Summary of Suzuki Samurai Case

Only available on StudyMode
  • Download(s) : 526
  • Published : July 27, 2010
Open Document
Text Preview
Summary of the Suzuki Samurai Case
Suzuki Loom Works was founded in 1909 in Hamamatsu, Japan by Michio Suzuki. The transition from loom manufacturing to motorcycles took around 45 years when in 1954, Suzuki Motor Company was formed. After the success of the motorcycle business in 1950s , the company forayed into lightweight cars and trucks, with the introduction of “Suzulight”,the first Japanese car with a two stroke engine in 1961. I n 1964, U.S .Suzuki Motor Company Ltd.was formed, in the United States, to serve as exclusive importer and distributer of Suzuki Motorcycles, where it quickly became an established brand. In 1983, General Motors picked up 5 % stake in Suzuki and introduced Chevrolet Sprint on the West Coast in the mid 1984 and was sold exclusively by Chevrolet dealers. The sprint was Suzuki’s first entry into the Continental U.S automobile market. But the Sprint was subject to Voluntary Restraint Agreement( VRA), in place since 1981, and hence in 1984, Suzuki’s total VRA quota of 1700 cars went to G.M as Sprints. Suzuki called itself “The always something different car company” and planned to introduce several unique vehicles into the U.S market and hence formed a new subsidiary “American Suzuki Motor Corporation”(ASMC) and on MAY 10,1985 hired Douglas Mazza to organize and head its new subsidiary. It also negotiated with the Canadian Government to build a plant in Ontario to produce around 200,000 compact cars per year, so as to begin selling cars in the United States under its own name from 1989. But market forces made Suzuki wait until the end of 1989. In 1984, Japanese imports touched 17.7 % share of U.S new car and truck sales and based on this industry experts predicted that it would touch 19.2% share of U.S market in 1985. The U.S automobile sale was expected to grow by 10 % in 1985. Moreover Hunadai Motor Company of South Korea and Yugo of Yogoslovia were expected to enter the U.S market in 1986.Suzuki feared that it might lead to brand...