Volkswagen has been known for buying stakes in companies and later on gobbling them, making them a part of their automobile empire. But this is not going to happen with Suzuki as Mr. Osamu Suzuki has made it very clear through his blog. Ferdinand Piech (the person at the helm of things at VW) was unsatisfied with the way things were going but Mr. Suzuki was kind enough to clarify that they will work as an independent car maker. The German giant put in $2.5 billion on the table to acquire 19.9% stake in the Japanese automaker.
Some of the key points made by Mr. Suzuki are extremely valid. Firstly Suzuki is not at all impressed with the wrong impression carried by VW. The Japanese automaker feels that Volkswagen is mistaken that Suzuki falls under their umbrella and their technologies are not really interesting enough for them to adapt. If need be, Suzuki always has the option to exchange technology with other companies, including Fiat, which is a big partner for the company. Read the complete piece by the man in-charge at Suzuki below.
“Blog by Osamu Suzuki
Present and future of cooperation between Suzuki and Volkswagen
It has been one and a half years since Suzuki signed a partnership with Volkswagen in December 2009. Many people criticized us for being unable to announce any specific fruit of the cooperation. Let me summarize what I have in my mind.
Lately, people of Volkswagen are telling their shareholders that Volkswagen can largely influence the corporate policy of Suzuki. I feel somewhat uncomfortable with the statement because the two companies agreed to remain independent partners on an equal footing when we signed the partnership in the first place. Since the companies differ in size, people of Volkswagen may develop a mistaken impression that Suzuki is placed under their umbrella. However, Suzuki signed the agreement under the condition of being an equal partner. Thus we cannot simply accept this notion. The two companies have been having a lot of exchanges. We learnt more about Volkswagen. I assume that Volkswagen gradually developed understanding about Suzuki. As a result, the initial basic agreement seems to falter.
Does Suzuki face an immediate difficulty? The answer is “Not at all.” We learnt about Volkswagen’s technologies, but we did not find any one of them interesting enough to adopt immediately. Suzuki is working on its own green technologies. Our engineers are gaining more capabilities than I expected, and are developing surprisingly good technologies. For example, our new minicar engine that was developed for the first time after 16 years enjoys class-leading fuel efficiency in Japan. We are producing more than 200,000 units of our diesel engine, which is attracting a lot of attention, in India. Thus for the time being, particularly in critical markets like the minicar market and India, we are not in a hurry to collaborate with Volkswagen. Suzuki is also working on eco-friendly cars. One example is our original EV equipped with a standby generator, which is under development for commercialization.
If we are short of any technology, we have an option to ask other companies with which we benefit from technological exchanges. Supply of diesel engine from Fiat that was announced the other day is one example. Technology race intensifies in the auto industry. The scheme of capital participation to take control of another carmaker will no longer work. We need to remain independent to be perceived as an attractive partner by other automakers around the world. According to a recent report by a major German business magazine, Volkswagen seems to gain visibility of developing low-priced cars for emerging markets such as South America and India. I am relieved.
I assume that many of you are interested in what would happen to Suzuki’s relationship with Volkswagen. We intend to continue having dialogues in all sincerity with our partner in order to build a relationship of equality. After all, this has been the purpose of joining hands with Volkswagen. I will do my utmost to develop Suzuki into an independent and distinctive company, and measure up to our shareholders’ and users’ expectations.
I am increasingly excited in face of many challenges. Recovery from the earthquake is urgent. We have to do it NOW. I am certainly older, but I am ready to continue working hard with the employees of Suzuki.”
Source – The Truth About Cars