Suzuki Death Watch 7: Inside The Horrible Dysfunction At American Suzuki

by Derek Kreindler

Published: November 6th, 2012

suzuki death watch 7 inside the horrible dysfunction at american suzuki

Late last night, we were contacted by an employee of American Suzuki Motors Corp, who reached out to TTAC to vent his frustrations regarding the downfall of ASMC’s auto business. The picture painted by this employee is one of a highly dysfunctional operation, focused only on tomorrow and never beyond that, a revolving door of Japanese management and deep antipathy for American workers.

Though we’ve confirmed the identity of this Suzuki employee, they wished to remain anonymous due to the sensitive nature of their remarks.

Over the course of our Death Watch, one of the most persistent claims that we’ve heard on background has been the appalling corporate culture that exists at ASMC. American workers were apparently mistreated by the Japanese managers brought in to run the company for a year or two, and had little investment in the success of ASMC.According to the subject of our interview, it was worse than that.“I have been here 5 years. In this time, we have gone though several regime changes. Most of the Japanese management lasted here about a year or two at most, then sent back to Japan for reassignment to other countries,.“Here at Suzuki, us American workers are not to speak directly to them. We must go through our department managers. The Japanese do not make eye contact with anyone, even in passing in the office. Many of us American workers took this as a huge insult. I know I do.”Observers have long criticized Suzuki for their lack of fresh product. Our insider paints a picture of a division starved for product and totally at the mercy of inept and weak management.The latest and current group of Japanese managers were brought in back in May 2011. There sole purpose has been cutting costs and searching only to become profitable, by any means necessary. This lead to a huge lack of any marketing, advertising, or just general word of Suzuki products. American managers, who have been lucky enough to keep their positions, they mostly just agree with whatever the Japanese say, for fear of losing their positions. Anyone who seems to have an opinion other than what the Japanese have is either quickly shunned or later terminated during these layoff periods. They say nothing and just go along with whatever is the plan of the day…they do not have any say in product planning. How it works is they place dealer orders early in the model year and hope that Japan agrees with these numbers. However, they have always been at the mercy of what SMC is willing to produce and ship to the United States.Most of their dealer network is starved for product and parts at this time, and has been for a while. Our insider identifies April 2008 as the begining of the end for ASMC’s car business. Rick Suzuki, chairman of ASMC, admonished the employees for not meeting the 5 year goal of selling half a million cars, despite record sales numbers at the time. Bonuses and raises were suspended, and layoffs were instituted until the division became profitable. The biggest hit for the automotive side seemed to occur on the marketing end By April 2009, we had laid off approximately 15% of our workforce. Layoffs occured in all divisions at that time. By summer of 2010, ASMC had let go of most of their PR/Media Department, and hired Questus as a consultant. However, as you know, there have only been very limited advertising and marketing for most Suzuki products. They did produce a Kizashi Kicks campaign, but with minimal success. The public just didn’t buy a Kizashi was a competitor to higher end luxuy vehicle like Audi and Mercedes that they featured in these commercials and on the website. They did place a Super Bowl ad, but only in about 15 markets, mostly on in the Northeast. The Cash for Clunkers program did help sales at the time, but it was not deemed as a success here by the Japanese. There have been constant rounds of random downsizing since the first layoffs of 2009. Most occur every 6-12 months. Yesterday was the biggest round since April of 2009, with almost 70 people being terminated including the all automotive field representatives.The Japanese consider us to be an automotive company first, everything else is secondary. However, most people can only remember the Samauri. They had no idea that we were even still in business as an auto manufacturer! We only had a 0.02% market share here in America. The main reason was that no one knew us. I doubt today if anyone cares about the chapter 11 filing. Most are probably gonna say to themselves, “Suzuki made cars??”When asked what Suzuki did right over the last 5 years, our insider was characteristically blunt; “Honestly…” he said “dropping the auto division. He continuesThe lack of management and communication here lead many employees to become hopeless about auto. The ones who worked hard and tried to make a difference were treated poorly by the Japanese as well as their immediate managers and either were later terminated or left on their own accord.We should have an even better picture later on, with a eulogy from Suzuki Death Watch founder Mark Stevenson, where even more information from within ASMC will be discussed. It only gets bleaker.This interview has been condensed and edited for clarity

#America #JapaneseCars #Sales #Suzuki #SuzukiDeathWatch

Derek Kreindler

More by Derek Kreindler

Comments

Join the conversation

4 of 30 comments

Oldyak on Nov 06, 2012

one less Japanese car maker here.... No big loss! The Koreans are taking the market anyway. Probably wont be the last! I can see Mitsubishi the next to go and then Subaru.

Like Reply
- Rpol35 on Nov 07, 2012
  
  I would agree with you except that I think Mazda will disappear (at least from U.S. shores) long before Sabaru. Sabaru has nicely created a niche for themselves; I wouldn't say a cult exactly but they have a lot of loyal buyers and their share is holding up. I believe that Mazda's disassociation from Ford will make it more difficult for them to fend off Toynisonda & Korea.
  
  Like
BklynPete on Nov 07, 2012

Subaru is backed by Toyota and they're not going anywhere. I agree that Mazda's long-term prospects aren't good. But my money is on Mitsubishi Motors USA to go muerta. If their USA level of dysfunction still exists like it did when I did, they're doomed. They'll get out of here once they figure out what to do with the Normal, IL plant.

Like Reply
- Freddy M on Nov 07, 2012
  
  Subaru is backed by Fuji Heavy Industry. Toyota owns a stake in FHI, but not a controlling interest.
  
  Like

Recent Comments

Alan As the established auto manufacturers become better at producing EVs I think Tesla will lay off more workers.In 2019 Tesla held 81% of the US EV market. 2023 it has dwindled to 54% of the US market. If this trend continues Tesla will definitely downsize more.There is one thing that the established auto manufacturers do better than Tesla. That is generate new models. Tesla seems unable to refresh its lineup quick enough against competition. Sort of like why did Sears go broke? Sears was the mail order king, one would think it would of been easier to transition to online sales. Sears couldn't adapt to on line shopping competitively, so Amazon killed it.
Alan I wonder if China has Great Wall condos?
Alan This is one Toyota that I thought was attractive and stylish since I was a teenager. I don't like how the muffler is positioned.
ToolGuy The only way this makes sense to me (still looking) is if it is tied to the realization that they have a capital issue (cash crunch) which is getting in the way of their plans.
Jeff I do think this is a good thing. Teaching salespeople how to interact with the customer and teaching them some of the features and technical stuff of the vehicles is important.