Suzuki files for Chapter 11 protection, no more U.S. car sales

What can I say. I saw this train wreck happening 2 years ago. American Suzuki Motor Corporation announced late this afternoon that it was filing for chapter 11 bankruptcy protection. According to their press release, this is being done in order to realign the company to focus more towards their motorcycle, ATV, and marine operations.

As part of the wind down operations, ASMC will discontinue all U.S. automobile sales. However, unlike Saab's bankruptcy, all warranties will be honored for owners. Suzuki, states that "low sales volumes, a limited number of models in its line-up, unfavorable foreign exchange rates, the high costs associated with growing and maintaining an automotive distribution system in the continental U.S. and the disproportionally high and increasing costs associated with stringent state and federal regulatory requirements unique to the U.S. market." as the reasoning behind their decisions. I am curious as to why it has taken them this long to reach that decision as their sales performance has been slipping for the last several years. Their marketing was at times puzzling, comparing the Kizashi against cars like the Mercedes C class and Audi A4.

As we receive more details about Suzuki, we'll keep you updated here. 

Source: American Suzuki Motor Corporation.

Press release:

American Suzuki Motor Corporation ("ASMC") Announces Restructuring and Realignment to Focus on Motorcycles/ATV and Marine Divisions

ASMC to wind down and discontinue new automobile sales in continental U.S.
Consumers will be protected and all warranties will continue to be fully honored

BREA, Calif.--(BUSINESS WIRE)-- American Suzuki Motor Corporation ("ASMC" or "the Company"), the sole distributor in the continental United States of Suzuki Motor Corporation ("SMC") automobiles, motorcycles, all-terrain vehicles and marine outboard engines, today announced that it plans to realign its business to focus on the long-term growth of its Motorcycles/ATV and Marine divisions. Following a thorough review of its current position and future opportunities in the U.S. automotive market, ASMC will wind down and discontinue new automobile sales in the continental U.S. The Company has determined the best path to achieve this realignment in an efficient and orderly manner is to restructure its operations under chapter 11. The case will be filed in the United States Bankruptcy Court, Central District of California in Santa Ana.

Consistent with ASMC's long history of standing by its products, owners of Suzuki automobiles will be protected. All warranties will continue to be fully honored and automobile parts and service will be provided to consumers without interruption through ASMC's parts and service dealer network.

ASMC remains firmly committed to Motorcycles/ATV and Marine products, and these divisions are competitively positioned in their respective markets, allowing for long-term growth as economic conditions improve. The realignment is intended to better position ASMC for long-term success and is a return to the Company's roots in the U.S. market, which began with motorcycles and has grown to include ATV and marine products. ASMC remains very proud of its high quality, high performance motorcycle, ATV and Marine products. The Company will continue to bring ASMC products to market, including its full lineup of sportbike, cruiser, touring, scooter, dualsport, motocross, off-road motorcycles and KingQuad ATV line, as well as its flagship DF300AP, state-of-the-art DF20A, and DF15A, among other models. Additionally, ASMC is working to further build its market share through continued investment in additional support for dealers through marketing and advertising activities and sales promotion. Suzuki will continue to have a strong presence as a sponsor of teams in supercross, outdoor motocross and road racing.

In evaluating its position in the highly regulated and competitive U.S. automotive industry, ASMC determined that its Automotive division was facing a number of serious challenges. These challenges include low sales volumes, a limited number of models in its line-up, unfavorable foreign exchange rates, the high costs associated with growing and maintaining an automotive distribution system in the continental U.S. and the disproportionally high and increasing costs associated with stringent state and federal regulatory requirements unique to the U.S. market. While the decision to discontinue new automobile sales in the U.S. was difficult to make, today's actions were inevitable under these circumstances. ASMC is dedicated to honoring its commitments to Automotive customers through and after the wind down of new automobile sales in the continental U.S.

An Orderly Process to Serve Consumers
ASMC intends to work within its current U.S. Automotive dealer network to help structure a smooth transition from new automobile sales to exclusively parts and service operations, or, in some instances, an orderly wind down of dealership operations. ASMC intends to market and sell its remaining U.S. automobile inventory through its Automotive dealer network. Through and after the restructuring, all warranties will be fully honored and automobile parts and services will be provided to consumers through the dealer network. ASMC intends to honor any automobile buyback agreements that are currently in place with financial institutions.

