Following recent reports of a growing rift between the two, Volkswagen has now said – officially – that it is serving an infringement notice on Suzuki and reviewing its partnership with the Japanese automaker.
Volkswagen said the notice concerning the infringement relates to the supply of diesel engines produced by another manufacturer to Suzuki.
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Though the automaker did not name the other manufacturer, this is understood to be Fiat. In June 2011, Suzuki announced it would buy Fiat diesel engines for a future new model. This made sense as Fiat was already supplying diesels to Suzuki and the pair have an alliance on at least one vehicle line.
But “Volkswagen takes the view that this contradicts the terms of the cooperation agreement. Suzuki has now been given a period of several weeks to remedy the infringement. Volkswagen considers this step regrettable, but necessary, and has offered to discuss the matter with Suzuki. At the same time, the company stresses it still regards Suzuki as an attractive investment,” a VW statement said.
Volkswagen acquired 19.9% of the shares in Suzuki in December 2009 under a strategic cooperation. In its half-yearly financial report published in July 2011, Volkswagen noted that the partnership was developing more slowly than expected and announced a review. This review has not yet been finalised, the automaker said.
“Volkswagen is not talking to us,” Osamu Suzuki, the Japanese automaker’s chairman, said in a recent interview with Bloomberg News. “We have no plans to talk to them.”
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By GlobalDataVW had apparently upset Suzuki by saying it its March 2011 annual report that it could “significantly influence financial and operating policy decisions” at Suzuki, describing the Japanese company as an “associate.” That didn’t sit well with Suzuki, according to Bloomberg.
The partnership was meant to combine Suzuki’s leading position in India, Asia’s second-fastest growing major economy, with Volkswagen’s global reach as the world’s third biggest carmaker.
