Suzuki Oz sour on GM Daewoo deal

SUZUKI Motor Corporation has back-pedalled on an agreement to provide Australia with a medium-sized passenger car, forcing the local operation to concentrate on its next generation four-wheel drives to build sales momentum.

Suzuki Australia general manager automobiles, David Le Mottee, said he was disappointed with the arrangement the Japanese mini-car giant had struck with GM Daewoo, which now sees fast-tracked medium-sized cars being sold under the Suzuki banner in North America but hands the South Korean manufacturer exclusive rights to such vehicles in Australia.

Suzuki has a 15 per cent stake in GM Daewoo. Holden holds the greatest share with 42.1 per cent.

"It is a very sore point," Mr Le Mottee said.

"Daewoo products are sold as either Suzukis or Chevrolets in America but we can’t get access to those products because part of the arrangement is that GM Daewoo sells those products (in Australia). They have an exclusive arrangement." Mr Le Mottee said he had urged his superiors to consider the importance for Suzuki Australia of vehicles such as the Daewoo Magnus-based Suzuki Verona soon on sale in the US and the Daewoo Lacetti bound for Australia in the coming months.

"I said couldn’t they just put a different front guard on it (Lacetti), a bonnet profile, a different grille and call it something else? And they said, no, I can’t do that," Mr Le Mottee said. "Apparently Europe has asked them the same thing." Still vowing to raise Suzuki’s annual sales volume in Australia from a forecasted 7200 units in 2003 to 16,000 in 2006, Mr Le Mottee said his management team would now concentrate its efforts on Suzuki’s four-wheel drive stable.

He has secured more marketing expenditure from Japan HQ for this purpose, however significant growth is not expected until the new generation Grand Vitara arrives in the first quarter 2005 and an all-new XL-7 and a compact cross-over four-wheel drive emerge about 12 months later.

This cross-over wagon has bumped the proposed mini-MPV from the drawing board and will be built on the so-called A-platform shared with Fiat in Europe and which will underpin the next generation Ignis.

Mr Le Mottee said he had received assurances from Suzuki HQ that the cross-over would be smaller in overall dimensions and engine size to Grand Vitara and be able to be priced well below the all-important small four-wheel drive.

"It has elements of the new Volvo four-wheel drive (XC90), the new Forester, even the Cruze in it," he said. "It’s all about a macho-looking wagon." Suzuki Australia might have to contend with Fiat selling its version in Australia. But Mr Le Mottee insisted Holden would not be able to muscle in and use the cross-over as a replacement for the Ignis-based Cruze, a car the Australian Suzuki MD expects to "fall off the perch" when the all-new Ignis – a three-door and five-door hatch based on the Concept S show car – arrives in September next year.

"All our product planning for all our cars are unique to our market," he said.

"I asked the question, ‘Are any of the cars that are coming likely to be shared with GM and Holden?’ And their answer was ‘No’.

"If there is GM product, I think it’s got to be uniquely GM and (we) won’t share it at all. It’s not like the old days of the Swift and the Barina – the same cars with different badges on it. I’ve been led to believe that is not going to happen." The other vehicle crucial to Suzuki Australia’s volume aspirations will be the Liana passenger car, an update for which will bring a revised interior and a 1.8-litre engine next year before a bigger, more powerful all-new model arrives in 2006.

"Liana is where we’ve suffered. That car just hasn’t performed at what we thought it would," Mr Le Mottee said.

WHAT’S COMING FROM SUZUKI
Liana update – First quarter 2004
All-new Ignis – September 2004
All-new Grand Vitara – First quarter 2005
All-new Carry Van – First quarter 2005
All-new Ignis Sport – September 2005
All-new XL-7 – 2006
Liana replacement – 2006
Small cross-over wagon – 2006 SUZUKI SALES FORECAST
2003 – 7200
2004 – 8500
2005 – 11,500
2006 – 16,000