General Motors Co. will take over its Canadian carmaking venture with Suzuki Motor Corp., in its second exit this year from a partnership with a Japanese automaker.
Suzuki agreed to sell its entire 50 percent stake in the venture, Cami Automotive Inc., to the Detroit-based carmaker, Suzuki said in a statement today. The statement didn't specify the terms of the transaction.
GM, under U.S. government control, is selling assets after emerging from bankruptcy earlier this year. In June, the company abandoned its car-production venture with Toyota Motor Corp. in Fremont, California. GM ended an equity alliance with Suzuki in November 2008. Suzuki spokesman Hideki Taguchi declined to comment on the timing and the amount of the transaction.
"GM wants to make this plant one of its important production sites, as costs are cheaper in Canada than in the U.S.," said Koji Endo, managing director of Advanced Research Japan, a Tokyo-based equity research company. "For Suzuki it also makes sense as it probably needed to get out of production in the region, where it has very little market share."
Suzuki had 0.2 market share in the U.S. in November, according to data compiled by Bloomberg. Suzuki had halted production of the XL7 sport-utility vehicle at the end of May due to low demand for its vehicles.
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