- Lexus, Acura, Infiniti, Amati?
Today, we're going to be talking
about Mazda's secret luxury brand,
why they existed in the first place,
and what happened to the V12 luxury sports car
that never saw the light of day.
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(soft music)
During the 1980s, Japan was going through an economic boom,
which led to extreme levels of financial prosperity
among all classes in Japan.
But what exactly caused this boom?
In September of 1985, Japan, as well as France,
Germany, and the United Kingdom signed the Plaza Accord.
This accord depreciated the U.S. dollar
against the French franc, the German Deutsche Mark,
the British pound, and of course the Japanese yen.
This was drafted in hopes to increase U.S. exports,
as well as making purchasing foreign assets
easier for Japan,
as well as those other countries.
This accord,
in combination with other expansionary fiscal measures,
created a strong yen,
and an optimistic economy for Japan.
And as a result,
Japan entered the beginning stages of what was called
the Japanese asset price bubble.
From 1985 to 1991,
Japanese real estate and stock market prices were inflated.
The price of land in Japan increased an estimated 550%.
Let me give you an example.
Let's say you're in Tokyo,
and you lay a newspaper on the ground.
The surface area that the newspaper covered,
was worth $50,000.
If that doesn't mean much to you,
at a valuation of $13.47 trillion,
Japan's land was valued more than the entire United States.
The combined effects of the Plaza Accord,
with the tremendous inflation,
allowed businesses in Japan to boom.
And that included the automakers.
In the years before all this was happening in Japan,
the United States was experiencing
a different type of change.
The gas prices had gone up almost 300% in the United States
due to Saudi Arabia placing an oil embargo in 1973,
the Oil Crisis.
Even though American consumers
wanted more fuel efficient vehicles,
their domestic manufacturers
were not adjusting to the times fast enough.
Cars from the U.S. were gaining a reputation
for being cheaply produced, unreliable gas guzzlers.
By contrast Japanese brands
we're producing reliable and fuel efficient vehicles.
This turn of events was catastrophic
for American automakers,
Japanese car sales in the U.S. increased
from a rather small 6.5% market share,
to more than 20% of the U.S. market by 1980.
Japan was doing so well,
that they had to come to an agreement
with the U.S. government
to slow down their exports to the U.S.,
so that American automakers could get back on their feet.
This agreement was known as the Voluntary Export Restraint.
The Japanese companies were kicking our asses so hard,
that the Reagan administration
threatened to take the ball home,
if the Japanese didn't play with one arm
tied behind their back.
The cap was set at 1.68 million vehicles per year.
The cap was raised to 1.85 million cars in 1984,
and over 2 million in 1985.
Japan needed to find a solution to maintaining profits,
while keeping the number of cars they exported
it to a minimum.
Now armed with the financial backing
from the price asset bubble,
Japanese automakers were basically juiced up
like bodybuilders on steroids.
They could develop, manufacture, and export new cars
that were on the cutting edge of new technology,
and very fuel efficient.
And because the yen was so strong, compared to the dollar,
they could do all of this while keeping their costs down.
During this time, BMW, and Mercedes-Benz,
were sitting at the top of the luxury car market.
Japanese automakers notice that their luxury cars
could be sold at a high price,
and that high price could make up
for the low volume of cars.
So Japanese automakers got to work,
developing their own luxury brands.
Honda launched Acura, with the Legend in 1985,
and Integra in '86,
while Toyota developed and released a large sedan
called the Lexus LS 400.
Looking at those brands today,
you can see the lasting impact those first cars had.
While those cars were setting a foundation
for Lexus and Acura,
what was Mazda working on at this time?
Were they working on their jump shot?
Were they learning how to crochet?
No.
Near the end of the 1980s,
Mazda was developing a little car called the Miata.
Its development actually involved the design competition
between their offices in the U.S., and Japan.
Rear wheel drive convertible concepts came from the U.S.,
and front wheel drive mid-engine concepts came from Japan.
That's very strange.
Eventually the U.S. divisions designed one.
And when it launched, the Miata's clean design,
and suburb handling being praised by literally everyone.
It was the perfect embodiment
of what a sports car should be.
Mazda had hit the jackpot with Miata,
and it remains a fan favorite for car enthusiasts
to this day.
I still want one.
I want an NB.
The Miata's popularity had pushed Mazda's confidence
to an all-time high, and who could blame them?
They felt they were in a good enough place
to dive into their next endeavor,
which was to develop a luxury brand
like their domestic rivals, Toyota, Honda, and Nissan.
So in 1991,
Mazda announced they were creating a new luxury brand,
called Amati.
Miata, Amati?
Whoa.
What exactly did they have developed at this point?
Well, the project for Amati's first car
was codenamed Project Pegasus.
Their flagship sedan was clearly aimed at the likes
of the BMW seven series, Mercedes-Benz S-Class,
and of course the recently debuted Lexus LS 400.
And more importantly,
it was going to be a V12 powered model
called the Amati 1000.
V12 luxury sedans were not unheard of at the time,
but they were definitely rare.
BMW had debuted a new five liter V12 in their seven series
in 1987,
and Mercedes had responded with their own in 1991,
Mazda would have been just the third V12 entry
from a luxury brand.
Most of the time,
V12s or either six cylinder engines put together like this.
However Mazda's V12 would have been constructed
a bit differently to the German engines.
Mazda's early design show
that they essentially would have put three banks
of four cylinders together.
And this would have made the Amati 1000 engine,
the first application of a W12 engine.
