Suzuki Decides To Exit U.S Market


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Japan-based Suzuki said Tuesday that it was closing its American auto distributor and exiting the U.S. car market.

The company's U.S. arm, American Suzuki Motor Corp., will file for Chapter 11 bankruptcy protection in California. The company said it would wind down auto sales, but did not provide a timetable.

American Suzuki said it would honor all warranties, and indicated that parts and service should continue uninterrupted.

The automaker was facing multiple challenges in the United States, including unfavorable exchange rates and a small lineup of models. The company, which managed to capture only a tiny sliver of the U.S. market, also cited slow sales as a reason for the exit.

"While the decision to discontinue new automobile sales in the U.S. was difficult to make, today's actions were inevitable under these circumstances," the company said.

The brand is perhaps best known for its Sidekick SUV, a pioneering design later followed by other automakers. American Suzuki is $346 million in debt, $173 million of which is owed to the parent company. The distributor has between 500 and 1,000 creditors, according to court documents.

American Suzuki said it plans to emerge from bankruptcy as a company focused on selling ATVs, motorcycles and outboard marine engines. The company said it remains "firmly committed" to those product lines.

"These divisions are competitively positioned in their respective markets, allowing for long-term growth as economic conditions improve," the company said.

American Suzuki -- based in Brea, Calif. -- had 365 employees as of last count.

Suzuki to stop U.S. auto sales, exit market - Nov. 5, 2012
 
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Suzuki has to take out $45M loan just to shutter US dealers

Bloomberg reports American Suzuki is set to borrow up to $45 million to to close its automotive dealerships and freshen up its it motorcycle and marine business. Suzuki Motor Corporation will loan American Suzuki the funds at three percent below the London Interbank offered rate in order to offer dealer owners a cash payment in exchange for voluntarily abandoning franchise agreements. The company's 216 dealers have 10 days to make a decision on the matter. Under the plan, Suzuki would give dealer owners half of what they're owed in one lump sum, and the dealers would then be able to pursue the remaining debt through the company's bankruptcy procedure.

U.S. Bankruptcy Judge Scott C. Clarkson granted American Suzuki interim authority to borrow the funds, but Bloomberg reports the company will likely return to court in a few weeks to seek up to $100 million. According to Richard Pachulski, a lawyer for Suzuki America, the automaker may owe its dealers somewhere around $50 million.

Suzuki has to take out $45M loan just to shutter US dealers
 
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Well this had to happen someday as i hardly see any Suzuki cars here. It's like 1 in 1000 cars, i think they should come up with some new models and strategy.

BTW: I saw a Suzuki kizashi AWD the other day while coming back from office. I never knew that they come in AWD as well.
 
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Suzuki Shutting Down its Spanish Motorcycle Production Operations As Well

Japanese company is terminating all of its Spanish-based motorcycle production activities by the end of the first quarter of 2013. Not the best news for a country that is in a deepening recession with an unemployment rate of 25 per cent at the end of September.

"The decision was ultimately made due to accumulated losses created by the reduction and general condition of the economy in Europe at present," Suzuki said in a statement.

"While there is no further comment on which manufacturing plant will take over the production of these models, some alternative models built at Suzuki's Asian country production plants will be considered for the European market," the company added.

Suzuki Shutting Down its Spanish Motorcycle Production Operations As Well - Carscoop
 
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I don't think Suzuki will exist anywhere other than India soon. They don't have good line-up, nor their brand carry any value. In India too, they are alive thanks to Maruti.
 

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