Squeezing the accelerator on the Mazda MX-5 Miata as it exits a curve on a twisty back road in Michigan, you can’t help but smile. In the rearview mirror you can see a whoosh of dead leaves rising in your wake, dancing to the hum of the exhaust coming from the car’s high-revving, four-cylinder engine. Mazda’s $25,000, 155 HP roadster is not the most powerful car on the planet—far from it. But with the top down and the sun warming your neck on an unseasonably mild December day, you just want to keep driving forever. It’s that much fun.
Mercedes-Benz, Cadillac, Volvo—not to mention Google, Tesla and, rumour has it, Apple—are all racing to relieve drivers of that fun. Within five years, most automakers say, they’ll offer highly automated cars that can handle stop-and-go traffic and freeway speeds without any driver input. In ten years drivers will be able to work or even take a nap during their commute. Volvo just unveiled the Time Machine, a futuristic cockpit with a 25-inch flat-screen that rotates out of the dashboard as the steering wheel retreats and the driver reclines. Google is developing self-driving cars that don’t even come with a steering wheel or gas pedal.
This is the future, asserts Tesla Chief Executive Elon Musk. “Any cars that are being made that don’t have full autonomy will have negative value,” he predicted in a November conference call with Wall Street analysts. “It will be like owning a horse. You’re really owning it for sentimental reasons.”
Not everyone thinks so. “It’s not just getting from point A to point B,” says Mazda’s soft-spoken CEO, Masamichi Kogai, who heads up perhaps the only major automaker that is not working on autonomous cars. “Our mission is to provide the essence of driving pleasure.
“The car for me is like being home,” he continues. “As soon as I get inside the car, no one outside can bother me. I might go to a lake or to the mountains. I don’t know where I am going until I get there.”
Kogai has a very clear road map, however, when it comes to leading the once struggling Mazda into the future. The company tried keeping up with larger Japanese rivals like Toyota and Nissan and nearly wound up bankrupt, losing billions in the mid-1990s. Ford Motor, which had owned a small stake in Mazda since 1979, soon became its largest shareholder, effectively controlling the company with a 33 percent stake. But by 2008, in the throes of the financial crisis, Ford slashed its stake to 14 percent, then dumped the rest starting in 2010. Cast off in a sea of red ink, Mazda went into a tailspin, losing nearly $3 billion from 2009 to 2012.
Mazda was forced to rethink every aspect of its business, from the way its cars are designed and engineered to the way they are assembled. Kogai was in the thick of it, first as head of manufacturing, then as chief executive since 2013. He overhauled Mazda’s manufacturing footprint, ending production in Michigan while opening a new plant in lower-cost Mexico and setting up joint manufacturing ventures in Russia and Vietnam.
Cost-cutting alone wouldn’t solve Mazda’s problems. It had to figure out how to be as agile as its cars.
Instead of designing cars one at a time and leaving it up to the manufacturing team to figure out how to produce them, Mazda pulled everyone together—designers, engineers, suppliers, purchasing staff and production experts—and began plotting its entire lineup five to ten years out.
(This story appears in the 19 February, 2016 issue of Forbes India. To visit our Archives, click here.)