American Suzuki files bankruptcy, focuses on powersports and marine

American Suzuki Motor Corp. announced late Monday that the company is filing for chapter 11 bankruptcy in a realignment that will focus its future efforts on its motorcycle/ATV and marine divisions, while the company exits the automotive market.

“If you’re a Suzuki powersports dealer and you’re doing the things you’re supposed to be doing, then you have no concern at all with this news,” Larry Vandiver, American Suzuki Motor Corp. sales and marketing senior director, told Powersports Business. “Actually, it’s a really good move for our company in powersports. I’ll probably get blamed for it all because when I started with the company, this is what we really were — we were a motorcycle, ATV and marine company. What will happen over the course of business is all the focus, all the emphasis, from our factory to [Brea, Calif.], will be all about motorcycle, ATV and marine, and how to improve that business, come up with innovative new products and how to take that business forward.”

The immediate future calls for many of the 930 Suzuki motorcycle and ATV dealers in the U.S. to converge on Las Vegas for the company’s Sunday, Nov. 11-Tuesday, Nov. 13 dealer meeting. Suzuki will introduce five new motorcycle models at the meeting. Vandiver said plans call for four models to be introduced in calendar 2013 and four more in 2014.

“Looking at all of those things, we saw nothing but a good bright future, but we needed more dedication with the walls of this facility towards those goals,” he said. “We’re increasing our business, our revenues are good, we’re eking out a profit and we’re happy to say our marine business even through all of the economic downturn continued to be a profit center for us. Now we’re turned the corner in motorcycle and ATV, and every month is improving.”

The following is the press release from American Suzuki:

BREA, Calif. — American Suzuki Motor Corporation (“ASMC” or “the Company”), the sole distributor in the continental United States of Suzuki Motor Corporation (“SMC”) automobiles, motorcycles, all-terrain vehicles and marine outboard engines, today announced that it plans to realign its business to focus on the long-term growth of its Motorcycles/ATV and Marine divisions. Following a thorough review of its current position and future opportunities in the U.S. automotive market, ASMC will wind down and discontinue new automobile sales in the continental U.S. The Company has determined the best path to achieve this realignment in an efficient and orderly manner is to restructure its operations under chapter 11. The case will be filed in the United States Bankruptcy Court, Central District of California in Santa Ana.

Consistent with ASMC’s long history of standing by its products, owners of Suzuki automobiles will be protected. All warranties will continue to be fully honored and automobile parts and service will be provided to consumers without interruption through ASMC’s parts and service dealer network.

ASMC remains firmly committed to Motorcycles/ATV and Marine products, and these divisions are competitively positioned in their respective markets, allowing for long-term growth as economic conditions improve. The realignment is intended to better position ASMC for long-term success and is a return to the Company’s roots in the U.S. market, which began with motorcycles and has grown to include ATV and marine products. ASMC remains very proud of its high quality, high performance motorcycle, ATV and Marine products. The Company will continue to bring ASMC products to market, including its full lineup of sportbike, cruiser, touring, scooter, dualsport, motocross, off-road motorcycles and KingQuad ATV line, as well as its flagship DF300AP, state-of-the-art DF20A, and DF15A, among other models. Additionally, ASMC is working to further build its market share through continued investment in additional support for dealers through marketing and advertising activities and sales promotion. Suzuki will continue to have a strong presence as a sponsor of teams in supercross, outdoor motocross and road racing.

In evaluating its position in the highly regulated and competitive U.S. automotive industry, ASMC determined that its Automotive division was facing a number of serious challenges. These challenges include low sales volumes, a limited number of models in its line-up, unfavorable foreign exchange rates, the high costs associated with growing and maintaining an automotive distribution system in the continental U.S. and the disproportionally high and increasing costs associated with stringent state and federal regulatory requirements unique to the U.S. market. While the decision to discontinue new automobile sales in the U.S. was difficult to make, today’s actions were inevitable under these circumstances. ASMC is dedicated to honoring its commitments to Automotive customers through and after the wind down of new automobile sales in the continental U.S.


An Orderly Process to Serve Consumers

ASMC intends to work within its current U.S. Automotive dealer network to help structure a smooth transition from new automobile sales to exclusively parts and service operations, or, in some instances, an orderly wind down of dealership operations. ASMC intends to market and sell its remaining U.S. automobile inventory through its Automotive dealer network. Through and after the restructuring, all warranties will be fully honored and automobile parts and services will be provided to consumers through the dealer network. ASMC intends to honor any automobile buyback agreements that are currently in place with financial institutions.

