Suzuki Says Sayonara to Volkswagen

11/21/2011 @ 3:13 pm, by Jensen Beeler26 COMMENTS

Suzuki Says Sayonara to Volkswagen volkswagen motor 635x476

Back in 2009 Suzuki and Volkswagen made some headlines, as the German automaker took a 19.9% stake in the Japanese manufacturer. The basic points of the agreement were that Volkswagen would get access to Suzuki’s small-displacement motors and Indian presence, while the latter would benefit from Volkswagen’s larger-vehicle technologies, etc.

Seemingly however doomed from the start, the partnership in motorcycle circles erroneously spurred some interesting thoughts of a Volkswagen motorcycle coming to fruition. While industry journalists spun gold out of hay, the two behemoth manufacturers failed to come to terms on any of their proposed partnership goals, leaving both parties to wonder why they were interested in each other, let alone financially intwined.

With that strife coming to a head the past few months, it comes with little surprise then that Suzuki has issued a statement saying that it was terminating its partnership with Volkswagen. As much of a lesson in cultural differences as it is one on business positioning, the news certainly doesn’t come as a shock to industry insiders, though it does shed some light on Suzuki’s recent withdrawal from motorcycle racing.

Looking to raise cash to purchase back the 19.9% equity stake Volkswagen holds in Suzuki, the Japanese manufacturer has reportedly been pinching every penny to once again become a sovereign company. The result could very well account for Suzuki’s withdrawal from World Superbike, and it more recent departure from MotoGP. Reading Suzuki CEO Osamu Suzuki’s statement regarding Volkswagen, some would consider Volkswagen’s position as a hostile one.

“Today Suzuki terminated the partnership with VW. Suzuki will be seeking the return of its shares from VW in arbitration,” said Suzuki. “I am disappointed that we have to take this action but VW’s actions have left us no choice. They have continued to refuse our attempts on numerous occasions to resolve these issues through negotiation. I am more disappointed that having shaken the hand of Dr. Winterkorn in agreeing to this partnership, he has not honoured his commitment to grant Suzuki access to what was originally agreed.”

“In the absence of VW’s cooperation and given its failure to do what was agreed, there is no basis for the partnership to continue. With the cessation of the partnership there is also no basis for VW to hold on to Suzuki’s shares. We will now work to restore the relationship between Suzuki and VW to its original state as independent parties who do not restrict each other’s business. I call on Dr. Winterkorn to honour this.”

Source: Suzuki & WSJ

Comment:

  1. fazer6 says:

    It never made sense anyway–Even if Suzuki might be on the bottom rung of Japanese auto builders, VW is at the bottom of the world’s auto builders, who would want to share technology with the company who makes the worst cars in the world?

  2. Volkswagen is the third largest producer of automobiles in the world. Not too bottom-rung in my book.

  3. fazer6 says:

    Largest yes–In the same way that Wal-Mart is a behemoth retailer/distributor.
    But VW consistently ranks at or near the bottom in quality, reliability and customer satisfaction.

    I’m sure Suzuki would love to see even half the volume of VW, but to do it through ‘technology sharing’ didn’t make any sense.

  4. Abazabazm says:

    “VW consistently ranks at or near the bottom in quality”

    lol

    don’t tell that to the guy in the Bugatti Veyron, or the Audi R8, or the Lambo Gallardo or the Bentley or the….

  5. fazer6 says:

    They’ve got enough money not to care.

  6. fazer6 says:

    BTW Jensen, no fair editing your posts if we can’t.

  7. MikeD says:

    the two behemoth manufacturers failed to come to terms on any of their proposed partnership goals, leaving both parties to wonder why they were interested in each other, let alone financially intwined.
    ~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~

    OH YEAH, i can totally relate to that…ROTFL…one of those “relationships”….Ahhh? LMFAO.

    Oh well, now they should know a bit better.

  8. 76 says:

    Fazer6
    You should also let the people know who bought those horrible cars like
    Audi TT
    A4 / A6
    Rs8
    VW bug
    Bentley Continental GT
    Lamborghini Murcielago

    Oh I mean the cars that changed the face of car design, and design in general, in lets see maybe alittle more than the last decade. Also better tell every other manufac. to stop copying them, they might end up in the bottom rung?

  9. fazer6 says:

    Most of them already know it, that’s why they report low scores to JD Power and Consumer Reports, and almost never buy another VW product.

  10. fazer6 says:

    Besides, if they just wanted to copy the exterior design of VW and Audi, they should have just hired away their designer … oh wait, Kia already did that.

  11. Halfie 30 says:

    I work on cars all day. Anything with a VW engine is crap. I won’t even go into how many warranties and unhappy VW customers I’ve had the pleasure of speaking with.

  12. @fazer6: Ummm….what did I supposedly edit?

