Suzuki to Offer an Off-Road Mini-Vehicle
Suzuki of America Automotive Corp. has announced that it plans to introduce to the American road in November a low-priced, mini-Jeep-type vehicle that analysts say could cost 25% less than its closest U.S. competition and dominate a new niche in the off-road market.
To be called “Samurai,” the vehicle will be a joint venture of giant Suzuki Motor Co. of Japan and U.S. Suzuki Motor Corp., the Brea-based U.S. marketing arm for Suzuki motorcycles.
Suzuki officials say the off-road vehicle--which looks like a slightly compressed Jeep--is the forerunner of a full line of cars the company plans to introduce in the United States within the next three years. Various versions of Suzuki’s latest edition have been made in Japan and sold outside this country for two decades.
Over the past 10 years, the Japanese have made major inroads into U.S. subcompact and even luxury car sales. Now, with the planned U.S. introduction of a low-priced, mini-Jeep-type vehicle in November, industry analysts say Suzuki of America could virtually create a new market niche of small, four-wheel-drive vehicles.
By offering off-road vehicles for less than $6,200, industry analysts say that Suzuki--and potentially a slew of other Japanese auto makers--could beat U.S. auto makers to the punch, again. Just as Japanese subcompact cars cost an estimated $1,500 less than most U.S. counterparts, these mini-vehicles will also cost an average $1,500 to $2,000 less than their closest U.S competitors.
With that kind of price incentive, the “mini-sport utility” market, as it has been dubbed, could grow from sales of 1,000 or 2,000 in 1985, to 40,000 or more by 1990, according to John Hemphill, executive vice president at J.D. Power & Associates, a Westlake Village consulting firm.
In this new category, “I don’t foresee a single domestic entry,” Hemphill said.
Quick in the Market
“The most amazing thing about the Japanese auto makers is how quickly they can capture a market niche,” said Maryann N. Keller, analyst at Vilas-Fischer Associates Ltd., a New York money-management firm. “Suzuki won’t do it alone, but collectively, of course, they (the Japanese) will.” Three other Japanese auto makers, Mitsubishi, Toyota, and Isuzu, sell compact versions of off-road vehicles in this country, but Suzuki’s will be the smallest and least expensive.
The Big Three U.S. auto makers all sell full-sized off-road vehicles. But the company with potentially the most to lose is American Motors Corp., which has long held a lock on the off-road market. But AMC’s Jeeps, which are much more powerful than the Japanese mini-versions, are also far more costly.
“Suzuki may take away some of our lower-end business,” said Tom Peyton, AMC’s assistant manager for the western region, “but it won’t be enough to set us on our ears.”
Peyton said that AMC is designing a smaller Jeep for introduction next summer, but unlike the Japanese versions, he said, it will not sacrifice power. “Suzuki’s is basically more of a toy than a full-range, four-wheel-drive vehicle,” he said.
Can Cruise at 60
“Ours isn’t designed to blow anyone off the road,” responds Jim Driver, Suzuki’s advertising manager, “but you can cruise in it comfortably at 60.” The Suzuki vehicle will be available in both hard top and convertible models, he said.
So intent are Suzuki officials on a successful U.S. debut of the vehicle that the company has budgeted $10 million this year to advertise it in just a handful of markets, including California, Georgia and Florida. Driver said the company hopes to sell 10,000 units this year and up to 30,000 units annually by 1987.
Potential buyers include everyone from pickup truck owners to Yuppies, analysts say.
