As much as we knew it was a possibility, we have to say that Suzuki's announcement this afternoon that it is filing chapter 11 bankruptcy proceedings caught us a bit off guard. American Suzuki Motor Corporation - the sole distributor of Suzuki automobiles in the United States - will realign its business to focus on motorcycles, ATVs and the marine market.

What does this mean in simple terms? In short, new Suzuki cars and trucks will no longer be sold by Suzuki in the United States once current supplies run out. Period.

Suzuki cites "low sales volumes, a limited number of models in its lineup, unfavorable foreign exchange rates, the high costs associated with growing and maintaining an automotive distribution system in the continental US and the disproportionally high and increasing costs associated with stringent state and federal regulatory requirements unique to the US market."

Motorcycles, ATVs and watercraft will not be affected. Current owners of Suzuki cars, trucks and sport utility vehicles will have their warranties honored, and parts will reportedly be made available. Suzuki will continue to sell automobiles in other countries, naturally, including its home market of Japan.

Read the complete announcement from Suzuki below, and check out this official website set up by Suzuki for current owners.
Show full PR text
American Suzuki Motor Corporation ("ASMC") Announces Restructuring and Realignment to Focus on Motorcycles/ATV and Marine Divisions

ASMC to wind down and discontinue new automobile sales in continental U.S.
Consumers will be protected and all warranties will continue to be fully honored

BREA, Calif.--(BUSINESS WIRE)-- American Suzuki Motor Corporation ("ASMC" or "the Company"), the sole distributor in the continental United States of Suzuki Motor Corporation ("SMC") automobiles, motorcycles, all-terrain vehicles and marine outboard engines, today announced that it plans to realign its business to focus on the long-term growth of its Motorcycles/ATV and Marine divisions. Following a thorough review of its current position and future opportunities in the U.S. automotive market, ASMC will wind down and discontinue new automobile sales in the continental U.S. The Company has determined the best path to achieve this realignment in an efficient and orderly manner is to restructure its operations under chapter 11. The case will be filed in the United States Bankruptcy Court, Central District of California in Santa Ana.

Consistent with ASMC's long history of standing by its products, owners of Suzuki automobiles will be protected. All warranties will continue to be fully honored and automobile parts and service will be provided to consumers without interruption through ASMC's parts and service dealer network.

ASMC remains firmly committed to Motorcycles/ATV and Marine products, and these divisions are competitively positioned in their respective markets, allowing for long-term growth as economic conditions improve. The realignment is intended to better position ASMC for long-term success and is a return to the Company's roots in the U.S. market, which began with motorcycles and has grown to include ATV and marine products. ASMC remains very proud of its high quality, high performance motorcycle, ATV and Marine products. The Company will continue to bring ASMC products to market, including its full lineup of sportbike, cruiser, touring, scooter, dualsport, motocross, off-road motorcycles and KingQuad ATV line, as well as its flagship DF300AP, state-of-the-art DF20A, and DF15A, among other models. Additionally, ASMC is working to further build its market share through continued investment in additional support for dealers through marketing and advertising activities and sales promotion. Suzuki will continue to have a strong presence as a sponsor of teams in supercross, outdoor motocross and road racing.

In evaluating its position in the highly regulated and competitive U.S. automotive industry, ASMC determined that its Automotive division was facing a number of serious challenges. These challenges include low sales volumes, a limited number of models in its line-up, unfavorable foreign exchange rates, the high costs associated with growing and maintaining an automotive distribution system in the continental U.S. and the disproportionally high and increasing costs associated with stringent state and federal regulatory requirements unique to the U.S. market. While the decision to discontinue new automobile sales in the U.S. was difficult to make, today's actions were inevitable under these circumstances. ASMC is dedicated to honoring its commitments to Automotive customers through and after the wind down of new automobile sales in the continental U.S.

An Orderly Process to Serve Consumers
ASMC intends to work within its current U.S. Automotive 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. ASMC intends to market and sell its remaining U.S. automobile inventory through its Automotive dealer network. Through and after the restructuring, all warranties will be fully honored and automobile parts and services will be provided to consumers through the dealer network. ASMC intends to honor any automobile buyback agreements that are currently in place with financial institutions.

As part of its chapter 11 filings, ASMC will submit a proposed Plan of Reorganization and Disclosure Statement that specifies how the Motorcycle, ATV and Marine divisions will be maintained and enhanced, and how its relationship with Automotive dealers will be largely transitioned to support consumers and dealers through continued parts and service operations. SMC or its nominee intends to purchase ASMC's Motorcycle, ATV and Marine businesses, as well as the Automotive service operation responsible for parts and warranties, through a new U.S. subsidiary that will retain the ASMC brand name.

ASMC believes it has sufficient cash on hand to operate its businesses during the restructuring. If necessary, ASMC will request permission from the Court to borrow additional funds from SMC needed during the restructuring.

