JAPAN: Suzuki to focus on Asia following US pull-out
Suzuki will focus on emerging markets in Asia following the company’s decision to withdraw from the US.
The carmaker had been in the US market for 30 years, initially in alliance with General Motors, and it was the company’s first serious move into a foreign market.
Early success came with its small SUVs which became popular with young buyers, particularly on the west coast, but its fortunes took a downhill turn following GM’s decision to reduce its stake in 2006.
After GM filed for bankruptcy protection in 2009, Suzuki sold its stake in Cami Automotive, its joint manufacturing venture with the US carmaker in Canada.
Suzuki sales in the US fell to 26,000 cars in the US in fiscal 2011 from 102,000 in 2007 and its North America sales unit has lost money for the past two years as the strong yen has affected the profitability of exports from Japan.
Since ending its partnership with GM, Suzuki dabbled with a strategic partnership with Volkswagen but alliance talks broke down leaving the Japanese company on its own.
Suzuki will now focus on markets in which its product line can be competitive, building on its success in India which accounted for some 40% of the firm's global sales of 2.56m units in FY 2011.
According to the Nikkei business weekly, Suzuki is trying to ramp up its share of a number of southeast Asian markets to reduce its heavy dependence on India. In March, the company launched operations at a new plant in Thailand where it produces the Swift hatchback for several other Asian markets.