Volkswagen, Suzuki Tie-Up Unravels

Colum Wood
by Colum Wood
volkswagen suzuki tie up unravels

Young love can turn into a bitter divorce faster than you can say “ Rocktan.” That at least appears to be the case with the relatively recent partnership between Germany’s world-domination seeking Volkswagen and the minicar experts from Japan, Suzuki.

Like many a relationship gone sour, the problem appears to be communication.

“Volkswagen is not talking to us,” said chairman Osamu Suzuki. “”We have no plans to talk to them.”

Suzuki also accuses VW of speaking directly to the media, rather than with executives at the Japanese automaker. The divide between the two reportedly began when Volkswagen announced it could, “significantly influence financial and operating policy decisions” at the Japanese automaker.

Suzuki’s response has been swift, announcing that, in retrospect, it’s not interested in any of VW’s technologies, following through on that statement by opting to purchase diesel engines from rival Fiat.

The tie-up was first announced in 2009, with VW spending $2.9 billion for a 20 percent stake in Suzuki. The plan was cooperate on electric and hybrid technology while VW hoped to tap into Suzuki’s success in emerging markets like India, where last year the Japanese automaker sold 1.13 million vehicles compared to VW’s 53,000.

Officially the two automakers are continuing to live in the same house, but somebody’s sleeping on the couch. And as they’re certainly not sticking together for the kids (in two year’s not a single joint project has been developed), look for someone to file divorce papers soon.

[Source: Bloomberg]

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