Volkswagen-Suzuki partnership not over yet

09/08/2011 - 09:22 | ,  ,  ,  ,   | Kaustubh Shinde

Since the VW- Suzuki partnership has been on the rocks for quite sometime, there were rumors about the possible break up between VW and Suzuki. However Reuters has confirmed that the partnership is still going strong and there are no plans of parting ways.

Volkswagen Bulli Concept

The two car companies joined hands together in 2009 when VW bought 19.9% stake in Suzuki. There many talks about how the Japanese counterpart can help VW establish a strong presence in the small car market. The partnership was especially beneficial for India because Maruti Suzuki knows the market dynamics like the back of their hand. VW, a relatively new entrant, would have benefited immensely with that knowledge.

However, since the last 3-4 months, there has been a media war between the two companies. VW went on wires to confirm that they were not getting enough co-operation from the Japanese counterpart. In return, Suzuki’s head honcho made a blogpost that VW was not giving due respect to Suzuki and the two groups needed to go back to the drawing board on their partnership. Suzuki did not want to be viewed as a group company of Volkswagen and reports of a rejig in the stake-holding pattern also came to the surface.

So far no progress has been made by the partnership. Both the companies are operating independently and there is little or no knowledge sharing. The partnership promises to be huge if they could sort their differences out.

Can Volkswagen and Suzuki settle their differences or will the two companies find it hard working together?

[Source - MotorTrend.com via Reuters.com]

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