GM Buys Out Suzuki In Canada
December 4th, 2009 9:28 AM
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What, GM actually has the money to BUY companies? Suzuki says they want sell the whole shebang in their 50:50 joint venture in Canada to their JV partner, General Motors, says the Nikkei [sub]. That would be the end of a more than 20-year marriage.
Interestingly, Suzuki says they will sell their 50 percent stake in the Ontario-based Cami Automotive Inc. to GM, because GM asked them to. (Of course, there must have been more than a short “Sumimasen, we‘d like our shares back.” “Hai, wakarimashita!”)
According to the Nikkei, the timing of the share sale hasn’t been decided, and mum’s the word on how much GM will shell out for Cami.
Question to the Best & Brightest: Why?
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It's a divorce following Suzuki's fling with Daewoo, which gave us the Verona bastard...
Suzuki is exiting a losing investment. They know they have a gun to the head of Government Motors. GM and Washington (especially the White House) can not afford to be tarred with a visible failure. That's what would happen if Suzuki unilaterally withdrew from the arrangement. That, of course, is exactly what is happening, but the format of a buyout allows GM to position the deal as a bold step forward that underlines GM's confidence in a bright future. In short, this is cosmetics... lipstick on a pig.
Technically if it was a visible failure GM would have walked away from it like they did at Nummi...and Saturn. Suzuki has been stalling adding products at the plant and GM took a lead hand in advancing product development. The J1 and J2 series were ran far too long under 3 badges..Pontiac,Chevy and Suzuki...the M1 through 3 quickly out grew their novelty and nothing was left to fill that "micro" car field. The 190 series platform was an attempt to bridge the gap in mid size SUV's and the Suzuki failed miserably...no one goes to a Suzuki dealership to buy an expensive vehicle..maybe an expensive bike..but not a car. So it is more natural for Suzuki to exit the scene when the plant is being filled to capacity just trying to fill GM orders..there is no space left to add lines other than in the body shop..all this will do is increase the number of vehicles going through to final production. Mr Carpenter..what is the difference between an assembly plant and manufacturing plant?
to : psarhjinian, just to clarify....... So putting up the equinox, which is in the fastest growing and biggest segment, of which there is some inventory, and which GM is expanding production on, is the wrong decision..................... ................While putting up the camaro, "too show the pride", a vehicle that has a very limited appeal to the general public, and is basically sold out, is a better decision ?