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Aug 30, 2001

Nobody Knows What Effect Announced Kawasaki-Suzuki Cooperation Will Have

Kawasaki and Suzuki have announced that the companies will work together in the future, in the areas of design, development and production of motorcycles and ATVs. Exactly what that means--and what effect the cooperation will have on the product lines and racing activities of the two companies--is unknown.<BR><BR>Each company issued press releases on Wednesday, August 29, and while the majority of the content of the releases was very similar, Kawasaki's press release made the point that each company will continue to go its own way in the development of large-displacement sportbikes.<BR><BR><BR>Suzuki's release read:<BR><BR>"Suzuki Motor Corporation and Kawasaki Heavy Industries, Ltd. today announced an agreement to form a strategic business relationship in the areas of product development, design, engineering, manufacturing of motorcycle and ATV products and purchasing components.<BR><BR>"Based in the spirit of reciprocity, equality, and combining resources, the agreement is designed to make Suzuki's and Kawasaki's motorcycle business more profitable despite increasing globalization and intensifying competition.<BR><BR>"Both companies will collaborate in the area of product development, OEM supply of product, commonizing parts and components, and joint purchasing and manufacturing, so that the competitiveness and profitability of their motorcycle business can be improved. The first step will be to combine resources and create immediate synergy with the cruiser, scooter, motocross and ATV lines. Suzuki and Kawasaki will preserve autonomy in the area of marketing and sales, with each company using its own brand and sales network as before.<BR><BR>"Both companies expect that this agreement will help them respond to the variety of customer needs and to contribute to the healthy growth of the industry."<BR><BR><BR>Kawasaki's statement was worded a little differently:<BR><BR>"Kawasaki Heavy Industries, Ltd. and Suzuki Motor Corporation have agreed to join forces in the development, procurement and production of motorcycles and ATVs.<BR><BR>"The alliance is expected to strengthen the companies' global motorcycle and ATV businesses through combining resources. It will allow production of more new and improved models for our customers at competitive prices.<BR><BR>"Kawasaki and Suzuki will each continue to maintain their own brands, completely separate and independent from each other. We will each market and sell only our brand motorcycles and ATVs through our respective dealer networks.<BR><BR>"The companies will begin utilizing each others' expertise for cruiser, scooter, motocross and ATV models. Each company will continue its independent development of large displacement sportbikes.<BR><BR>"Kawasaki feels that through this alliance we will be able to better meet the varying needs and expectations of our customers and more strongly compete in the global motorcycle and ATV industries.<BR><BR>"Kawasaki Motors Corp., U.S.A."<BR><BR><BR>At post time, Suzuki and Kawasaki spokesmen had not returned phone calls requesting comment, but Yamaha's Brad Banister said, "The marketplace is really competitive right now. The market in America is still strong, but things are getting tight in Europe and Japan. So everybody has a close eye on the bottom line."<BR><BR>A Honda spokesman declined to make any comment.<BR><BR>While motorcycle manufacturers prepare to unveil their 2002 models at various dealer conventions and international motorcycle shows during the coming weeks, the first offspring of the Kawasaki/Suzuki cooperation most likely would not be seen until 2003 or 2004 at the earliest.