In fact, W12 design wouldn't be used again
until VW produced one for the Audi A8 in 2001.
Mazda was in uncharted territory
for designing this in the early nineties.
Mazda had its eyes set
on becoming Japan's third big automaker,
behind Toyota and Honda.
With the MIT 1000 being on track to be a game changer
for the luxury sedan,
things were now looking very promising, for now.
During Amati's development,
tensions were rising within Mazda.
Remember how there was a design competition
between Mazda's U.S., and Japan offices
for the Miata's design?
Well, Mazda believed that because that design competition
worked for the Miata,
they should do it again with the Amati 1000.
In addition,
Mazda's lineup had expanded during this time,
and they had to shift some of its production to the U.S.
to compensate.
These two factors actually created some resentment
between the two offices.
Employees in Japan started accusing the U.S. branch
of having quality control issues within their plants,
which to their credit, were valid.
The U.S. produced cars did have build quality issues.
However, that Japan branch would begin to experience issues
of their own.
Mazda was not nearly as big a company
as the likes of Toyota and Honda.
So they didn't have as much money,
like not even close.
They couldn't afford basic things for their engineers,
like new notebooks.
Mazda producing a luxury brand and a flagship sedan,
like the Amati 1000,
meant they were punching way above their weight class.
By comparison Lexus spent $400 million
just developing the engine for the LS 400.
It was at this point where all the tension had built up to.
At the same time that Mazda's wallet was becoming thin,
Japan's economy started to take a nosedive.
Japan entered a period called the Lost Decade.
However, they would feel the effect of the bubble burst
for almost 20 years.
Not being able to afford any new projects,
the Amati project, and all of its development,
folded immediately.
The disappointment from the failed project
resulted in Mazda erasing nearly all the evidence
that the Amati brand, or the Amati 1000, even existed.
The resulting shame meant that you would be hard pressed
to find anyone outside of retired Mazda executives
who mentioned, or even acknowledged Amati,
as a legitimate project.
While Mazda had turned away from the luxury market,
their rivals began to thrive.
Lexus debuted the LS 400,
and it immediately put the Germans on notice.
It was a higher quality vehicle, with more features,
all while being less expensive.
The reason why Toyota was able to succeed
where Mazda failed,
was due to the disparity in their financial situations.
Simply put,
Toyota, had way more money to spend.
Their development started much earlier, in 1983.
And they basically threw a billion dollars at the project,
with the intent of creating the world's best car.
Lexus engineers set up shop in Laguna Beach,
to research how wealthy Americans spent their money.
And also, they thoroughly tested their prototypes
on the German autobans.
The LS 400 turned out to be so good,
that Mercedes-Benz blew their budget
developing the S class successor.
But Toyota weren't the only ones to experience success.
Honda had developed Acura.
And in 1987, Acura's first full year of sales,
they sold 109,000 cars, with a flagship Legend sedan,
accounting for 55,000 sales,
and the rest with the smaller Integra.
Acura also made an interesting hire
from what remained of Mazda.
Dick Colliver was a former employee of Mazda
since the 1970s.
And in the aftermath of the failed Amati project,
apparently he said
that he took quote, "everything to Honda.
"all the systems we developed,
'Mazda didn't do anything with them.
"They basically threw them in the dumpster,
"But I kept them in mind.
"The image programs, the database programs,
"the dealer development programs,
"the people, the processes.
"I took them with me."
Acura even started knocking titans like Ferrari off balance,
with our new NSX, which had development input
from the legendary Erickson Senna.
(car engines roars)
The NSX was so inspirational,
that Gordon Murray shifted his inspiration
for the McLaren F1, from the Porsche 911, to the NSX.
That's huge.
Even though Infinity didn't have the initial success
that Lexus and Acura experienced,
they eventually carved out their own space
in the luxury market, starting in the early 2,000s.
the three biggest Japanese automakers
were all experiencing success,
while Mazda was still just known
for creating a great budget sports car with the Miata.
Definitely not what they had in mind for their future.
It just goes to show that even if you take the time
to make sure that the car was well-designed,
with a great engine,
there are huge factors at play
when it comes to launching a car brand, like politics,
and good market timing.
Japan's economy had reached the highest of highs
leading to Japanese auto makers actually benefiting enough
to the point where they were able to make a leap forward.
Unfortunately, though, for Mazda,
they were not one of those companies.
Mazda will always be loved for making brilliant sports cars
like the Miata, the RX7, RX8, even the Mazda Speed 3.
However, we can only speculate what the company
would look like today,
if they had managed to see their luxury brand, Amati,
actually take off.
- Big announcement!
The Donut Underground has a shirt now.
A shirt,
Now if you don't already know, the Donut Underground
is our membership club for super fans.
Members get access to behind the scenes videos,
a Discord server, exclusive stickers, merch discounts,
and now there's a shirt, a fricking shirt!
It's the same color as our new stickers,
which members voted on a couple of months ago.
You get input into what we make.
The shirt is $25, and only available to underground members.
To find out how to join,
click the join button down below on this video,
or on our channel page, or for iOS users,
check out the link in the description.
We got a shiiiiiiiirt.
- If you want to know more about Amati,
checkout our Past Gas episode,
where we devote an entire episode to it,
we go a lot more in depth.
And if you're interested in Mazda's racing, heritage,
check out this episode of Up to Speed right here,
or let me know if you want to hear about the 787B,
the Mazda race car.
We actually did an episode of Past Gas on it as well.
Hit that like button, be kind.
I'll see you next time.