In November, Suzuki’s automotive division in announced that it would be shutting down its operations in the United States. On Thursday, December 20, American Suzuki Motor Corp successfully filed for Chapter 11 bankruptcy protection, in Santa Ana, California, winning permission to close its automotive operations, while re-organizing its motorcycle and boat businesses.
But that’s not all that went down in the court as U.S. Bankruptcy Judge Scott Clarkson also approved Suzuki’s request to borrow $50 million to import extra cars from Japan. Confused? Well, allow us to explain.
Suzuki saw its car sales jump 22 percent to 2,224 units in November, while the company’s dealers reported that the sales are up in December as well, mainly due to big incentives and a seven-year warranty program, so the company decided to offer its dealers one last gift.
“When we told dealers, ‘We have one last chance,’ the dealers said, ‘Go get them,’” M. Freddie Reiss, Suuzuki’s chief restructuring officer, told BusinessWeek. However, he added that, “No more cars are being manufactured for the U.S. market.”
According to Reiss, this won’t change Suzuki’s decision to exit the car market in the U.S., as the company will only sell around 22,000 cars in the States this year, compared to 120,000 in 2007.
Story References: BusinessWeek
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