Today’s Nikkei [sub] agrees with the TTAC commentariat that Suzuki is overripe for a takeover. “Now that Suzuki has dissolved its joint venture assembly plant with General Motors Co. in Canada, the Japanese automaker, with its long presence in emerging markets and strength in subcompacts, appears an attractive partner for an alliance.”
No kidding. As it has been pointed out by TTAC’s Best & Brightest, Suzuki has what other makers need, and Suzuki needs what other makers have.
Suzuki has India, for starters.
Says the Nikkei: “Suzuki had raced ahead of rivals to kick off local production in such developing countries as India, China and Pakistan. This has driven earnings at the automaker, which today still dominates the Indian market with a 50 percent share. By expanding business in India, the firm’s operating profit in the Asian region overtook its Japanese tally for the first time last fiscal year. “
What does Suzuki need? “The firm faces a growing need to find a partner because of its late start in hybrids, electric vehicles and other environmentally friendly offerings,” says the Nikkei. Greenwashing aside, what Suzuki really needs is size.
With an output of 2.36 million units a year, Suzuki is a tad too small to tough it out with the big boys. Yet, those 2.36 million are more than big enough to make someone like Volkswagen the world’s #1 in an instant. VWs Piech has been long been rumored to be lusting for the attractive Japanese bride.
The Financial Times also weighs in on the matter: “Far more interesting are the advanced negotiations apparently under way between Volkswagen and Suzuki. VW is already Europe’s biggest and is challenging Toyota for the top slot in the world car league. Ferdinand Piëch, VW’s veteran chairman and consummate empire builder, has always said he would like to see the German group controlling 12 brands.”
Muses the FT:
“The deal with the Japanese company would help resolve VW’s Achilles heel. Despite its successes, VW has in recent years struggled to manufacture profitably low-cost small vehicles. Suzuki, by contrast, has long had an impressive record of making small cars profitably and an enviable emerging markets exposure in countries such as India or Indonesia that can only make a partnership even more attractive for VW.”
“In return, the Germans would offer larger car, diesel and electronics expertise and better access to European and US markets to Suzuki. For the Japanese company has struggled to build a strong position in Europe and has had trouble hanging on in the North American market.”
“Mr Piëch would presumably also enjoy undermining some of his biggest rivals by striking a deal with Suzuki. Renault-Nissan, too, is believed to have considered investing in Suzuki and bringing it into its international alliance. “
With whom will the Nipponese beauty walk down the aisle? With the Austro-Teutonic leader of industry with floppy ears and a well-documented appetite for companies and women? Or with the suave French charmer who offers a menage a trois with Renault and Nissan? Stay tuned for the next episode of Nippon Nampa …