Friday May 25, 2012

JAPAN NEWS AND DISCUSSION

Suzuki ends Volkswagen partnership

Business Sep. 13, 2011 - 06:48AM JST ( 13 )

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13 Comments

1

JeffLeeSep. 13, 2011 - 08:33AM JST

Recalcitrant Japanese versus overbearing Germans. It seems VW had grand amibtions to create a global automaker, while Suzuki really only wanted better access to German technology.
1

The Munya TimesSep. 13, 2011 - 10:03AM JST

Yearn for power drove Suzuki mad.

Suzuki's decision came a day after Volkswagen served notice of an alleged infringement relating to the supply of diesel engines to Suzuki from Italian carmaker Fiat.

Maruti in India has lost its productivity, their other bigger factory in Hungary unable to roll products on their own technology and uses Fiat engines and technology. VW is clearly fed up with Suzuki's greed and power game. Suzuki needs huge manufacturing capacity that it lost completely. The hardheaded samurai dictating Japanese business style leadership losing its grip on the world. VW is obviously not Suzuki's dependent subordinate.

Suzuki slowly begins to learn to taste their own cooking. Very tasty, yummy yummy.
2

electric2004Sep. 13, 2011 - 12:39PM JST

Knowing Volkswagen, there is quite some possibility that they tried to take over Suzuki in the long run. And also it seems that Suzuki noticed that early enough.

On the other hand, Suzuki ordering Diesel engines from Fiat instead from Volkswagen, seems to be quite an insult considering the high quality level and low fuel consumption of the Volkswagen/Audi TDI Diesel engine lineup.

Maybe Fiat and Suzuki are on a more equal footing - but probably this will give Suzuki neither any new Technology and might not help to improve quality. Suzuki will learn this the hard way after the field recalls of these engines due to trouble will start.

I wonder why Suzuki does not simply made a deal with Isuzu, who was actually making small Diesel engines for Opel in the past?
0

some14someSep. 13, 2011 - 01:13PM JST

“Rather than trying to find faults in each other, it’s better to smile at each other and say we were not destined (to get married).”

Wish Mr. suzuki had used same philosophy and stopped struggling in India in late 90's
0

NetNinjaSep. 13, 2011 - 01:51PM JST

I think we covered this ground a bit in another article about cars. Fiats are the worse.

The best way to get spare parts for your Fiat is to follow another one. With that said it doesn't surprise me that Suzuki wants to end the relationship with Volkswagon.

"You're not putting those busted Autobot Transformer engines in our cars" - Subaru CEO

To it's credit, Subaru makes a cool little ride with it Swift Sport version.

On the other hand, Aunty Entity say: "Bust a deal, face the wheel" Thunderdome is definitely where these two companies are headed. It'll be a legal trainwreck. This is a bad habit of Japanese companies, making their contracts appear almost worthless.

If the headhonchos at Suzuki really think of this as a divorce then It's better to pay to make them go away in Japanese culture. Suzuki better be ready to practice what they believe in to ditch Volkswagon.
-1

viking68Sep. 13, 2011 - 02:50PM JST

Actually, under an agreement, Suzuki was supposed to supply VW with diesel engines and instead outsourced them from Fiat. Suzuki was profiting from the deal and having to produce the engines themselves, as VW thought they should under their contract, would have left them with less profits (increased costs).

VW could have asked Fiat to supply the engines themselves and saved the mark-up (profit) charged by Suzuki.

VW bought 19% of Suzuki's stock, and Suzuki only bought 1.9% of VW's (not sure of the total value of those %).

Unless something else comes to light, VW sounds to be in the right, and Suzuki tried to pull a fast one and got caught.

Nice way to treat a "partner" there Suzuki.
0

presto345Sep. 13, 2011 - 02:58PM JST

To it's credit, Subaru makes a cool little ride with it Swift Sport version.

I thought Suzuki produced the Swift?
0

presto345Sep. 13, 2011 - 02:58PM JST

VW is obviously not Suzuki's dependent subordinate

Nor is it the other way round.
0

Ted BarreraSep. 13, 2011 - 03:28PM JST

I thought VW was actually starting to do really well here in Japan. Seeing a few more Golfs and Tiguans around. I see this as a loss for Suzuki.
1

Johannes WeberSep. 13, 2011 - 03:56PM JST

This fits very well with another article:http://search.japantimes.co.jp/cgi-bin/nn20110913a2.html. Japan's companies fade away from the league of global players. It seems that international cooperation is obviously key to be important. And that some Japanese CEOs still believe that these rules are not valid for them. Volkswagen tried to expand into the Japanese market via Suzuki. They underestimated the Japanese aversion towards foreign influence.

VW is obviously not Suzuki's dependent subordinate.

I can't help being confused about this. How can one of the biggest three (automakers) of the world be subordinate to anyone? The last company that tried to dictate their course to Volkswagen was Porsche. They ended up as part of the Volkswagen family. Don't mess with the big ones. You will always regret it. Cheating business partners of that size may leave Suzuki's national business unharmed, but it will have a harmful impact on its international plans.
-1

viking68Sep. 13, 2011 - 04:00PM JST

Upon further reading of new articles, VW thought Suzuki should buy diesel engines from them. I believe I heard the resourcing argument (VW buys engines from Suzuki and Suzuki subcontracted to Fiat) on a PBS Newshour podcast. I could be mistaken.

All news reports appear to say that VW thought Suzuki should buy diesel engines from them. I wonder if there was an actual agreement to that effect or whether Suzuki doesn't like the deal now that it is all looking bad for them.

We'll likely get to see this play out and find out what is what. Divorces are messy.
1

The Munya TimesSep. 13, 2011 - 06:16PM JST

I can't help being confused about this. How can one of the biggest three (automakers) of the world be subordinate to anyone?

Of course not. I should have elaborate it instead of being biting toward them. Their long years of cruel, