SUZUKI END OEM SUPPLY WITH KAWASAKI
October 14 2005.
Suzuki Motor Corp. will terminate its mutual OEM (original equipment manufacturing) tie-up with Kawasaki Heavy Industries Ltd. as early as 2007, said a Suzuki official yesterday.
The step is being taken because the arrangement is unlikely to boost their sales, partly due to customer confusion of their brands.
Suzuki has so far supplied Kawasaki with large scooters, ATVs and some motorcycle models for sale under Kawasaki's brand name. Kawasaki has supplied Suzuki with MX models and ATVs, among others.
Last year, Suzuki supplied 24,000 vehicles to Kawasaki under the OEM deal while Kawasaki sold 17,000 vehicles to Suzuki.
The mutual supply was a centerpiece of the broader business tie-up agreement reached in 2001 between Suzuki, the third-largest motorcycle maker in Japan, and Kawasaki, the fourth largest.
"The partners will not dissolve other tie-up projects in the agreement," said the official.

Source: The Nihon Keizai Shimbun.