Right place, right time
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03/03/2008
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Financial Times
The spectacular growth of vehicle use in India and growing environmental concerns have thrown the spotlight on Suzuki Motor. Suzuki, maker of small cars and motorbikes, may be a minnow compared with its larger Japanese rivals. But at a time when demand for cars is exploding in emerging markets and environmental concerns are making smaller, fuel-efficient cars more popular, its dominant position in the Indian car market and its focus on small cars have put it in the right place at the right time. "There is a great deal of interest in Suzuki,' says Tatsuo Yoshida, auto analyst at UBS in Tokyo. In contrast to Japan's larger carmakers, which depend heavily on the uncertain US market, Suzuki appears, he says, "very well adapted to the times'. Suzuki's present good fortunes are the result of careful planning by Osamu Suzuki, its chairman and son-in-law of the founder. In the 1980s, when other Japanese carmakers were busy building their presence in the US, Mr Suzuki chose to go to India instead. "The company did not have the right cars [for the US market] nor the financial resources,' says a Suzuki representative. But Mr Suzuki also saw the still undeveloped Indian car market as an opportunity for Suzuki, a latecomer in its home market, to stand out. The charismatic Mr Suzuki wanted the carmaker to be number one somewhere. And India, where the government was seeking a partner to make a people's car, was a good candidate. At the same time, Mr Suzuki is likely to have been motivated by his strong desire to do something different from his larger rivals. "On page two of Suzuki's training manual is the commandment not to compete head-on with the large carmakers,' Mr Yoshida says. Suzuki has a 55 per cent share of the Indian market, where its cars