As part of its chapter 11 filings, ASMC will submit a proposed Plan of Reorganization and Disclosure Statement that specifies how the Motorcycle, ATV and Marine divisions will be maintained and enhanced, and how its relationship with Automotive dealers will be largely transitioned to support consumers and dealers through continued parts and service operations. SMC or its nominee intends to purchase ASMC's Motorcycle, ATV and Marine businesses, as well as the Automotive service operation responsible for parts and warranties, through a new U.S. subsidiary that will retain the ASMC brand name.

ASMC believes it has sufficient cash on hand to operate its businesses during the restructuring. If necessary, ASMC will request permission from the Court to borrow additional funds from SMC needed during the restructuring.

Honoring Commitments
ASMC intends to operate its Motorcycles/ATV and Marine businesses as usual and is dedicated to completing the realignment process as smoothly and efficiently as possible. ASMC will continue to fully stand behind all of its products and honor all warranties from these divisions. ASMC is working with GE Capital's Retail Finance and Commercial Distribution Finance businesses to continue providing motorcycles and ATV consumer financing programs and motorcycle, ATV and marine dealer inventory financing respectively. The Company expects existing agreements with other dealer and consumer financing providers to continue as well.

ASMC has filed a series of first day motions requesting approval to continue paying employee wages and benefits in the ordinary course, offering dealer incentives and payments under customer warranties. ASMC also expects to pay vendors in the normal course of business for goods and services delivered on or after its November 5, 2012 filing. Payments for goods received before ASMC's November 5, 2012 filing will be made in accordance with the chapter 11 procedure.

SMC, the 100 percent interest holder in ASMC, is not a debtor in the chapter 11 filing.

ASMC's legal advisor on the restructuring is Pachulski Stang Ziehl & Jones LLP, and its financial advisor is FTI Consulting, Inc. Nelson Mullins Riley & Scarborough LLP is serving as special counsel on automobile dealer and industry issues. Further, ASMC has proposed the appointment of M. Freddie Reiss, Senior Managing Director at FTI Consulting, as Chief Restructuring Officer, and has also added two independent Board members to assist it through this period.

Additional information regarding ASMC's business realignment can be found at the Company's website, www.suzuki.com, or via an information hotline at 1-877-465-4819.

Legendary daredevil Evel Knievel dead at 69

Another tragic loss to our motor loving society. Today we lost legendary daredevil Robert Craig "Evel" Knievel. His career is known to millions around the world with his motorcycle jumps and rocket powered hi jinks. His legend will be forever remembered, and likely never challenged. We're off to pay homage by trying to have our Snake Rive Canyon motorcycle jump over the couch. God bless Evel and God Speed!

Source: Yahoo.

CLEARWATER, Fla. - Evel Knievel, the red-white-and-blue-spangled motorcycle daredevil whose jumps over crazy obstacles including Greyhound buses, live sharks and Idaho's Snake River Canyon made him an international icon in the 1970s, died Friday. He was 69.

Knievel's death was confirmed by his granddaughter, Krysten Knievel. He had been in failing health for years, suffering from diabetes and pulmonary fibrosis, an incurable condition that scarred his lungs.

Knievel had undergone a liver transplant in 1999 after nearly dying of hepatitis C, likely contracted through a blood transfusion after one of his bone-shattering spills. He also suffered two strokes in recent years.

Longtime friend and promoter Billy Rundle said Knievel had trouble breathing at his Clearwater condominium and died before an ambulance could get him to a hospital.
"It's been coming for years, but you just don't expect it. Superman just doesn't die, right?" Rundle said.

Immortalized in the Washington's Smithsonian Institution as "America's Legendary Daredevil," Knievel was best known for a failed 1974 attempt to jump Snake River Canyon on a rocket-powered cycle and a spectacular crash at Caesar's Palace in Las Vegas. He suffered nearly 40 broken bones before he retired in 1980.

"I think he lived 20 years longer than most people would have" after so many injuries, said his son Kelly Knievel, 47. "I think he willed himself into an extra five or six years."
Though Knievel dropped off the pop culture radar in the '80s, the image of the high-flying motorcyclist clad in patriotic, star-studded colors was never erased from public consciousness. He always had fans and enjoyed a resurgence in popularity in recent years.

His death came just two days after it was announced that he and rapper Kanye West had settled a federal lawsuit over the use of Knievel's trademarked image in a popular West music video.

Knievel made a good living selling his autographs and endorsing products. Thousands came to Butte, Mont., every year as his legend was celebrated during the "Evel Knievel Days" festival, which Rundle organizes.

"They started out watching me bust my ass, and I became part of their lives," Knievel said. "People wanted to associate with a winner, not a loser. They wanted to associate with someone who kept trying to be a winner."

