Suzuki’s Plans Include Massive Investments in Electrification

Osamu Suzuki, president of Suzuki, has announced that after decades at the Japanese brand’s helm, he will leave his position to hand over the baton to his son, Toshihiro Suzuki. The departure of the 91-year-old executive will bring a series of profound changes in the company’s management, which has already announced a strategic plan for the next five years.

The firm has confirmed that it will invest a trillion yen (slightly more than 7.7 billion euros) in R&D, mainly in electrification. Despite being the fourth-largest automaker in Japan, Suzuki is considerably smaller in size than compatriots like Nissan, so it will deepen its alliance with Toyota to develop hybrid and electric vehicles.

This movement has allowed Suzuki to reduce its average emissions since, at the moment, it does not have any vehicle of this type in its range (its models only have two mild-hybrid systems, 12 volts, and 48 volts, respectively).

As with Mazda and Subaru, Toyota currently owns Suzuki shares. While none of the three brands is wholly owned by a Japanese giant like Daihatsu, their dependence on Toyota’s technology (particularly its powertrains and electric car platforms) is likely to increase in the coming years.

Due to the higher investments, Suzuki will have less operating income during the next five years. “The operating income target is set at 5.5%, down from the previous target of 7%, due to aggressive investment in research and development, for example in electrification, which will amount to 1 trillion yen in five years”.

Suzuki, through its subsidiary Maruti, is the leading sales manufacturer in the Indian market. Everything seems to indicate that its electrification strategy will prioritize that region. “In India, Suzuki will take the initiative to promote the electrification required by society in response to the country’s environmental problems, and will maintain a market share of more than 50% in the passenger car segment.

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