American Suzuki Motor Corp. will drop 98 dealers from its U.S. motorcycle and ATV dealer network as part of its Chapter 11 restructuring, a Suzuki official told Powersports Business on Thursday.
“We’re not cutting 200 dealers. Approximately 90 percent of our dealers received a letter that their contract has been assumed by ASMC,” Larry Vandiver, ASMC sales and marketing senior director, said. “It’s all part of our restructuring under Chapter 11 to secure long-term growth of Suzuki.”
All Suzuki dealers should have received their letter of acceptance or rejection, with no further notices being mailed. Rejected dealers have received a buyout amount that is in accordance with their Chapter 11 claim, he said. Suzuki will repurchase all of its existing new products as well as parts from the rejected dealers, with a completion goal of March 31.
Vandiver said that the 98 dealers that were rejected comprised 2.5 percent of the company’s retail sales for the past 12 months. Over the past three years, they’ve accounted for 2.8 percent of Suzuki’s retail sales.
The reduction will leave its U.S. dealer network at 832, Vandiver said.
“It’s a reduction at this time, but Suzuki will be looking at various areas across the U.S. to establish new dealers,” he said.
For specific challenges such as store signage that rejected dealers will face, Vandiver said the company “will be reasonable. We will work with each individual. If there’s a problem with getting signage removed, we’ll work together.”
The cuts were based on performance, not geography, Vandiver said.
“Moving forward over 97 percent of our retail potential remains with Suzuki, and in our world, retail is what matters,” he said. “Sales was only one part of performance. Service, parts, advertising and a lot of different elements also were considered. It was part of a process of looking at overall support of the product.”