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Suzuki To End Car Sales In U.s.,

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TOKYO (Reuters) - Japan's Suzuki Motor Corp will pull the plug on its unprofitable automobile sales business in the United States after nearly three decades, hurt by a strong yen and a limited choice of vehicles that failed to excite consumers.

Suzuki said on Tuesday it would use a Chapter 11 bankruptcy filing by its U.S. subsidiary in federal court in California to shut down the auto business and to focus instead on sales of motorcycles, All-Terrain Vehicles (ATV) and boats.

The departure of Suzuki ends a 27-year effort to gain traction in the world's second-largest auto market and should most benefit Kia Motor andNissan Motor , the two brands that car shoppers most compared to Suzuki, according to car shopping website Edmunds.com.

The bankruptcy could allow Japan's No.4 automaker to step away from its contractual responsibilities to the more than 200 dealers who maintain franchises, much asGeneral Motors and Chrysler were able to drop dealerships in their 2009 bankruptcies.

Suzuki models did not catch on in the United States, and the company suffered from a lack of investment in new vehicles. It also struggled from the strong yen that makes it more expensive to export products from Japan.

It sold 21,188 vehicles in the United States through October this year, a 5 percent drop from the previous year at a time when the overall market was up by 14 percent. That made the brand the second worst-selling mainstream brand, behind the Smart micro-car.

Suzuki, which had marketed the Kizashi sedan and the Grand Vitara SUV in the United States, said it would continue to honor warranties during the bankruptcy and did not see the need for outside financing during the restructuring.

American Suzuki Motor Corp, the sole distributor of Suzuki vehicles in the continental United States, will file for bankruptcy with $346 million in debt, of which $173 million is owed to Suzuki group companies, the company said.

The Japanese parent company plans to buy the motorcycle, ATV and outboard engine operations out of bankruptcy and shift its auto business to service existing vehicles on the road. The new U.S. operating unit plans to keep the American Suzuki name, it said.

Suzuki's failed tie-up with Volkswagen on vehicle development had raised questions about its commitment to the U.S. market and whether it would be able to invest in a revamped product line-up months before Tuesday's announcement.

Shares of Suzuki sunk in early morning trade but were up 0.38 percent at 1842 yen as of 11:01 a.m., slightly outperforming theNikkei index that was down 0.3 percent.

(Reporting by Mayumi Negishi, Kevin Krolicki and Yoko Kubota in Tokyo, Sharanya Hrishikesh in Bangalore; Editing by Steve Orlofsky and Ken Wills)

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Just as well they weren't on our new car radar!

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I have never been a fan of Suzuki, sometimes I even ask "do they still exist? I never see any of their vehicles on the road...or a dealership..." then there's my grandpa's 2001 Suzuki Aerio Sedan...I have never been in such a horrible, thirsty little car >.<

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With them out of the USA, once new models are developed, I would expect them to quit Canada too, because developing a N.Am. version just for Canada is not going to cut it financially.

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Kinda sad, but their marketing has been a horrible miss.....The Kizashi ought to have done better, save for it's price point in Canada....It will take a bit of extra time to wind down Canada I guess.... I cannot see them crash testing a car and doing emissions just for Canada....

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I am sure they will continue to sell cars here for sometime, look at smart, bmw, mercedes, vw, all companies that offered unique products in our market vs the USA. I think it is a shame they pulled out, I have never owned one but friends swear by their product and kept their cars for 300k +kms in tough conditions which is kinda rare these days. They offered cars that had good engines from what I understand and unique engineering that never caught on, maybe not as unique as Volvo or Saab but different from the other Japanese makers (which is good I think as boring in not good!). Funny how there was no rumour going around first like Saab...

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Suzuki in North America lost their way in the early 2000's, and rambled through a very disconnected product line..... crappy GM/Daewoo cars (although in Canada, we only saw the Verona, and not the Fireza and Reno), an un-swift and fuel thirsty Swift (with two GM faceplates dwarfing it all the meanwhile in the Wave and Aveo).The CAMI built XL7 was a dismal flop and waste of time.Where Suzuki entered the 2000's with THREE vehicles top of class in fuel efficiency (Esteem wagon, Vitara 1.6 litre and Swift)... by the end of the decade, where are they? Middle of the pack.We have been subjected to IMO the very worst car advertising of the decade.... (The 'Believe it' campaign with stupid faces looking aghast plastered everywhere beside a Suzuki logo (and no car), for like a whole year..... and then there was the 'Wolf Boys' TV advertising for the SX4..... rediculous.....) Suzuki was doing so poorly, they pulled out of autoshows... they weren't in Vancouver the last few years.... Consider that in the late 1990's, I was drawn to Suzuki by their really successful Grand Vitara TV advertising.....They made themselves irrelevant.In Canada, The Kizashi was WAY overpriced, and it took til this fall to get some real price reductions on the car with a strong loonie in tow..... and too late....... they are just clearing house nowCanada - how can it survive on it's own with the existing lineup? When the lineup changes, will they want to emissions test and crash test for our market only? Sorry, but I say Suzuki is done in Canada on the auto side within a year or two.I one day hope for a RHD Jimny

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I still like the X90! It was narrowly beaten out by my smart when I decided I needed a small very efficient car for work, and my truck had to go. It was getting too old and ugly for the city anyway, still alive and well up in Powell River. The X90 would have accomplished the recreational 4WD aspect of my needs as well, which is filled by the RAV4 now. (The grief I get when I get the "her" RAV dirty makes me regret my decision occasionally!)

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I had three X-90's over time.....Poor handling... front end too light and the car, sorry, trucklet was floppy on the highwayCool though....

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I one day hope for a RHD Jimny

I rented a Spanish made Petrol powered Suzuki Jimny, RHD, in Barbados last September. It's about was wide as a Smart (well it felt like it). Spare tire on back, RWD plus 4x4 on the fly switch. High off the ground, and great mileage. I drove it all around the island for a week on one tank of fuel! It was great on 30 degree inclines...it was like the Smart I always wanted...only a Turbo Diesel model.That being said, I test drove a New 2012 Suzuki SX4 JLX today. I loved it. I want one. 40 mpg, 150 hp pre chiptune. FWD with 4x4(awd) switch. 6 spd Automatic CVT transmission with Manual Shift AND shift paddles. Custom shop Moonroof, aftermarket SatNav/Bluetooth/DVD player, 9 speaker system with sub, keyless entry (you just push a button on the door handle if the key is with 12" away from car, and it opens", Keyless start (car detects if key is the car. Just turn the dial...also you can't lock your keys in the car....car won't lock until it detects keys are out). The clearance and cab room are both quite high....only 1" less clearance than the Grand Vitara, and these things all tower over normal cars.$23,788 marked down...have a look...

post-8008-1355894342_thumb.jpg

Edited by SoulSurgeon

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They'll be giving them away soon, just you wait. When Peugeot pulled out in 1991, their last few cars went for 40-50% discounts.

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Mike,Thanks again my friend. SOO glad I didn't buy one last year. I just did an autotrader search for the SX4. 2013's are now going for $15k-17k....

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