By Kevin McCauley
FTI Consulting is handling the Chapter 11 filing of American Suzuki Motor Corp., an also-ran in the U.S. automaker market.
Parent company Suzuki Motor Co of Japan has decided to concentrate on the sale of motorcycles, all-terrain vehicles and outboard motors in the U.S. Its auto focus is now on Japan, China and India.
ASMC offers multiple excuses for its decision to end car sales here. They include low sales volume, a limited number of models, unfavorable foreign exchange rates, costs associated with growing/maintaining an automotive distribution system and the “disproportionally high and increasing costs associated with stringent state and federal regulatory requirements unique to the U.S. market.” It calls the U.S. retreat a “restructuring and realignment.”
The company entered the U.S. market in 1985, and enjoyed its record year of 102K cars sold in 2007. Suzuki sold 26K cars for the fiscal year ended March, and registered a $15.8M net loss.
ASMC promises to work with its current “dealer network to help structure a smooth transition from new automobile sales to exclusively parts and service operations, or, in some instances, an orderly wind down of dealership operations.”
FTI’s Kal Goldberg and Rachel Rosenblatt work the ASMC bankruptcy. |