Even before the ink dries on last year’s summaries, the automobile industry is preparing for the big marketing battle of 1997. The prize to the winner is the leading position in the automatic, 1600 engine volume, family car market sector, the largest market sector, accounting for 70,000 car sales last year.
The primary battle is expected between Delek Motors, the importer of Mazda, and Mitsubishi. Both companies sold the models which were last year’s market leaders, the Mitsubishi Super Lancer and the Mazda 323. What the two have in common, is that neither car is manufactured any more. The end of the marketing of these cars in Israel, in a matter of months, will force both companies to find suitable alternatives.
The opening shot was fired last week by Delek Motors, which announced it will begin to import the Mazda Lantis 1600, in addition to the 1.8 liter engine volume model. From a marketing perspective, this step is unusual from a variety of perspectives.
The 1.6 liter model has been sold until now only in East Asia and Australia, and was standardized to European requirements essentially only for the Israeli market. It should be noted that the cost of this standardization, including upgrades to the car itself, amounts to about $250,000.
In addition, this model could compete directly not only with other companies’ models, but with Mazda’s own leading model, the Lantis 1.8 liter model. The risk of "marketing cannibalism" has led the company to walk a thin tightrope in the pricing category.
The Mazda Lantis 1.6 liter model’s price tag will be NIS 81,900. The 1.8 liter model’s price tag will be NIS 88,900. It is not a large difference, but it has been proven in the past, that where Israeli customers’ price attitudes are concerned, it is a significant difference.
The NIS 80,000 region price tag is where, statistically, the largest portion of sales in Israel are made. NIS 90,000 or so, is already the upper edge of the market.
The big question is if Mazda’s marketing measures will only succeed in retaining the 323’s market share, or if they will also expand Mazda’s market share at the expense of the competitors. Delek Motors certainly hopes that the lack of last year’s market leader, the Mitsubishi Lancer which sold 9000 units, will create a gap, and Mazda will fill it.
The company is launching a huge advertising campaign on television and in the print media, which will continue through the end of March.
Mitsubishi plan to launch the Mitsubishi Charisma in the Israeli market by summer, however, theoretically, this is not an alternative to the Lancer. The Charisma is a larger car, and in Europe is positioned in a higher market sector, above the new Lancer.
These figures should theoretically create a price problem for Mitsubishi in Israel. However, Colmobile has exhibited unusual marketing survival skills in the past. Therefore, it won’t be surprising of Charisma 1.6 liter models appear here soon at prices similar to the Mazda price.
It appears new models may also enjoy the marketing vacuum created by the lack of the two market leaders in 1997. Among those models are the Fiat Marea and the Daewoo Espero, which was recently unveiled in Korea at a low price.