Honoring Commitments
ASMC intends to operate its Motorcycles/ATV and Marine businesses as usual and is dedicated to completing the realignment process as smoothly and efficiently as possible. ASMC will continue to fully stand behind all of its products and honor all warranties from these divisions. ASMC is working with GE Capital's Retail Finance and Commercial Distribution Finance businesses to continue providing motorcycles and ATV consumer financing programs and motorcycle, ATV and marine dealer inventory financing respectively. The Company expects existing agreements with other dealer and consumer financing providers to continue as well.

ASMC has filed a series of first day motions requesting approval to continue paying employee wages and benefits in the ordinary course, offering dealer incentives and payments under customer warranties. ASMC also expects to pay vendors in the normal course of business for goods and services delivered on or after its November 5, 2012 filing. Payments for goods received before ASMC's November 5, 2012 filing will be made in accordance with the chapter 11 procedure.

SMC, the 100 percent interest holder in ASMC, is not a debtor in the chapter 11 filing.

ASMC's legal advisor on the restructuring is Pachulski Stang Ziehl & Jones LLP, and its financial advisor is FTI Consulting, Inc. Nelson Mullins Riley & Scarborough LLP is serving as special counsel on automobile dealer and industry issues. Further, ASMC has proposed the appointment of M. Freddie Reiss, Senior Managing Director at FTI Consulting, as Chief Restructuring Officer, and has also added two independent Board members to assist it through this period.

Additional information regarding ASMC's business realignment can be found at the Company's website,, or via an information hotline at 1-877-465-4819.

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    • 1 Second Ago
      • 2 Years Ago
      Suzuki really blew it when they decided to not sell the Swift in the US a few years ago just when gas prices went up and they would have had an instantly competitive b-class car.
        • 2 Years Ago
        To be fair, IIRC, they didn't "decide not to sell" but moreso get their hand forced into not selling it. Swift was federalized for the US. Then the partnership with VW happened; and VW wanted to "align products with VW more closely", and it was delayed. Then the Tsunami happened, and it was dead in the water. Even still, B-segment isn't really a huge volume seller in this country....would anyone have bought it?
      • 2 Years Ago
      This is unfortunate. The Kizashi was such a nice looking car that deserved to sell more.
      • 2 Years Ago
      Everyone knew it was coming, so it isn't surprising. What I find weird though, is that since the Kizashi was introduced, I hadn't seen but a handful. In the past two months I have seen one almost every single day. It is almost like they were just starting to catch on in my area. What Suzuki really needed was to bring the Swift here before gas prices went absolutely crazy. The Swift is a fantastic little car, and would have done quite well here. Suzuki has been in such a downward spiral here though, and it is unfortunate how it ended. Mitsubishi is without a doubt next. I predicted that Suzuki and Mitsubishi would exit the US market in less than 5 years, I said that two years ago and one has come true. So long, Suzuki.
        • 2 Years Ago
        Agree on Mitsubishi.
        • 2 Years Ago
        You hadn't seen one before because Suzuki America failed to market the car properly. You are seeing them now probably because they are blowing them out at huge discounts.
      • 2 Years Ago
      Ive never been a Suzuki fan but it saddens me to hear someone fail. Prayers with all affected.
      • 2 Years Ago
      • 2 Years Ago
      Its never good to see a company throw-in-the-towel, regardless of where they are from – American, British, German, Australian, Japanese, etc. Some of those employed in the U.S. will lose their jobs I’m sure. Very sad. I always liked the Grand Vitara, and probably would have bought one as I need a new vehicle. But times are hard, and I just don’t have the money to buy anything on the scale of a vehicle right now. The whole thing just sucks. Maybe one day (hopefully) if/when the market gets better, they can re-enter the U.S. automotive market?
        • 2 Years Ago
        If they do, they would be wise to spearhead the market with the Swift. Make a gas version and an electric version and start out just like Fiat is doing with their 500.
      • 2 Years Ago
      The Samurai Suzuki was the sh*t back in 87,88,then they came with the 89 Tracker my sister had one, that little 4x4 could cut threw the snow.Nice SUV for it's time.
        • 2 Years Ago
        Unfortunately the Samurai rollover problems really killed the Sales of those vehicles .
      Karl T
      • 2 Years Ago
      Too bad they didn't bring the new Swift (here)...... Probably would have sold.
      • 2 Years Ago
      Well, since the brand left us, my Suzuki Kizashi and I are in for a 300,000 mile Banzai charge. Oh yeah. Time to crack open the synthetic oils.
      Andrew Zotos Breslin
      • 2 Years Ago
      I hope Mitsubishi takes a hint and starts making something of themselves. The new Outlander Sport isn't bad, but they need an overhaul!
      • 2 Years Ago
      super unfortunate. they could've done better but just didn't deliver in the US market.
      Avinash Machado
      • 2 Years Ago
      Time for great deals on the Kizashi.
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