300-HP, AWD Mazdaspeed3 Shelved, But for Good Reason?

Mazda has canceled plans for a high-power Mazdaspeed3 Evolution, fearing the beginnings of a performance arms race, Motor Trend has learned. According to the automaker, outfitting the new Speed3 with 300 hp and all-wheel drive would have set its price point and competitive set beyond the hatchback's demographic.

The impetus behind Mazda's decision? The third-generation RX-7. The brilliant coupe arrived on our shores as a 1993 model. It was a thoroughbred sports car, with 252-hp from its twin-turbo 1.3L rotary, a track-ready suspension, and a limited-slip differential. The package was so impressive, we dubbed it "Import Car of the Year." Problem was that RX-7 was $30,000. Sales dropped off a cliff, and it left our shores after the 1995 model year.

Mazda reportedly had the parts ready for a higher spec Speed3 -- the hatchback's transmission is the same unit found in the departed Mazdaspeed6, and all-wheel drive is reportedly easily adaptable. But, by opting against it, the automaker hopes to have avoided the slippery slope that claimed the RX-7. To a certain extent, it's an issue Mitsubishi and Subaru have also faced with the Lancer Evo and WRX STI.

Besides, with 263-hp and 280 lb-ft of torque, the Mazdaspeed3 trounces its competitive set on output. But behind the wheel? As we mentioned in our First Test of the 2010 Mazdaspeed3, a comparison is too hard to ignore...

What do you think, is this a smart move by Mazda, or would a low-volume, higher spec Speed3 work?