Suzuki Motor Corp. has ended one of its two passenger vehicle joint ventures in China with the transfer of a 46 percent interest in Changhe Suzuki Automobile Co. to local partner Changhe Automobile.
The Japanese automaker made the move after the partnership failed to meet sales targets in recent years, Suzuki said in a statement last week.
Okaya & Co., a Japanese electronics company, also transferred the 3 percent stake it held in Changhe Suzuki to Changhe Auto, according to Suzuki.
Changhe Suzuki was established in 1994 in Jingdezheng in east China's Jiangxi province as a 51-46-3 partnership between Changhe Auto, Suzuki and Okaya. It produced and distributed small sedans, crossovers and mini buses under the Suzuki brand, with annual production capacity of 200,000 vehicles.
With consumer demand increasingly migrating to crossovers and SUVs from small vehicles, Changhe Suzuki's sales have dropped to a trickle. In the first four months of the year, the company only sold 5,301 vehicles, according to the China Association of Automobile Manufacturers.
Suzuki also operates a Chinese joint venture with Changan Automobile Co. in the southwest China municipality of Chongqing.
Sales at Changan Suzuki, which is evenly owned by Suzuki and Changan, have also been stuck in a downward spiral in recent years. In the first four months, deliveries plunged 51 percent year on year to below 16,800 vehicles.