Suzuki Motor Corp. buys out Satya Sheel’s stake in SMIPL

Confirming a move that had been anticipated a few months ago, Suzuki has bought out its partner’s stake in Suzuki Motorcycle India Pvt. Ltd. (SMIPL) Satya Sheel and family, who had partnered with Suzuki for its two-wheeler joint venture in India, have sold their 26% stake to Suzuki for an estimated Rs 190 crore. With this, SMIPL becomes a fully owned subsidiary of Suzuki Motor Corporation (SMC), Japan.

Strangely enough, when Suzuki returned to the Indian two-wheeler market in 2006, it chose to go with Satya Sheel, who was earlier on the board of directors at Maruti Suzuki – not, perhaps, something that immediately qualifies him to head Suzuki’s motorcycle business in the country. In any case, with Sheel at its helm as managing director, SMIPL, which has a very limited product range for the Indian market, has not been able to make much headway in the motorcycles or scooters segments.

Suzuki, which has already invested around Rs 500 crore in setting SMIPL, is said to be looking at investing another Rs 150 crore in its two-wheeler venture in India. The company is also planning to go in for capacity expansion – from the current 175,000 units to 250,000 units per annum – at its manufacturing plant near Gurgaon.

Apart from the Suzuki Heat, Zeus and GS150R motorcycles, and Access scooter, which are manufactured in India, Suzuki has also recently started importing the Hayabusa and Intruder 1800 bikes from Japan, both of which are priced at more than Rs 11 lakh in India. SMIPL, which sold around 85,600 two-wheelers in the April-November period this year, plans to launch new bikes in 2009, in order to expand its market share in the country.

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