Suzuki signals change with new president, strategy

SUZUKI Motor Corporation has revealed a new five-year mid-term management plan that will bring an influx of new models and an expected global sales increase of 18.4 per cent, reaching 3.4 million units per annum by the start of next decade.

Dubbed ‘Suzuki Next 100’ in reference to the company’s 100th anniversary in 2020, the plan includes the establishment of a new management structure – including an apparent successor for long-serving chairman Osamu Suzuki – and, with its automotive business, the introduction of 20 all-new or upgraded models globally.

The latter will continue to focus primarily on mini-cars through to light-sized and traditional small C-segment models, as well as SUVs, “to correspond to the expanding global compact car market”.

Specific models in development include an all-new light-sized hatchback based on the iK-2 concept shown in Geneva in March. A crossover based on the iM-4 concept is also anticipated, joining Suzuki’s SUV range that will include the all-new Vitara from September.

At the helm of the company for the past 37 years and one of the longest-serving leaders of any major global car-maker, 85-year-old Osamu Suzuki this week ceded his title of president to his son, 56-year-old Toshihiro, but will stay on as chairman and chief executive officer.

Holding a string of production, engineering and key international positions over many years, Toshihiro was most recently executive vice-president, supporting his father across various aspects of the business and taking specific responsibility for global marketing.

He is now charged with driving the company forward as it battles to maintain its share in the domestic Japanese market while growing significantly in other parts of Asia – particularly India – and in Europe.

In its new plan, Suzuki aims to increase worldwide sales from 2.87 million in the 2014/15 financial year (ending March 31, 2015) to 3.4 million in FY2019, ending March 2020.

While its Japanese domestic share is expected to erode – down from 760,000 units last financial year to 700,000 in 2020 (including a drop to 650,000 this year) – substantial growth is anticipated in other parts of Asia, particularly India, where Suzuki plans to secure more than 45 per cent of the passenger car market.

The company is aiming for 2.2 million sales in the Asian region (excluding Japan) by 2020 – up from 1.72 million last financial year – while Europe is expected to climb to 280,000 units (up from 200,000).

‘Other regions’, which includes Australia but not the United States (from which it withdrew in 2012), is expected to account for 220,000 units in total, up from 200,000 in FY2014.

In doing so, and while increasing motorcycle sales along the way (from 1.76 million to 2.0 million over the period), Suzuki aims to boost its annual sales revenue to ¥3.7 trillion ($A39.24 billion) – up from ¥3.01 trillion ($A31.98b) last financial year.

Annual research and development expenses will increase from ¥125.9 billion ($A1.35b) last financial year to ¥200 billion ($A2.12b) by 2020, with priorities to include the consolidation of vehicle platforms and a concentration of resources on petrol engine development.

Its production bases for global cars will be Japan, India, Indonesia, Thailand and Hungary.

Pundits expect that Suzuki will need to strike a new joint-venture partnership for it to achieve its goals, following the breakdown of its alliance with Volkswagen AG.