American Suzuki will end U.S. auto sales, files for Chapter 11 bankruptcy protection

Article by Christian A., on November 6, 2012

It appears that American Suzuki Motor Corp. is not so lucky in the United States as the manufacturer, whose U.S. demand plunged while the rest of the manufacturers climbed back from recession, announced that it will end its “love story” in USA. Moreover, American Suzuki filed for Chapter 11 bankruptcy protection.

In an official statement, Suzuki said that it will continue its motorcycle and marine engine businesses and will also continue to honor its auto customers’ warranties. Japanese parent Suzuki Motor Corp added that the company is not seeking protection from creditors. In order to explain its move, Suzuki said that it "has exhausted all available means to reduce the cost of operating the Automotive Division for it to operate profitably."

Furthermore, Suzuki said that some of the changes that made it take this decision were "unfavorable foreign exchange rates, disproportionally high and increasing costs associated with meeting more stringent state and federal automotive regulatory requirements unique to the continental U.S. market, low sales volumes, a limited number of models in its line-up, and existing and potential litigation costs."

Still, this is not new as other small manufacturers such as Daihatsu, Isuzu and Daewoo also dropped out of the United States market. If in 2003 Suzuki was planning to sell over 200,000 in the United States but it barely reached selling 100,000 units in 2006 and 2007. In 2009 Suzuki managed to sell 38,695 vehicles, while in 2011 only 26,618 Suzukis were sold.

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