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Suzuki Emblem

Bloomberg reports American Suzuki is set to borrow up to $45 million to to close its automotive dealerships and freshen up its it motorcycle and marine business. Suzuki Motor Corporation will loan American Suzuki the funds at three percent below the London Interbank offered rate in order to offer dealer owners a cash payment in exchange for voluntarily abandoning franchise agreements. The company's 216 dealers have 10 days to make a decision on the matter. Under the plan, Suzuki would give dealer owners half of what they're owed in one lump sum, and the dealers would then be able to pursue the remaining debt through the company's bankruptcy procedure.

U.S. Bankruptcy Judge Scott C. Clarkson granted American Suzuki interim authority to borrow the funds, but Bloomberg reports the company will likely return to court in a few weeks to seek up to $100 million. According to Richard Pachulski, a lawyer for Suzuki America, the automaker may owe its dealers somewhere around $50 million.

Suzuki has to take out $45M loan just to shutter US dealers originally appeared on Autoblog on Thu, 08 Nov 2012 16:30:00 EST. Please see our terms for use of feeds.

Permalink | Email this | Comments]]>american suzukibankruptcysuzukisuzuki bankruptcysuzuki dealerssuzuki loansuzuki motor corporationThu, 08 Nov 2012 16:30:00 EST http://www.autoblog.com/feed/20374306/article-comments.xml http://www.autoblog.com/feed/2012/11/08/suzuki-has-to-take-out-45m-loan-just-to-shutter-us-dealers/20374306/article-detail.xml 20374306 http://www.blogcdn.com/www.autoblog.com/media/2012/11/suzuki-emblem-628-1352395975_thumbnail.jpg http://www.blogcdn.com/www.autoblog.com/media/2012/11/suzuki-emblem-628-1352395975.jpg <![CDATA[American Suzuki Motors files chapter 11, will no longer sell cars in the United States]]>http://www.autoblog.com/2012/11/05/american-suzuki-motors-files-chapter-11-will-no-longer-sell-car/http://www.autoblog.com/2012/11/05/american-suzuki-motors-files-chapter-11-will-no-longer-sell-car/http://www.autoblog.com/2012/11/05/american-suzuki-motors-files-chapter-11-will-no-longer-sell-car/#commentsFiled under: , ,

Suzuki emblem

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.

Continue reading American Suzuki Motors files chapter 11, will no longer sell cars in the United States

American Suzuki Motors files chapter 11, will no longer sell cars in the United States originally appeared on Autoblog on Mon, 05 Nov 2012 19:39:00 EST. Please see our terms for use of feeds.

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