When American Suzuki announced it was filing for Chapter 11 and dropping out of the U.S. automobile market last November, its counterparts in Canada said it would continue to sell cars for that market. It now appears that will only last for one more year, as Suzuki Canada announced it would also stop selling cars following the 2014 model year to focus on its powersports operations.
The move wasn’t entirely a surprise. Canada is a much smaller market than the U.S. According to the Financial Post, Suzuki sold about 5,500 cars in Canada in 2012, representing a 0.3% share of the market. By comparison, American Suzuki says it sold 1,764 cars in February 2013 alone, and that’s with customers knowing the company is quitting the business. Importing cars to Canada costs a lot of money and the sales do not appear to justify the expense.
The reason for the delay was likely because Suzuki Canada already had an order for a supply of 2014 models from the parent company, Suzuki Motor Corporation of Japan. Suzuki Canada says that it and the parent company came to this decision after “monitoring market conditions carefully and, after reviewing the long-term viability of automotive production for Canada” following the American Suzuki announcement.
Like its American neighbors, Suzuki Canada will realign itself to focus on its motorcycle, ATV and marine division. Unlike American Suzuki, Suzuki Canada is not filing for Chapter 11 and will not require court-supervised restructuring. Suzuki Canada will continue to operate under that name, unlike American Suzuki which had to form a new company under the name Suzuki Motor of America.
Suzuki Canada says it will continue to honor all warranties and will still provide parts and service to its automotive customers.
[Source: Suzuki Canada; Financial Post]