Mazda Rewarded For Making Awesome Cars With 60% Profit Surge

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1st Gear: Ok, Maybe Currency Plays A Role


The net income at Mazda jumped by 60% to $198.5 million this last quarter, great news for everyone who loves the fantastic (or at least above par) cars they've introduced this year.

Much of this you can credit to an increase in sales and more profitable new models.

The rest of the credit, though, goes to currency valuations in the yen that have benefited exporters like Mazda and to the fact that Mazda wasn't exactly printing greenbacks last year.

As Automotive News explains:

In the latest half year, Mazda's average transaction rate was 88 yen to the dollar, vs. 79 yen to the dollar a year earlier. In other words, for every dollar received from sales, Mazda this term booked 88 yen in revenue, vs. just 79 yen a year earlier.


However irrational it is, we'd like to credit the Mazda MX-5 with this success.


2nd Gear: Tesla's Biggest Stock Woe Is Overvaluation


Tesla's stock, like a SpaceX rocket, went up-up-up-up and only now is it starting to come back to earth. Gravity, it's hard to fight.

All of this is detailed in a thorough Bloomberg report, which points out that they've actually lost more market capitalization (the stock-based valuation of a company) in October than their entire market valuation of the start of the year ($4.1 billion versus $4 billion).


Why isn't this bad? Anyone who isn't an insane Tesla fanbot seems to agree that, while the company has been successful this year, a valuation that's 262 times its earnings isn't great. It's not just the Tesla fire, it's a general realization that, while faith in Tesla wasn't misplaced, there is a downside to being so bearish you setup the company for failure.


And it's not just the financial media and analysts and hater car blogs who think this:

Musk, Tesla's outspoken 42-year-old co-founder and biggest investor, may have also played a role in the stock's October decline. After trading barbs with investors who have shorted Tesla shares this year in the belief the stock is overvalued, Musk appeared to acknowledge as much in interviews last month.

"The stock price that we have is more than we have any right to deserve," Musk told Bloomberg Television in London last month. "It's difficult to predict where it goes in the short to medium term, but I do feel good about having the company achieve that value and more in the long term."


Couldn't have said it better myself.

3rd Gear: Daimler Ain't Care, Though


Daimler doesn't care about Tesla's stock price, so much as they're just desperate to work more with the American automaker (well, i'm sure they wished the company was cheap enough to buy outright).

"I told my guys, go back to Tesla and look for other opportunities" to work together, Bodo Uebber, Daimler's chief financial officer, told reporters in a press briefing. "We want to look for more cooperation."


The B-Class EV and Smart Fortwo, like the RAV4 EV, use Tesla motors and batteries. It's also well known that the Model S uses parts from Mercedes.

4th Gear: Chrysler Had A Good October


Chrysler sales up 11% in October, compared to about total U.S. industrywide sales up 13%. This is their 43rd consecutive month of year-over-year sales.

Every brand but Fiat was up, and Fiat was only down 1%.

Analysts told the Freep that the government shutdown probably contributed to lower sales in the first half of the month but that they rebounded towards the end.


5th Gear: Nissan Off Balance


While most Japanese automakers seem to be riding the wave of Abenomics, no such luck for Nissan reports the AP.

While profits for the July-September quarter were up 2% to $1.1 billion, that's not great compared to where they should be.

Nissan President and Chief Executive Carlos Ghosn attributed the weaker than expected performance to a variety of troubles, chief among them weakness in many emerging markets and painfully expensive recalls.


That's a rough go.

Reverse: A Dam Fine Day It Was

On this day in 1930, President Herbert Hoover turns a telegraphic "golden key" in the White House to mark the opening of the 5,160-foot-long Detroit-Windsor Tunnel between the U.S. city of Detroit, Michigan, and the Canadian city of Windsor, Ontario. The tunnel opened to regular traffic on November 3. The first passenger car it carried was a 1929 Studebaker.



Neutral: Any Automaker More Enthusiast-Focused Than Mazda? Maybe Porsche?

Photo Credit: Getty Images

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