Suzuki focuses on India; 2019 sales targeting 3.4 million
Minicars, compacts and SUVs are Suzuki's strategic segments
2015/09/10
- Summary
- Product Strategies: Consolidation of passenger car platforms and gasoline engines
- Regional strategies: Focusing on Japan, India and other Asian countries
- India: Aiming to expand market share and achieve two million unit sales in 2020
- Minicar market in Japan: Severe market share competition compress profits
- Indonesia and Thailand as next market pillar: Both suffering from sales decline
- FY 2015 business forecasts： Aiming for record-high operating profit of JPY 190 billion
- Sales Forecast by LMC Automotive: Suzuki’s sales will be 2.8 million units in 2018
- Statistics
Summary
SUZUKI NEXT 100: new mid-term management plan
- Emphasize India and Japan as main markets and develop Indonesia and Thailand as production base
- Focus on minicars, Segment-A, B, C cars and Small Utility Vehicles (SUV)
- Consolidate platforms and engines
・ Suzuki Motor Co., Ltd. announced in June 2015 “SUZUKI NEXT 100,” its new mid-term management plan through the fiscal year ending in March 2020 (FY 2019).
・ It anticipates that in the global automobile market, demand for small cars from minicars, Segment-A, B, C cars and SUVs will expand and that India will grow into the world’s third largest automobile market.
・ As LMC Automotive Limited predicts, Suzuki’s sales in India are expected to account for a half of its sales in the future. Suzuki has a sense of danger in solely depending on the Indian market.
・ Fiercer competition in the Japanese minicar market is compressing Suzuki’s profit.
・ In Thai and Indonesian markets, Suzuki’s third pillar after Japan and India, business is slowing down.
・ In India, Suzuki’s market share is picking up. Construction of the new plant to be operational in 2017 started and the new luxury sales channel has been launched. The OEM is implementing such measures to achieve two million unit sales in India in 2020. Success in India is a key for the mid-term management plan.
・ When announcing the mid-term management plan, the OEM also revealed that Chairman & CE0 Osamu Suzuki, who has led the automaker for about forty years, would pass over the presidency to his eldest son, Mr. Toshihiro Suzuki and that the OEM will move the mid-term plan forward through the collective leadership.
・ On August 30, 2015, Suzuki announced cancellation of the alliance with Volkswagen AG (VW). In September 2011, it demanded VW to dissolve the capital and business alliance concluded in 2009. As VW did not respond to the request, Suzuki filed the arbitration with the International Court of Arbitration of the International Chamber of Commerce in November 2011. Suzuki received an arbitration award including termination of the agreement and VW’s disposal of its 19.9% shares in Suzuki. Suzuki’s breaches of the agreement were also upheld and that the amount of damages, if any, would be addressed in the future arbitration.
Business targets in the midterm plan
| FY 2014 Results |
FY 2015 Plans |
FY 2019 Targets |
 |
|
|---|---|---|---|---|
| Consolidated net sales |
JPY 3,015.5 billion | JPY 3,100 billion | JPY 3,700 billion | |
| Operating income margin |
6.0% | 6.1% | 7.0% | |
| R&D Expenses | JPY 125.9 billion | JPY 130 billion | JPY 200 billion | |
| Capital Expenditures |
JPY 194.5 billion | Five-year cumulative amount of JPY 1 trillion (FY 2015 forecast: JPY 180 billion) |
||
Related Reports:
Suzuki: Radar Brake Support available on commercial mini vehicles (Apr. 2015)
Free membership registration allows you to read the rest of the article for a limited time.