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Suzuki leaving U.S. market, seeks Chapt. 11

Suzuki Motor Corp. said Nov. 5, 2012 that

Suzuki Motor Corp. said Nov. 5, 2012 that it would exit the U.S. auto market.

TOKYO -- 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 United States, though it will continue offering motorcycles, all-terrain vehicles and boat motors, the Hamamatsu, Japan-based carmaker said in a statement yesterday. 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 U.S. sales 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, said Hideki Taguchi, a company spokesman in Tokyo.

Suzuki's U.S. sales 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.

The departure will leave Mitsubishi Motors Corp. as the smallest Japanese automaker selling vehicles in the United States. Mitsubishi's sales this year have fallen 29 percent to 50,103, reducing its market share to 0.4 percent from 0.7 percent, according to Autodata.

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