Suzuki Trims Network; Stays The Course

Automaker Suzuki, by far the smallest of the manufacturers from Japan, is planning to stay put in the United States despite seeing sales tumble by more than 60 percent in recent years.

American Suzuki Motor Corp. told Automotive News that it has bought out 50 dealers, reducing its American dealer network to 304 retail outlets from the 354 it had in March. In its peak sales year (2007) Suzuki had 486 dealers who sold 101,884 cars. Last year, Suzuki sold 38,669 vehicles, but this year sales may drop below 25,000 units at the pace 2010 sales are going. Suzuki is the only car company not experiencing a rebound from 2009′s awful sales.

Poor Planning

Suzuki’s problems over the past few years can be attributed to stiff competition, but there are two larger factors at play: marketing and product. Recently, I sat through what had to be the worst car commercial I’ve seen in many years, this one from Planet Suzuki in Raleigh, NC. Turns out that the ad is part of a national advertising campaign, picked up or modified for select markets across the country and touting the price of the Suzuki Kizashi, the company’s midsize sedan.

The Kizashi is a good model, but the ad is terrible. Actors feigning surprise at the sticker price just doesn’t cut it. The spokeswoman is fine, but the people who are expressing amazement are acting ridiculous.

Product Line

Suzuki’s product mix isn’t much to speak about either. Beyond the Kizashi, there isn’t one model that stands out. That’s too bad because in years past the Swift and various compact SUVs filled an important void. Today, I imagine a lot of Suzuki shoppers have probably fled to Subaru, Kia and Hyundai, car brands who managed to sell more cars in 2009 than 2008, the only three companies to do so.

Notwithstanding Suzuki’s insistence that they will remain around, the company has a lot of work cut out for itself if it plans to survive.

Stiff Competition

General Motors, Ford and Chrysler are in a much strong position than a year ago, Hyundai and Kia continue to gain ground, and Suzuki’s Japanese rivals remain formidable. Volkswagen is expanding its operation too.

In a market where 16-17 million cars are sold, Suzuki might stand a chance. But, the market pie has shrunk and Suzuki’s competitors simply have the Japanese automaker out gunned. Look for Suzuki to make a gallant effort to stay in America, but expect customers to not be moved.

December Glitter Offers Automakers Hope

Surveying 2009 automobile sales figures and you can understand if some manufacturers are feeling anxiety over how their respective brands have performed of late. At the same time, December’s U.S. car sales rose by 15.1 percent over December 2008, the first month in a long time that a double digit jump was recorded without government incentives.

A number of manufacturers had break through months including Ford (+32.8%); Toyota (+32.3%); Hyundai (+40.6%); Kia (+43.7%); and Subaru (+33.5%). Of these five companies, the last three managed to post year over year sales gains while Ford, Toyota, Honda, GM, Chrysler, and Nissan posted losses of 15% or more.

Mitsubishi had a terrible year, seeing its sales fall by 44.5% topped only by Suzuki who dropped off by 54.4%. But for December, Mitsubishi was off by only 4.7% which led to the company making the following comment:

“The improvement in December sales validates our renewed strategies and tactics,” said Shinichi Kurihara, president and CEO of Mitsubishi Motors North America. “The input provided by our dealers’ National Advisory Board has been instrumental in guiding our revised sales plans and actions, and will continue to do so as we collaborate to extend this sales momentum.”

That means that Mitsubishi has figured that its approach was broken and that the automaker was implementing steps necessary to help it move forward.

Chrysler, like General Motors was rocked by bankruptcy this past summer but unlike GM the company has few products to boast of in a bid to attract buyers. That fact hasn’t been lost on customers who have been fleeing the brand in recent years sending sales down to a level not seen in almost sixty years: below one million units.

Still, Chrysler managed to find something good to report for the month of December, even if that comparison was with November, not the previous December:

“As we kick off the new year, Chrysler Group continues to build momentum with some of the best products in the marketplace, and we are enthusiastic about the new products coming this year,” said Fred Diaz, President and Chief Executive Officer-Ram Brand and Lead Executive for the Sales Organization, Chrysler Group LLC. “Our great Chrysler, Jeep, Dodge and Ram products are being recognized by opinion leaders in the industry, and consumers are responding in a positive way. In 2010 the company will continue to earn the trust of consumers with exciting, high-quality vehicles that are priced right.”

