Japanese based auto company Suzuki said that it would shut down its auto business in the US market on November 6, 2012. The company cited losses in the US car business for the shut down and will also file for bankruptcy due to a strong yen and weak demand for its small cars in the US.
On the other hand, the company also said that it would continue to sell motorcycles despite the fact that it has a debt of USD 346 million. The company will also continue to sell all-terrain vehicles and marine products such as outboard motors in the country.
In the year 2011, Suzuki sold about 26,000 vehicles in the US. The auto manufacturer also faces tough competition from other Japanese automakers like Toyota, Nissan and Honda in the US. The firm said in a statement, “ASMC recognized it will be unable to maintain profitability with respect to its automobile marketing business”. The Suzuki division also said that it has faced difficulties with the value of Japanese currency and weak demand for its compact cars in the US market.
The company’s auto division employs about 365 people. The yen has been responsible for the hit to Japanese auto manufacturers by making their products less competitive in overseas markets, as a result the company has also concentrated more on emerging markets like India, where its profitable joint venture Maruti Suzuki is the nation’s biggest automaker.