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Mazda Demio Launch Signifies Big Win for Japanese Government

On May 30, Mazda launched an upgrade to the Mazda Demio (the Demio is known as the zippy Mazda 2 in overseas markets).  The upgrade features sportier look with the addition of a rear spoiler, however, the real news is the enhanced fuel efficiency.

Mazda Demio

New Mazda Demio (Mazda 2) 2012

In Japan, Japanese car makers have a real incentive to increase fuel efficiency, and not just because of the reduced petrol cost for consumers. Consumers in Japan benefit from a substantial tax break when purchasing a fuel efficient car. The fuel reduction of 0.4km/L (20.6km/L according to Japan’s JC08 mode test cycle) means a 50% reduction to two out of the three taxes that a Japanese consumer pays when purchasing a car.

Whilst the Japanese government loses out on significant tax income, the increased sales of the Mazda Demio in Japan means more income to Mazda which in turn translates into income tax to the Japanese Government. The Japanese also benefit on the international stage in implementing a policy which provides a monetary incentive to big business and consumers to reduce carbon emissions. As it is, Japan has one of the highest annual carbon emissions from transportation worldwide.

The release of the Demio represents benefits on all levels. It is a win for consumers who pay less tax for a more fuel efficient car. For Mazda, who should benefit from increased revenues due to increased sales. The Japanese Government who will receive the flow on tax benefits from increased Mazda revenue. Lastly, but certainly not least, the environment – better fuel economy reduces the carbon footprint.

A lot of the time, news like this doesn’t get much publicity and it’s a shame! This type of release provides real benefits on many levels and it should be recognized for this.

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