Suzuki forced to exit China, most buyers prefer SUVs

Suzuki forced to exit China, most buyers prefer SUVs

Suzuki Motor has announced that it is pulling out of China after dissolving its last remaining 50% stake in Changan Suzuki and having it transferred to Chongqing Changan Automobile. The decision comes as consumers in the world’s biggest car market shifted purchases to larger sedans and sport utility vehicles, reports Bloomberg. Changan will continue to make and sell Suzuki-branded cars in China under a license.

“Approximately 25 years ago, we launched the Alto in China, and since then we have made efforts in cultivating the Chinese market. However, due partly to shifting of Chinese market to larger vehicles, we have decided to transfer all equity to Changan Automobile,” company chairman Osamu Suzuki said via a statement.

Suzuki has been in China for 25 years, and the retreat marks the second big move following its exit from the US market in 2012. Suzuki was present in the US for 30 years. However, the Japanese carmaker continues to be dominant in India, which is presently one of the world’s fastest-growing major car markets. Through its local entity Maruti Suzuki, about one of every two cars sold in the country of 1.2 billion people is a Suzuki.

Suzuki forced to exit China, most buyers prefer SUVs

Suzuki Ciaz facelift in India

Compared to India (where small to mid-sized cars are preferred), the market share of small economical cars in China plunged to 6.7% last year from 35% in 2003, said Cui Dongshu, secretary general of the China Passenger Car Association. This is because in the past decade, the purchasing power of consumers in China has rapidly increased, thus the shifting demand towards larger and more spacious vehicles. According to the LMC Automotive, Suzuki sold more than 266,000 cars in China in 2014, but last year sales dwindled to around 119,000 vehicles.

Sales at the Suzuki Changan joint venture declined 27% last year, a Bloomberg Intelligence data shows. Even the introduction of the Vitara and S-Cross SUVs have done little to boost sales. However, Changan said it will fully support Changan Suzuki’s operations in China, and it will keep selling Suzuki-branded cars and provide related services. Suzuki dissolved its other Chinese venture, a 23-year-long partnership with Jiangxi Changhe Automobile, in June.

Moving forward, Suzuki aims to boost sales in its biggest market India to five million vehicles annually by 2030, said president Toshihiro Suzuki. It plans to double the line-up to 30 models in the process.

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Matthew H Tong

An ardent believer that fun cars need not be fast and fast cars may not always be fun. Matt advocates the purity and simplicity of manually swapping cogs while coping in silence of its impending doom. Matt's not hot. Never hot.

 

Comments

  • Suzuki should focus in Msian market instead.

    Like or Dislike: Thumb up 18 Thumb down 0
  • Habislah Suzuki lord! What happen to their Vitara & Jimny?

    Like or Dislike: Thumb up 11 Thumb down 0
  • Not Toyota Fan on Sep 05, 2018 at 2:57 pm

    Like it or not, the global trend today is SUV. It’s the only segment showing a double digit growth.

    We’re behind the curve but slowly catching up.

    Like or Dislike: Thumb up 3 Thumb down 1
  • bodo suki on Sep 05, 2018 at 2:58 pm

    Wow.. never see that coming… SX4 is quite popular among taxi operator and plenty of clone Suzuki Carry/Every can be spotted around.

    But then Suzuki is stupid enough to kill Kizashi just because of poor sales in US and Japan.

    Like or Dislike: Thumb up 4 Thumb down 0
  • DPillai on Sep 05, 2018 at 3:28 pm

    Proton can expand into India with their small and mid-sized cars since one of every two cars sold in India of 1.2billion is Suzuki small carmaker.

    Like or Dislike: Thumb up 4 Thumb down 0
  • FrankC on Sep 05, 2018 at 3:39 pm

    Not only proton find it hard to penetrate foreign market Suzuki too find it hard to survive. If not for local partnership. Automotive industry is very competitive and protected.
    Automotive is at its junction now. New technologies and trend has opened up new opportunities to non automotive company to get in and drive it. So it’s opportunity for pertiga too if they look carefully and move swiftly in proper direction.

    Like or Dislike: Thumb up 1 Thumb down 0
  • Suzuki’s future doesn’t seem so bright with current management since ailing company like Proton also can take them for a ride.

    Like or Dislike: Thumb up 4 Thumb down 4
    • Yup. Ailing company like VW. Based on ur logic.

      Like or Dislike: Thumb up 9 Thumb down 4
      • Takyahlah nak dekat-dekatkan diri nak compare dengan VW, Toyota or Honda. Sedarlah sikit. Itu company besar, bukan kecik like Proton.

        Like or Dislike: Thumb up 2 Thumb down 8
        • Why blame me? Im just following ur logic dude. If u got a bone to pick, look in the mirror.

          And Suzukis fortune went downhill after their acrimonious divorce with VW. Suzuki and P1 still buddy buddy yo.

          Like or Dislike: Thumb up 2 Thumb down 0
        • Global proton.
          https://paultan.org/2016/08/15/proton-capable-of-being-competitive-global-player-madani/

          Like or Dislike: Thumb up 3 Thumb down 0
  • Ben Yap on Sep 05, 2018 at 4:23 pm

    suzuki is better off building motorbikes.

    Like or Dislike: Thumb up 1 Thumb down 1
    • Suzuki Cappuccino lejendary but in the past alredi. Jepunis lejen models all gone, replace by boring & overpriced shitboxes.

      Like or Dislike: Thumb up 7 Thumb down 0
 

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