  13. 76 says:

    A VW/Audi 2.7T & 4.2 V8 is far from crap, and the downtuned V10 is just awesome. I really dont like getting chatty about cars to begin with but I really cant agree with this idea they make nothing but junk, to me they are some of the few cars that get it, this also comes experience with each and about 200k miles between them all with few problems to remember, I just must have been lucky?

  14. buellracerx says:

    being a VW owner and original skeptic, I can honestly say build quality, value, and overall robustness in engineering design impressed me to the point where I will be buying another soon.

    too bad about this relationship, sucks when it has to come to “it’s not you, its….oh wait, no it’s totally all you…”

  15. Abazabazm says:

    Fazer
    can we agree that Vw is building better cars than Zusuki….?

  16. Damo says:

    @everyone

    http://businesscenter.jdpower.com/JDPAContent/CorpComm/News/content/Releases/charts/2011029-1.jpg

    fazer6 (like me) is talking EXCLUSIVELY in terms of product quality. No one is doubting that VW has a good design team per se, we are just starting that they make unreliable cars as a whole. Which is true. Hell the Audi A6 was the least reliable platform in 2010.

  17. Damo says:

    @Abazabazm

    “don’t tell that to the guy in the Bugatti Veyron, or the Audi R8, or the Lambo Gallardo or the Bentley or the….”

    All cars that will NEVER see north of 50,ooo miles. Also anyone who buys those cars, obviously doesn’t care about money.

    I am biased though, as a car is something I drive in between bike rides. It is exists solely for convenience and shelter from the New England Death Winter.

  18. Kevin says:

    I was waiting for someone to quote JD Power and Consumer Reports. Don’t you guys know that they speak the gospel? Ugg..

    I’ve never owned a VW or Audi, but have several friends who have owned several over the past 10 years….and they continue to love them. *Shrug*

  19. Damo says:

    @Kevin

    I love old Jaguars more than ice cream and puppies, but it doesn’t make them anymore reliable. The fact stands most “cheap” American and Japanese cars are more reliable. Which is all fazer and I said.

    These charts also don’t take into account the cost of repairs which is substantially higher amongst European boutique brands.

    Then again if all anyone wanted was reliability, we would all drive a 1980 Volvo 240 Diesel or a mid 1980′s Caprice Classic.

  20. mxs says:

    A lot of clueless, but surely opinionated people here … LOL

    I’d rather take less reliable VW over very reliable Toyota (no pun intended, you can replace that with anything you want) any day. There are other things like steering feedback, handling and quality of ride … besides reliability.

    It’s just a matter of preference.

  21. Halfie 30 says:

    Has anyone here who is backing VW ever had to do and serious mechanical work on one? Of course not! Because if you had you wouldn’t own one…

  22. Shawn says:

    That’s the exact FSI engine I am driving now. It’s approaching 100K miles and no major issues for me. Plus it beats up on compact Japanese cars with coffee cans, so that’s always nice. No major mechanical work myself, I leave that up to the experts, but oil change every 10K miles is also convenient. To each their own, there are lovers and haters for every brand.

  23. Damo says:

    Personally, my main requires for a car are as follows:

    -Reliability
    -All Wheel drive
    -Good Gas Mileage

    Things I can’t really get out of Germany.

    Like I said, a car to me is what I used when it is snowing out I need to carry something I can’t fit on the bike.

    I get all my sporting done on two wheels, because I would have to drop over $100k to get a car that could match the performance of a $5,000 bike.

    If I was a car guy I would be over on jalopnik, not talking to you hooligans ;)

  24. BikePilot says:

    Who cares which is best, they are just cages and neither mfg makes anything that’s much good at hauling racebikes (the only point in having a cage, obvi ). The usefulness of this article is to put to bed the stories about VW-Suzuki motorcycles.

  25. Simone says:

    BTW,

    - VW is a NAZI car after all.

    Founded by Nazis.

    Hitler`s favourite car.

    - Suzuki rep. says above

    They have continued to refuse our attempts on numerous occasions to resolve these issues through negotiation. I am more disappointed that having shaken the hand of Dr. Winterkorn in agreeing to this partnership, he has not honoured his commitment to grant Suzuki access to what was originally agreed.”

    this shows how much vw cares about ethic values or has honor.

  26. Ryan says:

    I work on Porsches for a living and I’ll tell you flat out. all we do all day long is regular maintenence. THEY DONT BREAK. (aside from early boxsters.. and v6 cayennes… but everyone knows those are terrible) Ive worked on Audis and VWs before and ok maybe I wanted to shoot myself in the face a couple of times but for the most part they arent that bad. the motors are stone cold reliable.. so yes if your seats stop working and the rubber coating rubs off in your interior, Itll still get you to work in the morning [NEWS FLASH: everyone go buy an 88 toyota pickup and never worry about car trouble again]