Tarumoto：Suzuki to launch 2.4L car next yr

[Editor's Note] On November 23, 2009 Guangzhou Motor Show Press Day officially started. 50 press conferences were held, more than 70 cars made their debut and 32 concept cars were introduced. The above fact signaled the booming of Chinese car market this year came to a new climax. Major auto brands at home and abroad were fully prepared for Guangzhou Motor Show with their prominent car models. Sohu Auto has interviewed nearly 60 car enterprises chiefs in live studio at Guangzhou Auto Show so that we can report some special news of Guangzhou Auto Show, car models and car enterprises for you. Following is the record interview of Tarumoto Koji, general manager of Suzuki (China) Investment Co., Ltd.

Tarumoto Koji, general manager of Suzuki (China)

Sohu Auto: Does Suzuki have specific advice for channel network?

Tarumoto Koji: We don’t have many new ideas. Our previous sales network was not consistent with Chinese car market. Changan Suzuki and Changhe Suzuki have their own market. Recently we tried a joint sales and the mode will continue to be implemented.

Sohu Auto: Are there any measures to speed up the pace of joint sales?

Tarumoto Koji: Personally I hope that the pace of joint sales could speed up, but in fact we also have to face some practical problems, such as some shops of Changan Suzuki and Changhe Suzuki locate very close, so it will also take us some time to advance the joint sales.

Sohu Auto: Where the distinctions between current sales and the past lie on?

Tarumoto Koji: Basically the sales almost haven’t changed. We mainly place the products of both sides in the first place, and the new idea is maybe to strengthen after-sales service.

Sohu Auto: How Changan Suzuki and Changhe Suzuki were defined in the past?

Tarumoto Koji: This time the parent companies of them combined and there are many possibilities in the future. Changes of some practical problems should be along with the future. We always want to provide Chinese consumers with very good products and better service, actually Suzuki’s original intention would not change with the merger of their parent companies. We hope that this situation could arrive as quickly as possible. Now with the merger of their parent companies, things are relatively easier to be pushed. I have just mentioned the issue of commercial policies and commercial policies have been discussed by the two companies. With the development of us the commercial policies could be much closer and the situation could be smooth.

Sohu Auto: Does Suzuki have taken this opportunity to increase investment in the car? Or does Suzuki have the intention to take this opportunity to upgrade the level of cooperation?

Tarumoto Koji: I have just said Suzuki's policies would not change. In the past few years we have been accelerating the project in China. In different phases we will increase the investment which targets Chinese car market as a whole, in other words, policies will not change with the merger of their parent companies.

Sohu Auto: how about the performance of Suzuki in Chinese car market this year? What’s the expectation for 2010?

Tarumoto Koji: This year's development was well, but the growth rate of Suzuki may be slightly lower than that of the overall market. Because there were no sales of ALTO until August, if we removed the growth rate of ALTO, the figure is still satisfying. Next year with the full sales of ALTO as well as some new models, I am looking forward to a better growth rate next year.

Sohu Auto: How do you view Chinese car market in next year?

Tarumoto Koji: I also want to ask you this question. Frankly speaking it is rather difficult to predict future, however I noticed all industry people and the media comment that Chinese car market could keep a good performance each year so I also expect the performance of next year will be better.

Sohu Auto: Suzuki mainly made small cars in the past and has invested a lot in A-car research. We know you will launch a new mid-size car models, so how about its Chinese name? And could you reveal some bright spots of the mid-size car for us, including technology, models and style?

Tarumoto Koji: Last month we have launched the car at Japan and his Japanese name is ZISSHI. We plan to sell the car in China next year. Detailed configuration of this model hasn’t yet fully established and sales prices are being discussed. According to the Chinese ZISSHI is a good predictor of the future. We have begun to promote this strategic mid-size model and if it could sell well in Chinese car market I will be very pleased. To say in detail, firstly this car is a 2.4L engine and the length of it is about 4.6 meters or so. We are inclined to define the car as Sport Sedan and its Chinese name has not yet been finalized, if you have any good suggestions, we welcome and please tell us.

Sohu Auto: Will it be an imported car or a car made in China?

Tarumoto Koji: In the early it will be an imported car, of course, I also hope the car could be made in China.

