Volkswagen Suzuki rift turns ugly

The German luxury brand, Volkswagen had accused Maruti India of breaching the partnership contract by making use of the Fiat’s diesel engines. The Volkswagen and Suzuki Motors had formed a Joint Venture around 20 months back to mutually benefit from each other’s association.

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Suzuki Motors apparently intends to break the 20 month contract as Volkswagen isn’t unable to develop synergies with Japanese auto major despite the former’s investment of 222.5 billion yen in the project. The JV between the brands was formed with German auto brand holding 19.9 % stakes in Suzuki motor Corp. The partnership between the companies was to enable strengthening of Volkswagen’s presence in India, while Suzuki Motor Corp. intended to gain accessibility to Volkswagen’s hybrid car technology.

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However, Suzuki Motor Corp. continues to argue that they have never breached the agreement by buying the engines from Fiat. Suzuki Motor Corp. had lashed out on Volkswagen for making a defamatory remark against the company. On the other hand, Volkswagen believes that it has made every effort to make the association fruitful. Volkswagen India has plans to introduce new car models in India during next year among which Volkswagen UP! is a small car being tested for Indian market as well.

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