While many global automakers incurred huge losses in the 2008 business year, Suzuki Motor Corp.’s limited reliance on the U.S. market and strong foothold in India kept the company in the black.

For the year to March 31, Japan’s second-largest minicar maker logged a ¥76.9 billion group operating profit and a ¥27.4 billion net profit.

Suzuki is one of three carmakers in Japan that eked out a profit, along with Honda Motor Co. and Daihatsu Motor Co.

Its results were in stark contrast to Toyota Motor Corp.’s ¥461.01 billion group operating loss and ¥436.94 billion net loss in the same business year, and the collapse of U.S. auto giants General Motors Corp. and Chrysler LLC.

“Suzuki’s strength comes from its solid earnings base in India and the domestic market,” said Yasuaki Iwamoto, an auto industry analyst at Okasan Securities Co. “It can benefit because of its big market shares.”

Industry analysts have praised Suzuki’s stable business.

“Results surpassed estimates, while in the 2009 financial year management projects profits to spare, once again underlining the solidarity of Suzuki’s earnings,” Takashi Nakanishi, an automobile industry analyst at JPMorgan Securities Japan Co., said in a report released May 11, when Suzuki announced its earnings results.

What makes Suzuki stand out in the slumping auto industry is its success in India, where its subsidiary, Maruti Suzuki India Ltd., has the largest share with 48 percent of all India-made cars, according to Suzuki. Its strength has so far helped it prevail over newcomers such as Toyota, Honda, GM and Ford Motor Co.

The result is “the fruit of its efforts” after Suzuki decided to concentrate its business resources on small cars and aim “to become No. 1 in our strong fields,” Suzuki Chairman and President Osamu Suzuki said in a recently published book.

Its entry in India dates back to 1982, long before the country gained automakers’ attention as one of the most promising and fast-growing new markets. Now, 46 percent of Suzuki’s overall operating profit of ¥76.9 billion comes from Asia, mainly from India.

Another factor that makes Suzuki unique is its focus on minivehicles, analysts said.

Its Wagon R minicar was the nation’s best-selling vehicle in fiscal 2008 for the fifth straight year, according to the Japan Automobile Dealers Association and the Japan Mini Vehicles Association.

Low-priced, fuel-efficient minivehicles with engines of up to 660cc are particularly popular in Japan amid the prolonged economic slump.

Analysts warned, however, that the automaker’s strength might also turn out to be its Achilles’ heel.

“Suzuki’s risk is partially appearing,” Okasan Securities’ Iwamoto said, referring to the increased competition the company’s minicar lineup faces from popular compact cars such as the Honda Fit and Toyota Vitz.

In addition, Suzuki’s dominant market share in India could be eaten into by Tata Motors’ newly unveiled Nano, which was launched in April. The base version of the Nano is priced at 112,000 rupees, or about ¥224,000, about half of Maruti Suzuki’s popular Maruti 800, which costs about 200,000 rupees, or ¥400,000.

“We can’t say there is no influence. But we don’t know yet what kind of car (the Nano) is, so we will wait and see,” Osamu Suzuki said.

The experienced leader insists his company will not enter into price wars with Tata and will stick with its lineup. Okasan Securities’ Iwamoto said Suzuki could slash the price of the Maruti 800 by simplifying the equipment.

Another problem is Suzuki’s lack of new technology.

According to the minicar maker, it has technical tieups with GM to manufacture a V-6 engine and develop fuel-cell cars and hybrids. It has also set up a joint venture with GM in Canada for sport utility vehicles and signed a licensing agreement with Fiat to make diesel engines.

Its tieup with GM started 28 years ago, when GM bought part of Suzuki’s shares. But due to GM’s financial woes, Suzuki later bought back a 17 percent stake in 2006 and the remaining 3 percent in 2008.

“If GM goes into Chapter 11, its projects with GM may face brief confusion,” Koji Endo, an auto industry analyst at Credit Suisse Securities Japan Ltd., said in a recent report. Endo added that he expects the influence on Suzuki’s earnings to be minor.

“Whatever the proceedings will be, GM will continue to manufacture cars. Since we have learned and been taken care of for the past 28 years, we want to continue the trade and the friendship,” Osamu Suzuki said.

Despite the latest healthy earnings results, the 78-year-old Suzuki is well aware of the company’s weak spots and has a strong sense of crisis.

“No company can survive if it is satisfied with its high market share and good earnings results,” he said in his book.

He also said the company’s biggest problem is a lack of human resources, including potential successors.

After stepping down and becoming chairman in 2000, Suzuki returned to the firm’s presidency in December when Hiroshi Tsuda stepped down for health reasons. In 2007, Hirotaka Ono, one of his potential successors and the husband of his daughter, died of cancer at age 52.

“Considering my age, I can’t continue working as chairman and president forever,” wrote Suzuki, who has accumulated 30 years of experience in those posts. “How to select the management team for the next generation has been a big problem for me.”

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