General Motors has reached an agreement with Suzuki Motor to buy the latter’s 50% stake in the Canadian joint venture (JV), CAMI Automotive, at an undisclosed price. With this, GM has severed its ties with its second Japanese partner after Toyota Motor (TM).
Based in Ingersoll, Ontario, CAMI Automotive was established in 1986 to help GM produce fuel-efficient cars. It also provided Suzuki access to the North American market. The JV launched production three years later and has produced more than 2.3 million vehicles so far, including the Chevy Metro, Suzuki Swift and Pontiac Firefly.
The deal was a logical step forward for Suzuki as the Ingersoll plant no longer produces any of its vehicles. The plant stopped manufacturing Suzuki-brand vehicles after halting the XL7 in June due to slack demand. The Japanese automaker now exports vehicles from Japan for sale in North America. With the new agreement, GM will gain full control of the manufacturing operations.
In 2006, GM sold a 17.4% stake in Suzuki for $2 billion in an effort to gain much-needed cash. Last year, the cash-strapped company sold its remaining 3% stake in the Japanese company in the wake of the global financial crisis.
GM pulled out of New United Motor Manufacturing, Inc. (NUMMI) joint venture with Toyota after completing its bankruptcy filing in June, as part of its plan to discontinue the Pontiac brand. The NUMMI produced Corolla and Tacoma for Toyota and Pontiac Vibe (Toyota’s version of the Vibe) for GM.
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