Suzuki Won't Provide Floorplanning Support to Dealers

Suzuki's dealerships won't get floorplanning financing

Although reports regarding the global economic crisis are clearly fewer after the Detroit 3 group received government support, non-US companies continue their race for money and announce new cost-cutting measures meant to keep them above the floating line of the automotive industry. And the best example comes straight from Japan, with the well-known carmaker Suzuki Motor Corp. denying the dealerships' requests to provide support for floorplanning.

According to a report issued by Autonews, Suzuki announced the decision in a letter sent to dealerships on December 20, explaining that the company “is forced to abandon” floorplanning financing and advise dealers to seek for other sources.

Suzuki's first sign that floorplaning financing may get on the wrong way was unveiled in September when the Japanese company said in a meeting in San Antonio that the automaker was seeking for alternative source of floorplanning support, but only a few details were actually provided. Due to the financial recession, the situation got even worse, Suzuki explained in the letter.

"The economic crisis has deepened, credit has grown tighter than ever, and our own financial performance has deteriorated both within the U.S. and globally," Autonews quoted Kevin Saito, president of American Suzuki Motor Corp., as saying.

Some dealerships have already requested floorplanning financing from other banks, including Ford Motor Credit Co and GMAC, Roy Greenblatt, chairman of the Suzuki Dealer Advisory Board, was quoted as saying by the same source, but others are still struggling to find support.

Suzuki's sales in the United States were down 46.3 percent in November 2008 when compared to the same month of the last year, which means the Japanese company delivered approximately 3,210 units.