Suzuki: Intensive R&D of electrification technology by 2025, investing JPY 1 trillion

Launching strong hybrids and EVs in India, and mini EVs in Japan

2021/12/08

Summary
Released WagonR Smile in Japan and new Celerio in India
Mid-Term Management Plan for April 2021 to March 2026: Focus on development of electrification technology
Development and commercialization of electrification technologies in Japan and India
Suzuki and Daihatsu participating in the "Commercial Japan Partnership" project
Suzuki, Toyota and three other companies: Agreed to jointly develop technical specifications for next-generation in-vehicle communication devices
Suzuki's consolidated financial results
India's Gujarat C Plant begins operations: Production capacity in India to reach 2.25 million units
Production Forecast by LMC Automotive: Suzuki production will be 3.23 million units in 2024

Summary

WagonR Smile with sliding doors released in September 2021
(Source: Suzuki)

Suzuki launched the WagonR Smile equipped with sliding doors on both sides in Japan in September 2021 and the all-new Celerio in India in November 2021.

In the new Mid-Term Management Plan announced in February 2021, the company cited "delays in responding to CASE" (Connected, Autonomous, Shared, and Electric) as a reflection point of the previous medium-term plan, and plans to invest JPY 1 trillion in R&D over the next five years to intensively develop electrification technologies by 2025. The company plans to develop and commercialize the Suzuki Hybrid System and EVs over the next five years. No specific product plans have been announced, but Suzuki will likely:

Utilize joint development with Toyota in EV development
Introduce strong hybrid vehicles and EVs to the Indian market by 2025
In Japan, commercial mini EVs will be developed through the CJP project and expanded to passenger mini vehicles; it will develop and enter the market with EVs at a price to customers in the range of JPY 1 million in real terms by 2025.

Suzuki Motor Corporation (Suzuki) joined the Commercial Japan Partnership (CJP) project with Daihatsu Motor Co., Ltd. in July 2021. The aim of the CJP is to accelerate efforts to become carbon neutral through the spread of the CASE (connected, autonomous, shared, electric) technologies.

In April, Suzuki participated in the joint development of the technical specifications for the Toyota Group's next-generation in-vehicle communications devices.

Suzuki's business performance in the first half (H1) of 2021 (April-September) improved significantly year-over-year (y/y) in terms of global sales volume, revenue and profit, because its performance during the same period the year prior was down sharply due to the COVID-19 pandemic.

However, in Q2 2021 (July-September), global sales volume fell 10.1% y/y to 631,000 units and operating profit declined 39.3% to JPY 44.6 billion due to shortages in the supply of parts including semiconductors and production cutbacks due to the effects of the COVID-19 pandemic. Domestic sales and production have been below the figures for the same month y/y since June, and overseas production and sales have been below the results for the same month y/y since September.

The full-year forecast calls for global production volume of 2,579,000 units (down 2.7% y/y), sales volume of 2,486,000 units (down 3.3%), and sales increasing slightly by 0.7%, but operating income is expected to decrease for the fourth consecutive period, by 12.6% to JPY 170 billion. It is believed that it will still take some time to normalize production.