A verbal battle has broken out between top officials of Suzuki Motor Corp and Volkswagen AG recently, hinting the alliance between the global carmakers is in trouble. An executive at the Japanese automaker reportedly said on Monday the two needed to go back to the drawing board on their multi-billion-dollar partnership.
“It was made very clear when we tied up with Volkswagen that we did not want to become consolidated, and that we would remain independent,” said Executive Vice President Yasuhito Harayama, who is in charge of Suzuki’s relations with Volkswagen.
European giant VW’s purchase of a near-20 percent stake in Suzuki for $2.5 billion in December 2009 was welcomed by investors who expected Volkswagen to gain an inside track into Suzuki’s leading small-car technology, while Suzuki would have access to Volkswagen’s hybrid and other advanced technologies that it would not be able to afford on its own.
In any case, technology sharing between the two hasn’t happened 18 months since the alliance was announced. Fractures surfaced when the German carmaker accused its Japanese partner of non-cooperation in an interview with a German magazine.
Harayama added that there were other automakers who were willing to work with Suzuki on an equal footing, and that Suzuki would continue to pursue operational tie-ups with a broad range of companies while holding back on any projects with Volkswagen until the two can reaffirm their initial understanding.
“Right now, there is no specific joint development project going on with Volkswagen,” Harayama told reporters in a group interview with Suzuki’s four new executive vice presidents.
Harayama’s comments indicate a major step back for the Volkswagen-Suzuki partnership, which had been cheered by financial markets when it was formed in December 2009.
