Suzuki Motor profits down by two-thirds

Japan's Suzuki Motor Corp said Monday that its net profit slumped by about two-thirds in the year to March but it managed to stay in the black due to relatively robust demand in India. The manufacturer of small cars and motorcycles suffered a 65.8 percent drop in annual net profit to 27.43 billion yen (278 million dollars) as the global economic downturn depressed demand and pushed up the value of the yen.
Operating profit slumped 48.5 percent to 76.93 billion yen while revenue declined 14.2 percent to 3.00 trillion yen. Less severely affected by the economic downturn than some of its bigger loss-making rivals such as Toyota, Suzuki has been helped by its strong presence in India, one of the world's fastest growing car markets.
"We barely managed to make a profit because small cars at home are doing relatively well and our reliance on North America was relatively small," said Suzuki senior managing director Takao Hirosawa. "Also the Indian market, which is one of our main pillars, is relatively healthy."
But the small car specialist is cautious about the outlook forecasting an 82 percent drop in net profit to five billion yen and an 87 percent decline in operating profit to 10 billion yen. "The environment surrounding the auto industry is very severe," said group president and chief executive Osamu Suzuki. "In the wake of the recession, the way people look at cars has changed. I don't think all the car makers will survive. It's time to question the existence of automakers," he said.
Most other Japanese automakers are in even deeper trouble than Suzuki. Japanese truck maker Isuzu, which is part owned by Toyota, said Monday that it had fallen into the red in the year to March as the global economic downturn sapped demand for its vehicles and the stronger yen eroded export earnings.
Isuzu reported an annual net loss of 26.86 billion yen, against a year-earlier profit of 76.02 billion yen. For the current business year to March it expects a net loss of 20 billion yen. Toyota reported Friday its first ever year in the red and predicted a huge operating loss of 850 billion yen for the current business year to March.