Mazda is seeking billions in loans as it deals with the damage caused by the coronavirus outbreak.
Over the past few weeks we have reported regularly on the financial difficulties faced by automakers due directly to the current pandemic. One company we hadn’t heard much about or from was Mazda. Until now.
This weekend came reports to the effect that the Japanese automaker has requested massive loans totalling about 300 billion Yen (or $2.8 billion USD) from three large Japanese banks and other lenders to help it stay afloat during the pandemic. The news was first reported by Japanese business daily Nikkei, which cited an inside source.
The banks - Mitsubishi UFJ Financial Group, Sumitomo Mitsui Financial Group et Mizuho Financial Group – as well as Sumitomo Mitsui Trust Holdings, Japan’s national development bank, are nearing an agreement on a loan package. The source said some of the loans had already been provided.
None of the three banks were willing to make any public statements regarding the loan request. Mazda itself stayed just as mum.
The Japanese automaker, like most other companies in the domain, has been forced to bring production in its factories around the world to a virtual standstill in recent months as governments wrestled with the coronavirus outbreak.
But even before the present crisis, Mazda and fellow Japanese automaker Nissan were already struggling with declining sales. The company was carrying 650 million Yen in debt, which is substantially more than its current liquidity, according to Nikkei.
On Thursday Mazda is scheduled to announce its financial results for the fiscal year ended at the end of March.