Sohu Auto: Which company will in charge of sales of the car, Changan or Changhe Suzuki?

Tarumoto Koji: It also depends on the conditions at that time, and now whether the car could be made in China or not really depends on the sales performance in Chinese car market. We still want to sell it first and if its performance could be well we will consider making it in China. We also hope you can give this car more kind words and we will adjust the plans with development of situation.

Sohu Auto: Now how many countries are selling the car?

Tarumoto Koji: It is only limited to Japan currently.

Sohu Auto: Now Chinese car market is in explosive growth. Does Suzuki have any new products for the market?

Tarumoto Koji: Currently Suzuki has prepared for the market, but I couldn’t tell further detailed information here.

Sohu Auto: Does Suzuki have plans to sell 1L engine of Japan in Chinese car market?

Tarumoto Koji: This also depends on the conditions and circumstances, but the new ALTO is equipped with 1L engine. The new Alto is very fuel-efficient, and now many countries are also introducing hybrids. Compared with Suzuki’s small displacement cars, all hold the opinion that hybrids are the most fuel-efficient vehicles, but we don’t know how much fuel consumption per hundred kilometers of them is. The small cars made by us actually use less materials compared with hybrids. Therefore, we hope consumers could distinguish which is more environmental—friendly.

Sohu Auto: In terms of power, cars of Volkswagen are mainly pushing turbo-charged. And cars of USA and France are also pushing it, how Suzuki views this technology and will you develop this technology?

Tarumoto Koji: First, small displacement engine will be fuel-efficient and in order to increase the output power carmakers use turbo-charged. The technology now is universally accepted by many auto manufacturers and I think it is a fuel-efficient methods .Nevertheless the development direction of it is indeed hard to estimate. In order to pursue fuel-efficient we can lower the emissions, from the large displacement to small displacement is possible.

Sohu Auto: Suzuki does well in small family cars, in your opinion what functions family cars should possess in the future?

Tarumoto Koji: This is a more difficult question to answer and to balance. If we can arrange well this side, and the other side maybe have problems. A car appeals to consumers should possess several good functions, such as fuel economy, style and dynamics. However, we need to develop the cars which enable consumers to enjoy driving pleasure. Hence, in addition to pay attention to factors such as fuel economy, style and so on we also emphasize driving pleasure of our cars.

Sohu Auto: How many cars of Suzuki will be made in China?

Tarumoto Koji: Currently Changan Suzuki is preparing a new development model. Changan Suzuki has also done a variety of efforts to develop new cars, but here I couldn’t reveal much detailed information.

Sohu Auto: Can’t make a specific measurement now?

Tarumoto Koji: Changhe has released SPLASH. The other models I couldn’t say here.

Sohu Auto: What this car’s appearance like, and where its major competitors lie in?

Tarumoto Koji: First of all, the length of this car is 3.7 m -3.8 m and the size of it is just like Swift. Production characteristic of Swift is a strong sense of movement and car owners can enjoy the driving pleasure. SPLASH aims individual users and its height is higher compared with Swift.

Sohu Auto: Whether the traditional products and new products of you will be combined or not?

Tarumoto Koji: It is possible.

Sohu Auto: You talked about joint sales of Changan and Changhe Suzuki. Therefore, is there exists competition between them? How about the dealers’ reaction towards it?

Tarumoto Koji: I have already said the merger of their parent companies wouldn’t have a great impact on Suzuki. We will always adhere to our previous practice and continue to move forward and we hasn’t considered combining the joint brands for joint sales.

Sohu Auto: How about joint sales?

Tarumoto Koji: We will constantly advance the joint sales. Besides we must also strengthen after-sales and accessories service to provide customers with better service. We will continue to promote this thing, and now the merger of the parent companies of Changan and Changhe Suzuki will certainly impact our future development plans.

Sohu Auto: What Suzuki opinion is, promote it positively or keep waiting?

Tarumoto Koji: Suzuki is always concerned about the demands of consumers, in other words, our adjustments mainly base on it. Our priority is to strengthened cooperation of service and auto parts of the two companies so that consumers are satisfied with us.

Sohu Auto: Now SPLASH and Swifts are under the charge of a new group .Since they are all Suzuki and belong to same company, will they be made on a same platform?

