Suzuki profits surge on Indian demand amid tie-up with Toyota

Japan's fourth-largest car maker gains from strong demand in India which mitigated slowing sales in its domestic market and other Asian countries.

The Japanese car maker’s Indian subsidiary, Maruti Suzuki, helped to boost Suzuki’s overall profits in the third quarter. Dibyangshu sarkar / AFP

Suzuki Motor on Monday reported a higher than expected rise in third-quarter operating profit on the back of better margins, while sales remained strong in its biggest market of India.

Japan’s fourth-largest car maker said operating profit rose to ¥51.9 billion (Dh1.69bn) in October-December, up from ¥45.1bn a year prior and exceeding a median forecast of ¥43.66bn drawn from 10 analysts in a Reuters poll.

It kept its full-year profit forecast of ¥145bn unchanged, slightly lower than a median forecast of ¥147.78bn drawn from 10 analysts.

Suzuki, which specialises in ultra-compact cars, has benefited from strong demand for its higher-margin vehicles in India, where it has its Maruti Suzuki subsidiary, which accounts for around half of its total global sales. This has offset slower sales at home and in other Asian regions.

Also on Monday, Toyota and Suzuki, which began discussing a partnership in October, said they would work together in ecological and safety technology – a rapidly growing area in the industry.

Toyota, the maker of the Camry saloon, Prius hybrid and Lexus luxury models, and Suzuki announced the decision, following approval by the company boards, and signed a memorandum of agreement, both sides said.

Another area for possible collaboration is information technology as well as supplying each other with products and components. The next step would be to come up with specific cooperation projects, they said.

Suzuki does not have a hybrid, electric car or fuel cell vehicle in its lineup. Self-driving cars are also a growing focus in the industry.

The Toyota president Akio Toyoda praised Suzuki’s pioneer spirit. “I am truly thankful for having been given this opportunity to work together with a company such as Suzuki, which overflows with the spirit of challenge. Toyota looks forward to learning much,” he said.

* Agencies

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