Well, your customers aren’t seeing it that way with many people wondering and worrying if Fiat’s takeover will produce the new models that people want or whether the death knell for America’s third largest automaker has sounded.

But not every manufacturer was eager to share news with the public, at least not yet. As of this moment, American Suzuki hadn’t issued the customary news release reflecting on December and 2009 sales. As mentioned earlier, Suzuki posted the worst drop of any full line manufacturer in America for the year, a precipitous downturn that may eventually force the company to pull up its American stakes.

But with the midsize Kizashi now in Suzuki showrooms (pictured), the brand gains a much needed model to help stoke sales. It will need the car too because for the entire year, only 38,695 Suzukis were sold, about the same number of cars that ailing GM sells in one week.

Photo Credit: American Suzuki

Buick Musings, And Then There Was The Excelle

My grandmother regularly purchased and drove new Buick automobiles even though she certainly could have afforded a Cadillac if she so chose. To her, a Buick had enough luxury in it without flaunting personal wealth, something that this Quaker bred woman was loathe to do.

Today, Buick soldiers on as the brand just below Cadillac, a line of premium vehicles that has
diminished in popularity in the US, but has reached meteoric proportions in the People’s Republic of China. Yes, in China of all places the Buick name has gained a solid footing, so much so that is by far General Motors’ most popular brand, selling twice as many Buicks there than in America.

Buick’s popularity in the US is understandable, but why China? Well, you have to go back nearly one hundred years during the reign of the emperors in the Forbidden Kingdom. Cars were new to the world at the time and both the last emperor and the first leader of modern China owned Buicks. Though decades of communist rule stamped out most Western practices and traditions, the quasi-capitalistic Chinese state of today has once again embraced all things global, uncovering the early interest in the Buick brand.

Due to the popularity of Buick in China, GM has bolstered the brand considerably by offering several more Buick models there than the three models sold in the US. While the American market has the LaCrosse, Lucerne, and Enclave, China sells several different models which are essentially rebadged versions of other GM products from Daewoo, Opel, Holden, and elsewhere. This year, Buick also began to export to China from the US its big Enclave crossover in a bid to expand its Chinese line up.

Of the cars sold in China, are there any that can also be sold in the US? One model that has gotten a lot of attention this year is the Buick Excelle, a compact sedan that is smaller than the LaCrosse, the smallest of the two sedans currently offered by Buick (Lucerne being the other one). The current iteration of the Excelle is based on a Daewoo platform and sold throughout Asia and other parts of the world as Daewoo, Holden, Chevrolet, and even Suzuki models. Powered by small four cylinder gas engines with a displacement between 1.4L and 2.0L, the Excelle could be just the type of model fuel conscious Buick buyers would consider buying, provided that the quality and luxury levels were there.

Beginning with the 2009 model year, a new Excelle is being sold overseas, a vastly improved model that has sweeping lines and unmistakable Buick features including the signature fascia and ornamental portholes. That model has fueled recent rumors that GM would make the Excelle available stateside, whether imported from China or built in a US factory remains unknown, but is a distinct possibility nonetheless.

Powered by 1.6L or 1.8L four cylinder engines, the Excelle would certainly be the smallest Buick sold stateside in quite some time. Likely, if GM chose to bring the car to the US, it would be mated to a six-speed automatic transmission to help it achieve superior fuel economy. Perhaps GM would even consider offering a six-speed manual transmission to broaden the car’s appeal to a younger generation. Easily, a compact Buick should get about 35 mpg, a figure which would help GM meet more stringent federal Corporate Average Fuel Economy (CAFE) requirements.

If my grandmother were alive today, I doubt that she would choose a car as small as the Excelle, given her larger car tastes. But, if GM manages to offer this car stateside with a level of quality and luxury that Buick drivers expect, the Excelle could once again bolster the brand’s image and be a hit with American drivers eager to enjoy compact luxury car driving.