Kawasaki and Suzuki Sharing

Brent Avis
by Brent Avis
Hot on the heels of last week's GSX-R-powered Kawasaki comes this press release from Kawasaki:
Kawasaki Motors Corp., U.S.A.(KMC), the consumer products marketing arm of Japan-based Kawasaki Heavy Industries, Ltd.(KHI), will soon provide additional information on the announced alliance between KHI and Suzuki Motor Corp. to its U.S. dealer network. The alliance -- created to allow the two brands to share certain production platforms, related sourcing, and engage in selected product co-development -- was announced last August and will begin to take form by the middle of this year.

According to Bob Shepard, KMC Executive Vice President, the alliance planning is "moving along as was anticipated and will, when all details are finalized, be recognized as a significant contributor to the dealer group's growth opportunities beginning in 2002."

Shepard indicated that the initial benefit of the alliance-which is similar to business models employed in the automotive industry-will be...

in the dealers' ability to offer a broadened product line, specifically in regards to off-road and dual-purpose motorcycles, and the fast-growing all-terrain vehicle segment.

He said Kawasaki dealers will be able to offer consumers branded youth and sport ATVs, as well as additional small and mid-sized motorcycles.

"There has been speculation from uninformed sources regarding the extent to which the alliance will affect other segments, and this is unfortunate. When the announcement was first made in Japan, the two companies were very clear that certain models-such as super sports motorcycles-would not fall under the alliance umbrella," said Shepard. He reiterated that and stressed the importance of this strategic business relationship for both brands as they compete in an increasingly global environment.

It is expected that Suzuki will issue similar details of the arrangement to its U.S. dealer group in conjunction with Kawasaki's impending notification. Their announcement will detail the product expansions to the Suzuki line that the alliance generates.

Kawasaki will continue to build on the existing equity in its brand and its individual model name recognition, and will focus on offering consumers the widest-possible choice in product selection.

This will, according to Shepard, be a key component in enhancing profitability for Kawasaki dealers in the future. At the same time, he said, consumers will ultimately be in a position to make the best purchase decisions, and will be able to strengthen their relationships with Kawasaki dealerships which will be positioned to better serve buyers' needs.

The two brands are expected to combine some development efforts to take advantage of efficiencies that otherwise would be absorbed independently, and would necessarily extend the time in bringing new products to market. This is seen as a benefit to consumers who will be able to purchase a broader range of new and updated units that maintain the uniqueness inherent to each brand.

Kawasaki has a proud heritage and this alliance gives us the support needed to continue to build on it as we move forward," said Shepard. "The entire arrangement is predicated on allowing the brands to maintain their respective character and simultaneously increase the impact they have in an increasingly competitive marketplace," he concluded.

The exact timing for Kawasaki's notification to its dealer network will be based on finalization of specific program elements still under consideration.

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Brent Avis
Brent Avis

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