Japan’s Mazda should sell some assets image

Mazda Motor Corporation is the only automaker in the world that besides the automotive business own control of a team in the league and also has a professional soccer club, a hospital and more than $5 billion in land.

However, it now faces its biggest annual loss in 11 years after having posted record profits just four years ago.

Investors have reason to be concerned. Though all of the nation’s major carmakers saw their shares drop last year following natural disasters in Japan and Thailand, Mazda’s 42 percent fall was the steepest because of its vulnerability to the yen.

There are compelling reasons for Mazda to unload assets, which include $5 billion in land holdings and a hospital in Hiroshima, where the company is based.

In addition Mazda is among the few automakers in the world with no capital alliances at a time when many in the industry are tying up to share the rising burden of research and development as governments tighten environmental and safety regulations.

Despite the yen’s recent retreat from record highs against the dollar it remains at a level that is driving Japanese automakers to shift production outside their home base and to North America in particular.

With the “yen (at) 82 from 76 … I don’t call it a retreat; it is still a huge headwind for all the Japanese exporters,” Carlos Ghosn, Renault-Nissan Alliance’s chief executive, told a press briefing at the 2012 New York International Auto Show.

Mazda said in a regulatory filing it needs about 35 billion yen for factories in Mexico and Russia as it aims to raise the ratio of vehicles built outside Japan to 50 percent by 2016.

The company’s reliance on the yen may decline starting next fiscal year, when a factory in Mexico is scheduled to begin production.

The carmaker last month sold about $1.8 billion in new shares to replenish its depleted capital.