AP NEWS
Related topics

Incentives Help Samurai Sales To Set Record

September 7, 1988

NEW YORK (AP) _ Sales of the Suzuki Samurai broke a monthly sales record by 45.9 percent in August as sharp price cuts helped it stage a comeback from the damage done by allegations that it was an unsafe vehicle.

Samurai sales plunged by 70.6 percent in June after Consumers Union charged that the small, boxy, four-wheel-drive vehicle was dangerously top-heavy and prone to rolling over.

August sales totaled 12,208, up from the 2,199 sold in June and the 6,327 sold in July. The sales were 54.4 percent ahead of the 7,905 sold in August 1987 and 45.9 percent ahead of the previous-record 8,365 sold in July 1987.

″Certainly consumer confidence is back in the Samurai,″ said Douglas Mazza, general manager of the automotive division of American Suzuki Motor Corp.

Consumers Union, publisher of Consumer Reports, stood by its criticism of the Samurai, which it has rated ‘not acceptable.’

″In essence, deep discounts and advertisements for fun and excitement do not make this a safe car,″ Marnie Goodman, a spokeswoman, said Tuesday.

The swift turnaround restored Suzuki’s winning image just in time for the fall introduction of two new vehicles, a bigger four-wheel-drive vehicle named the Sidekick and a small hatchback named the Swift.

Suzuki is predicting Samurai sales will drop off now that the dealer incentives have ended, but it is counting on the Sidekick and Swift to more than pick up the slack.

Analysts said American Suzuki - the U.S. arm of Japan’s Suzuki Motor Co. - is in a much better position than it was three months ago.

″Momentum tends to feed on itself,″ said Scott Merlis, an analyst for Morgan, Stanley & Co.

Merlis said he could not comment on the Samurai’s safety, but said it was obvious that customers were willing to shed any lingering doubts raised by television news clips of the Samurai tipping over while zigzagging on a Consumers Union test course.

″It’s sometimes quite ironic how cash rebates can be the antidote to safety concerns,″ Merlis said. ″Occasionally you see sales incentives work like magic.″

On July 13, Suzuki announced $2,000 incentives to dealers that made it possible for them to slash 25 percent from the Samurai’s $7,995 base price.

Suzuki steadfastly has defended the Samurai’s safety, and its contentions were supported Thursday when the National Highway Traffic Safety Administration rejected petitions to investigate and recall the vehicle. The agency said the Samurai was no more dangerous than similar vehicles made by other companies.

AP RADIO
Update hourly