, the sudden onslaught of looming U.S. tariffs — are putting that drive to survive to the test.

Mazda’s annual R&D spending is about one-tenth the huge outlay of Toyota Motor Corp.

But Mazda, which sells just 1.3 million vehicles a year worldwide, has a diverse lineup covering everything from the MX-5 Miata sporty coupe to the CX-90 large crossover and a range of technologies that includes diesel and gasoline engines and plug-in and mild hybrids. More is coming thanks to “lean asset” innovations, including new rotary, full-hybrid and EV systems.

“Responding to the diversity of engines and electrification is a challenge at our scale,” Chief Technology Officer Ichiro Hirose said. “But we have increased development efficiency threefold.”

The Lean Asset Strategy will trim some ¥500 billion ($3.36 billion) off the company’s planned investment in electrification through the end of the decade, Mazda said.

Mazda said in 2022 it would spend ¥1.5 trillion ($10.08 billion) in electrification through 2030. It forecast the amount to expand to ¥2.0 trillion ($13.44 billion) because of inflation. But innovations in cost, development and production should keep the outlays steady at ¥1.5 trillion.

For the EV Mazda plans to introduce in 2027, the company’s first in-house dedicated full electric, the company thinks it can cut development investment 40 percent and halve the amount of work hours in development, compared with its previous way of approaching development.

Moreover, by leveraging flexible manufacturing at its assembly plants, Mazda plans to assemble the EVs in mixed production with other vehicles. This will reduce the initial capital investment 85 percent and the lead time for preparing for mass production by 80 percent, Mazda says.

Mazda embarks on big product expansion in 2025

The shift will also improve Mazda’s resilience against tariffs being threatened against vehicles shipped to the U.S. from places such as Japan and Mexico, where Mazda has factories, said Taketo Hironaka, managing executive officer in charge of production engineering.

“What we must do on the production side is work with suppliers on lowering our production costs,” Hironaka said. “This strategy will definitely work, but I can’t say by how much at this point.”

Additionally, the Lean Asset Strategy will cut the cost of making Mazda EVs to levels competitive with the Chinese automakers now entering the global market, executives said.

“We will improve and evolve the foundations of various technologies to be competitive with Chinese players,” said Ryuichi Umeshita, managing executive officer in charge of electrification.

Mazda began developing its Lean Asset Strategy in 2015, and the first fruits were realized in recently introduced products such as the CX-70 and CX-90 large-platform crossovers.

Bigger savings will be achieved, however, as Mazda rolls out a major product shift in the 2025-2027 timeframe, a period Moro calls Phase 2 of his roadmap to the end of the decade.

New technologies in the works for Phase 2:

- Mazda’s first dedicated electric vehicle platform

- The company’s first independently developed strong hybrid system

- A new, hyper efficient internal combustion engine called Skyactiv Z

- The redesigned CX-5 crossover, the brand’s global best-seller

In battery investment, Mazda thinks the new approach can halve its outlays, from the ¥750 billion ($5.04 billion) it had expected to spend through 2030. That battery spending will support the 400,000 EVs Mazda plans to be selling that year, for about a quarter of its global volume.

The 2.5-liter, four-cylinder Skyactiv Z engine will arrive in the CX-5 crossover, the company’s global best-seller, in 2027. It will form the backbone of Mazda’s internal combustion and hybrid products after that, with its technology applied to future inline 6-cylinder and rotary engines.

That will set the stage for further technological breakthroughs in Phase 3, from 2028-2030. Those could include a next-generation lithium ion battery being developed in-house and a revamped, two-rotor rotary engine designed with more power for American drivers.

Mazda also wants to leverage its new EV platform as an architecture for next-gen plug-in hybrids. It will then expand its proprietary strong hybrid system to its lineup of large products.

“As time passes,” Moro promised, “the benefits will show up in a bigger and bigger way.”