Mer 07 Nov 2012, 2:55 am
Suzuki Motor Corp. will pull out of the U.S. car market after almost three decades, following Saab and Isuzu among automakers making their exits after failing to earn profits in the country.
Suzuki will stop the sale of new automobiles in the U.S., though it will continue offering motorcycles, all-terrain vehicles and boat motors, the Hamamatsu, Japan-based carmaker said in a statement Tuesday. The company's U.S. distributor filed for bankruptcy protection in Santa Ana, Calif., as part of the reorganization.
The withdrawal marks the end of a business that began in 1985 and never managed to win over U.S. consumers as Toyota and Honda did. The move allows Suzuki, which has the smallest U.S. market share among Asian automakers, to focus on defending its lead in India, where the company is facing mounting competition from Hyundai.
"Suzuki is no longer among the carmakers like Toyota or Honda to have an advantageous position in the U.S., so why not focus on what it is good at?" said Satoshi Yuzaki, Tokyo-based general manager at Takagi Securities Co. "It makes sense for Suzuki to focus on India and other Asian markets."
Suzuki's sales in the U.S. will stop after its current inventory runs out, said Ei Mochizuki, a Tokyo-based spokesman.
American Suzuki Motor, the wholly owned U.S. distribution unit, agreed to begin reorganization proceedings under Chapter 11 of the U.S. Bankruptcy Code, Suzuki said. The unit had $346 million of debt and $233 million in assets as of Sept. 30, according to bankruptcy filings.
Suzuki will retain dealerships to maintain existing vehicles, Hideki Taguchi, a company spokesman in Tokyo, said Tuesday.
American Suzuki Financial Services, owed $891,000, is listed as the largest creditor without collateral backing its claim, according to court filings Monday.
Suzuki's sales in the U.S. during the first 10 months of the year fell 4.7 percent to 21,188 vehicles, giving it a market share of 0.2 percent, according to researcher Autodata Corp. By comparison, Toyota's share was 14.4 percent.
Sales of the Samurai plummeted after Consumer Reports magazine in 1988 said that the model was likely to roll over during accident-avoidance tests. Suzuki sued Consumers Union of U.S. Inc., the magazine's publisher in 1996, and settled the suit in 2004.
After its best-ever year in the U.S. in 2007, when it sold 102,000 vehicles, Suzuki dissolved its Canadian venture with GM in 2009, following the collapse of Lehman Brothers Holdings Inc. that roiled markets worldwide. Suzuki has been importing its cars from Japan since then.
- With assistance from Dawn McCarty in Wilmington, Del., Alan Ohnsman in Los Angeles and Siddharth Philip in Mumbai.
Jeu 08 Nov 2012, 11:20 am