As part of its chapter 11 filings, ASMC will submit a proposed Plan of Reorganization and Disclosure Statement that specifies how the Motorcycle, ATV and Marine divisions will be maintained and enhanced, and how its relationship with Automotive dealers will be largely transitioned to support consumers and dealers through continued parts and service operations. SMC or its nominee intends to purchase ASMC’s Motorcycle, ATV and Marine businesses, as well as the Automotive service operation responsible for parts and warranties, through a new U.S. subsidiary that will retain the ASMC brand name.

ASMC believes it has sufficient cash on hand to operate its businesses during the restructuring. If necessary, ASMC will request permission from the Court to borrow additional funds from SMC needed during the restructuring.

Honoring Commitments

ASMC intends to operate its Motorcycles/ATV and Marine businesses as usual and is dedicated to completing the realignment process as smoothly and efficiently as possible. ASMC will continue to fully stand behind all of its products and honor all warranties from these divisions. ASMC is working with GE Capital’s Retail Finance and Commercial Distribution Finance businesses to continue providing motorcycles and ATV consumer financing programs and motorcycle, ATV and marine dealer inventory financing respectively. The Company expects existing agreements with other dealer and consumer financing providers to continue as well.

ASMC has filed a series of first day motions requesting approval to continue paying employee wages and benefits in the ordinary course, offering dealer incentives and payments under customer warranties. ASMC also expects to pay vendors in the normal course of business for goods and services delivered on or after its November 5, 2012 filing. Payments for goods received before ASMC’s November 5, 2012 filing will be made in accordance with the chapter 11 procedure.

SMC, the 100 percent interest holder in ASMC, is not a debtor in the chapter 11 filing.

ASMC’s legal advisor on the restructuring is Pachulski Stang Ziehl & Jones LLP, and its financial advisor is FTI Consulting, Inc. Nelson Mullins Riley & Scarborough LLP is serving as special counsel on automobile dealer and industry issues. Further, ASMC has proposed the appointment of M. Freddie Reiss, Senior Managing Director at FTI Consulting, as Chief Restructuring Officer, and has also added two independent Board members to assist it through this period.

Additional information regarding ASMC’s business realignment can be found at the Company’s website,, or via an information hotline at 1-877-465-4819. Click here for a PDF of a letter ASMC sent to its current customers.


Finally, in a FAQ PDF distributed to its customers, Suzuki posted the following questions related to motorcycles/ATV and marine:

How will the realignment and chapter 11 process affect American Suzuki motorcycle, ATV and marine product owners?

We will continue to fully stand behind all of our products and all warranties will be honored — just as they have for the past four decades in this country.

We remain firmly committed to our motorcycles, ATV and marine products.  Through our realignment, we intend to work closely with, and continue to support, our nationwide network of dealers and the many consumers who have embraced these products since Suzuki’s beginnings in California in the 1963. U.S. consumers will continue to enjoy the full line-up of Suzuki motorcycles, ATVs and outboard motors.

Does this affect my motorcycle, ATV, or marine product warranty?

We intend to honor warranties and provide parts and service will continue uninterrupted ­— just as we always have.


  1. In Canada, province of Québec, we see only publicity for a SUV model vehicule. What is happening with the other models… Thank you.

  2. Luc,
    I actually read a story yesterday that Suzuki Canada will continue selling automobiles. Here’s the link to it:

    — Liz Hochstedler, Associate Editor, Powersports Business

  3. Well there you have it. Parent company goes BK so it can get rid of the dealers, both auto and POWERSPORTS it deems unworthy. Then forms a “NEW COMPANY” run by the same people out of the same offices selling the same product. Sound like something you have heard of before? Can you say Chrysler / GM? The fact that something like this happens is just wrong. The parent company has money to start another corporation but not run the old one? Our government started a scary trend when they scripted the 09′ auto fiasco when it comes to the dealer body, Dealers are independent businesses that consider a franchise an asset and it should be treated as such. Chrysler dealers got ZERO compensation and were left with all their parts, tools and vehicles, to bad they are your inventory, do with it what ever you can. The Suzuki dealers were LUCKY to get what they did, if you can call that luck. How do I know these things? I was one of the UNLUCKY Jeep dealers

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