The Washington Post

Suzuki Shuts Down U.S. Auto Sales, Files For Bankruptcy

On a day that's likely to have many shocking twists and turns for Americans, here's some news that will surprise absolutely no one: Suzuki is exiting the U.S. auto market.

According to Reuters, the Japanese company said earlier today that its auto division will file for bankruptcy in California, where U.S. operations are based. Suzuki will continue to sell cars, trucks, and crossovers in other parts of the world, but in America, it will refocus its energies on ATVs, boats, and motorcycles.

What took so long? 

In all honesty, we've been expecting this announcement for some time. Suzuki is one of the few automakers in the booming U.S. auto market that has failed to realize year-over-year gains. As of October 31, Suzuki had sold 21,188 vehicles, 4.7% below 2011.

That's largely because Suzuki vehicles have failed to catch on with American drivers. You can blame their design, which has often seemed quirky. Or you could blame the build quality, which hasn't always lived up to the standards set by Suzuki's detail-oriented Japanese colleagues. But even the Kizashi -- arguably the best Suzuki ever introduced in this market -- didn't stand out.

Of course, there were other factors. The strong yen has created huge problems for automakers across Japan, increasing the cost of production in that country and causing losses during currency conversion. In fact, the strong yen is one of the reasons that companies like Honda have moved more of their production stateside in recent years. 

Suzuki's breakup with Volkswagen didn't help, either. If the two had toughed it out, Suzuki might've been able to tap into Volkswagen's huge U.S. operations to build new cars and reach new customers.

There were other hints of problems, too. Suzuki hasn't made an appearance at the Detroit Auto Show in some time, which is rarely a good sign for an automaker doing business in the U.S. And Suzuki's website -- at least the portion of it geared toward journalists -- has long been a source of frustration. That might simply be blamed on bad web designers, or it might be symbolic of the company's reluctance to communicate.

Not surprisingly, that site holds no mention of the shut-down of U.S. auto sales or details of what current Suzuki owners should expect in the way of warranty coverage. However, Reuters reports that Suzuki will honor those warranties during the bankruptcy proceedings.

We can only assume that Suzuki chose to make its announcement on the day of the U.S. presidential election to avoid becoming headline fodder -- a strategy that'll probably pay off.

But even if the company had waited a few days to drop the hammer, we hope it wouldn't have surprised Suzuki's U.S. workers. If it did, the good news is that the company's other units are much more robust, so perhaps many of those folks will be offered jobs with Suzuki's ATV, boat, and motorcycle operations. And if not, the rest of America's auto industry seems to be hiring.

Will you miss Suzuki? Or have you already forgotten that it did business here? And most importantly: who might be next to depart? (Looking at you, Mitsubishi.) Share your thoughts in the comments below.

(c) 2012, High Gear Media.



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