Suzuki lashes out at Volkswagen

A top executive of Suzuki Motor Corp, the fourth biggest auto makers in Japan has revealed on Monday that the things between Suzuki Motor Corp and Volkswagen are not going well at the moment, speaking of the alliance formed between them in December 2009. The venture was formed with Volkswagen buying 20% of Suzuki’s stakes at $3.5 billion. This is most cheered partnership formed then, hoping that Volkswagen will gain insight into Suzuki’s small car production technology, while Suzuki will be able get hold of the hybrid and other advanced technologies that Suzuki might not be capable to afford otherwise.

With more than 18 months  Suzuki Volkswagen partnership, there has been no progress made so far and the Executive Vice President of Suzuki Motor Corp., Mr Yasuhito Harayama has exposed to the media on Monday that there is no specific joint project going on for both the auto giants and also mentioned that it had been made very clear from the start that the Suzuki Motor Corp. intends to work independently despite the joint venture formed. It was also told during an interview with Suzuki’s four new Vice presidents that they seem to go back to the same point where they had begun including over the ownership ratio. He also expressed that the understanding that both are independent companies and are equal partners to pursue any specific cooperation is imperative. Harayama has also intimated that Volkswagen had categorized Suzuki as a company, consolidated under the equity-accounted method over which they have ‘great control’ in their annual report, which is untrue as per their understanding.

Osamu Suzuki, a chief executive at Suzuki Motor Corp. has informed that Suzuki had limited the German automakers, Volkswagen’s stake to 19.9% at the beginning of the subsequent equal partnership deal one and a half years back. As a cross-share holding agreement, Suzuki motor Corp. has also been gradually acquiring Volkswagen’s shares.

Last month, it was announced that Suzuki Motor Corp. intends to buy 1.6 liter diesel engines from Fiat, for a car to be manufactured in Hungary.  This is a deal which could prove that Suzuki Motors can do well without Volkswagen in its wake.