Jump to content
Create New...

Industry News: Suzuki Dealers Are Stuck Between A Rock And A Hard Place


William Maley

Recommended Posts

William Maley

Staff Writer - CheersandGears.com

November 13, 2012

The news of Suzuki automobiles leaving the U.S. has left their dealers with a choice, either take a cash settlement or take Suzuki to court.

Last week, American Suzuki Motor Corporation was authorized by a U.S. Bankruptcy Court to borrow $45 million dollars as part of a settlement with dealers. The settlement would give dealers a cash settlement, and a new contract giving the dealers the rights to operate as parts and service centers for Suzuki vehicles if the dealers voluntary surrender their agreements with Suzuki.

There’s two problems with the settlement. For one, the settlements to be paid out, Suzuki will use dealership sales, rent, vehicles in inventory, and investment in facilities to come up with a amount. This arrangement would cause dealers who didn’t sell that many Suzuki vehicles to get a small amount. Also, dealers who agree with the settlement also agree not to take legal action against Suzuki.

Now, Suzuki dealers can decline the settlement and take the company to court to fight for what they are entitled to thanks to state franchise laws. The franchise laws make Suzuki buyback the dealer’s inventory of new vehicles and parts, and provide compensation for for rent, facility, and other costs.

There’s a problem with this as well because a dealer’s claim could be just worth pennies on the dollar, especially after Suzuki pays its higher-priority creditors.

"If Suzuki had chosen to exit the market and terminate the franchise agreements, it would have been subject to state franchise termination assistance provisions such as buying back vehicle inventory, parts, tools and rent on the dealership facility," said James Moors, NADA's director of franchising and state law.

"NADA would be concerned if Suzuki is attempting to use the bankruptcy process to avoid its obligations to its dealers. NADA is reviewing this proposal and believes that Suzuki dealers should not receive less than what they are entitled to under their franchise agreements and applicable state law," Moors went onto say.

Source: Automotive News (Subscription Required), 2

William Maley is a staff writer for Cheers & Gears. He can be reached at [email protected] or you can follow him on twitter at @realmudmonster.

Related Stories:

Suzuki Vehicles Bid Adieu, Files Chapter 11


View full article

Link to comment
Share on other sites

I feel bad the the Suzuki guys here in Columbus, thgey were fighting the good fight and trying to make a go of it with like zero support....

Wonder how cheaply you can buy a Kisashi right now?

Link to comment
Share on other sites

I feel bad the the Suzuki guys here in Columbus, thgey were fighting the good fight and trying to make a go of it with like zero support....

Wonder how cheaply you can buy a Kisashi right now?

You say Kisashi

I say Geisundeit

:P

Link to comment
Share on other sites

where i wuz at sold a few kizashis for a few ticks under 17 for an AWD S model.

the loyal suzuki customers came out of the woodwork to snatch up the deals when the prices fell.

if there is a dealer with a stick shift kizashi, you will get that dirt cheap. probably an S base stick shift for 14 or 15......a GTS stick if you can find one for maybe 17-18.....

Link to comment
Share on other sites

Join the conversation

You are posting as a guest. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.



×
×
  • Create New...

Hey there, we noticed you're using an ad-blocker. We're a small site that is supported by ads or subscriptions. We rely on these to pay for server costs and vehicle reviews.  Please consider whitelisting us in your ad-blocker, or if you really like what you see, you can pick up one of our subscriptions for just $1.75 a month or $15 a year. It may not seem like a lot, but it goes a long way to help support real, honest content, that isn't generated by an AI bot.

See you out there.

Drew
Editor-in-Chief

Write what you are looking for and press enter or click the search icon to begin your search