Tarumoto Koji: We need to discuss this thing in the future and the production is an important issue for the two companies.

Sohu Auto: Are there such an issue in China?

Tarumoto Koji: After merger of the two parent companies a lot of things could be done more easily. In order to improve production efficiency it is possible for us to deal with it. For Suzuki, the measures taken by us in the future really depend on the development of situation.

Sohu Auto: Will SPLASH be equipped with Swift’s accessories since its production next year?

Tarumoto Koji: Because the two cars were always on the same platform previously, the two companies have begun to discuss the problem of accessories. In order to improve production efficiency such cooperation already exists.

Sohu Auto: Previously it was expensive to buy engines from Chang'an Suzuki. After the merger, will the high cost decline? Whether the remaining issues of Changhe Suzuki could be solved or not?

Tarumoto Koji: First of all, I am not very clear whether it is expensive to purchase engines from Chang'an Suzuki. I didn’t participate in the price discussion of them. Here I want to analyze something for you. Every understands that Changan and Changhe Suzuki are two joint venture companies, so in a same group the transaction prices between them couldn’t be outrageous. Although the inner engine procurement framework will change, I personally think the price will not change. Additionally, I have listened to everyone's question and I understand you are very interested in merger of the two companies. However, for Suzuki although the merger is a major event, Suzuki won’t change our original plans. One thing I could say here is that with merger of the two parent companies, it is easier for us to implement things and it is also a topic for us in the future.

Sohu Auto: Could you describe the future characteristics of Changhe Suzuki, Changan Suzuki, imported Suzuki and Suzuki’s strategies for these three market brands?

Tarumoto Koji: First, we will continue to implement joint sales hoping that under Suzuki each side could cooperate effectively. In the future we will be in accordance with the above direction.

Sohu Auto: Every coin has two sides (advantages and disadvantages).Suzuki sometimes cooperates with one company but sometimes also cooperates with the two companies together, so how to view this phenomenon?

Tarumoto Koji: Auto manufacturers may have a variety of considerations. A joint venture co-brand image is very easy to set up and customers are very clear about your brands, however the division of Suzuki into two joint venture partners could impact sales performance. Regardless of how many joint ventures they must use a same LOGO image of Suzuki to sell cars and this requirement will not change.

Sohu Auto: Suzuki enjoys cooperating with a group?

Tarumoto Koji: This may also rely on the conditions. It is allowed as long as two companies could establish a brand image. If it is difficult to set up a brand image by two companies, a good brand is better, which is associated with the sales performance, so I don’t know which is good.

Sohu Auto: Joint network sales of Changhe Suzuki and Changan Suzuki weren’t put forward recently. Could they achieve the target next year?

Tarumoto Koji: I have just mentioned that we are faced with some problems in the process of implementing joint network sales. Therefore, here I couldn’t predict the future situation of joint network sales. Problem is some shops of Changan and Changhe locate too or there are two stores in a neighbor region. To be more frank, it is possible that relationship between their adjacent shops is not well, hence implementation of joint network sales is not as easy as planned, but we have made some progress and we will continue to move it forward.

Sohu Auto: After merger of the two parent companies, is it possible that Suzuki will become one again?

Tarumoto Koji: The Future is difficult to predict and I really don’t know.

Sohu Auto: Are there some potential conditions for it?

Tarumoto Koji: I couldn’t know your meaning. Now many manufacturers are in cooperation. For example, Suzuki cooperates with the Mazda and Nissan in Japan.

Sohu Auto: We just talked about joint ventures?

Tarumoto Koji: I couldn’t talk about this thing further.

Sohu Auto: Actually joint network sales of the two companies didn’t perform well. Compared with joint network sales, it seems better to improve the sales performance of Changhe Suzuki and Changan Suzuki first, how do you view this matter?

Tarumoto Koji: This is also very important. The premise for joint network sales is that each side could sell their product well before sell other car products. If the above goal couldn’t be achieved the prospect is hard to say.

Sohu Auto: Will Vitara and Jimny to be made in China?

Tarumoto Koji: First of all, things for the future are now very hard to predict. It is possible. Nevertheless in terms of their sales performance in China, it is much difficult to make them in China. If we want to produce them in China the premise is that their sales should be satisfying. (Translator: Qinghua Wade)

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