For the tall, thin daredevil, the limelight was always comfortable, the gab glib. To Knievel, there always were mountains to climb, feats to conquer.

"No king or prince has lived a better life," he said in a May 2006 interview with The Associated Press. "You're looking at a guy who's really done it all. And there are things I wish I had done better, not only for me but for the ones I loved."

He had a knack for outrageous yarns: "Made $60 million, spent 61. ...Lost $250,000 at blackjack once. ... Had $3 million in the bank, though."

He began his daredevil career in 1965 when he formed a troupe called Evel Knievel's Motorcycle Daredevils, a touring show in which he performed stunts such as riding through fire walls, jumping over live rattlesnakes and mountain lions and being towed at 200 mph behind dragster race cars.

In 1966 he began touring alone, barnstorming the West and doing everything from driving the trucks, erecting the ramps and promoting the shows. In the beginning he charged $500 for a jump over two cars parked between ramps.

He steadily increased the length of the jumps until, on New Year's Day 1968, he was nearly killed when he jumped 151 feet across the fountains in front of Caesar's Palace. He cleared the fountains but the crash landing put him in the hospital in a coma for a month.

His son, Robbie, successfully completed the same jump in April 1989.

In the years after the Caesar's crash, the fee for Evel's performances increased to $1 million for his jump over 13 buses at Wembley Stadium in London — the crash landing broke his pelvis — to more than $6 million for the Sept. 8, 1974, attempt to clear the Snake River Canyon in Idaho in a rocket-powered "Skycycle." The money came from ticket sales, paid sponsors and ABC's "Wide World of Sports."

The parachute malfunctioned and deployed after takeoff. Strong winds blew the cycle into the canyon, landing him close to the swirling river below.

On Oct. 25, 1975, he jumped 14 Greyhound buses at Kings Island in Ohio.

Knievel decided to retire after a jump in the winter of 1976 in which he was again seriously injured. He suffered a concussion and broke both arms in an attempt to jump a tank full of live sharks in the Chicago Amphitheater. He continued to do smaller exhibitions around the country with his son, Robbie.

Many of his records have been broken by daredevil motorcyclist Bubba Blackwell.
Knievel also dabbled in movies and TV, starring as himself in "Viva Knievel" and with Lindsay Wagner in an episode of the 1980s TV series "Bionic Woman." George Hamilton and Sam Elliott each played Knievel in movies about his life.

Evel Knievel toys accounted for more than $300 million in sales for Ideal and other companies in the 1970s and '80s.

Born Robert Craig Knievel in the copper mining town of Butte on Oct. 17, 1938, Knievel was raised by his grandparents. He traced his career choice back to the time he saw Joey Chitwood's Auto Daredevil Show at age 8.

"The phrase one-of-a-kind is often used, but it probably applies best to Bobby Knievel," said former U.S. Rep. Pat Williams, D-Mont., Knievel's cousin. "He was an amazing athlete... He was sharp as a tack, one of the smartest people I've ever known and finally, as the world knows, no one had more guts than Bobby. He was simply unafraid of anything."

Outstanding in track and field, ski jumping and ice hockey at Butte High School, Knievel went on to win the Northern Rocky Mountain Ski Association Class A Men's ski jumping championship in 1957 and played with the Charlotte Clippers of the Eastern Hockey League in 1959.
He also formed the Butte Bombers semiprofessional hockey team, acting as owner, manager, coach and player.

Knievel also worked in the Montana copper mines, served in the Army, ran his own hunting guide service, sold insurance and ran Honda motorcycle dealerships. As a motorcycle dealer, he drummed up business by offering $100 off the price of a motorcycle to customers who could beat him at arm wrestling.

At various times and in different interviews, Knievel claimed to have been a swindler, a card thief, a safe cracker, a holdup man.

Evel Knievel married hometown girlfriend, Linda Joan Bork, in 1959. They separated in the early 1990s. They had four children, Kelly, Robbie, Tracey and Alicia.

Robbie Knievel followed in his father's footsteps as a daredevil, jumping a moving locomotive in a 200-foot, ramp-to-ramp motorcycle stunt on live television in 2000. He also jumped a 200-foot-wide chasm of the Grand Canyon.

Knievel lived with his longtime partner, Krystal Kennedy-Knievel, splitting his time between their Clearwater condo and Butte. They married in 1999 and divorced a few years later but remained together. Knievel had 10 grandchildren and a great-grandchild.