Suzuki Hungary returns to two-shift production

The Hungarian unit of Japanese carmaker Suzuki Motor Corp returns to two-shift production this December from one shift, CEO Ryoichi Oura has announced, adding that the serial production of the new Vitara model will be launched in January next year.

The top-of-the line, low-emission, four-wheel-drive new Vitara model will hit the markets in the spring of 2015 and will be exported to every market of the parent company. Suzuki has not yet revealed how many units they are planning to manufacture a year but said they have high hopes for the new model that has been in preparation for over two years now. The company spent a total of EUR 150-160 million on this project.

Suzuki’s Esztergom-based unit (northern Hungary) is one of the major auto companies that form the backbone of Hungary's industrial production and is one of the country's biggest exporters.

Suzuki Hungary switched to a single-shift operation in the autumn as it ceased output of the Splash and SX4 models – only produces two models, S-Cross and Swift –, preparing for the January launch of the new Vitara model. The company maintains its target of 150,000 cars manufactured in 2014. It exports to about 60 countries, but its main market remains the European Union, according to sales director Róbert Krisztián.

The medium-term plan is to export to over 100 countries and about 30% of the cars manufactured in Hungary to be shipped outside Europe. He also notes that Hungarian dealerships have sold about 5,000 Suzuki models this year, 27% more than in 2013, whereas the market expanded only by about 20%. The brand’s market share is currently 7.4% in Hungary. 70% of the cars are sold to businesses and 30% to private buyers.

According to the earnings report of Magyar Suzuki Zrt. published last June, the company posted EUR 1.567 million sales revenues in 2013, which corresponded to a 11.6% year-on-year growth.

According to the financial website portfolio.hu, Suzuki’s announcement is interesting also because it confirms that the feeble industrial production data in August-September were partly related to the scaled back production in Esztergom.

Returning to two-shift production in December can be regarded as good news that higher output will be reached not only in early 2015 but already in December. It is likely, though, that in the period of production, suspensions this will have only a symbolic impact and will be reflected only moderately in the IP data.