Slide Show >>When Mazda launched the MX5 Miata in 1989, it was the first of a new breed of fun-to-drive roadsters. Echoing earlier two-seat sports cars, such as the MG Midget and the Alfa Romeo Spider, the Miata's simple design and low cost brought such spirited roadsters to the masses. The Miata has also helped Mazda's bottom line: The 2005 Guinness Book of Records ranks the Miata as the most successful two-seat sports car of all time with nearly 750,000 sold to date.
The popularity of Mazda's sports car has not gone unnoticed by its competitors. Companies from Audi and Alfa Romeo to Porsche and Pontiac have now all brought out affordable, lightweight roadsters, and some have improved on the Miata's two-seater concept. The Audi TT's geometric design and use of aluminum has raised the bar for all two-seat roadsters. And the Mercedes-Benz SLK was the first sports car to offer a retractable hardtop in 1997, combining the practicality of a coupe with the fun of a convertible.
Now Mazda is fighting back. At the London auto show on July 18, the Japanese carmaker, of which Ford Motor (F) owns a controlling 33% stake, unveiled its newest model, a hardtop convertible Miata that will be sold alongside a soft-top and a coupe. This new 2006 version marks Mazda's first foray into retractable-roof sports cars, making it the only car manufacturer to offer a hard- and soft-top roadster. The Miata's retractable roof also doesn't take away from the sports car's trunk space—it folds away behind the seats. Some industry observers believe such versatility will help to attract customers who may not have considered buying a Miata. "It was a strategic and defensive move on the part of Mazda," says Vignesh Waran, an analyst with the research firm Frost & Sullivan.
CLASH OF CONVERTIBLES. Overall, however, Mazda is in relatively good shape. At the end of July, the company reported that operating profits increased 29.7% to $256.9 million. Net profits rose to $57.4 million from $3.6 million a year earlier.
The introduction of a retractable roof comes at an important time for Mazda. Over the last 15 years, competitors have gradually chipped away at the company's position: 90,000 Miatas were produced in 1990, but this number has now dropped to 53,000. These falling numbers are in part due to the Miata's aging design: It hasn't had a significant revamp since its launch in 1989. Analysts also say increased competition has played a role. "More competitors will continue to come into the market and will make life harder for Mazda," says Philipp Rosengarten, analyst for automotive researcher Global Insight.
So far, Mazda has seen off its competitors: The Japanese carmaker posted a net income of $57 million in the April-to-June quarter. Bolstered by strong Miata sales in the U.S. and Europe, sales also grew 9.5% to $6.44 billion.
FROM PIONEER TO PILE-UP. Increased competition has come from both premium and mass-market rivals. Pontiac's newly released Solstice is a no-frills alternative to the Miata—the base model doesn't come with air conditioning or anti-lock brakes—that is hard to beat for its bang-for-your-buck driving experience. Similarly, Audi's second-generation TT, unveiled in April, is a hot up-market competitor to Mazda's roadster that offers German engineering, Audi's benchmark interior design, and great styling. The Miata straddles both these segments, and analysts believe the new hardtop model will help reassert Mazda's market position.
The proliferation of new models means greater choice for anyone looking to buy a two-seat roadster. At the lower end, Saturn's Sky—Saturn is a division of General Motors (GM)—will give you change from $25,000, while in the premium category you'll be hard pressed to buy a Porsche Boxster for less than $45,000. Mazda got the ball rolling with the Miata. According to Global Insight's Rosengarten, its simple design, driveability, and, above all, low cost helped the Miata reinvent the two-seat roadster. But Mazda's pioneering concept created a pile-up in the sector. Says Rosengarten, "When you're first to the market, other companies will quickly follow."
To see more of the Miata and other two-seaters, click here.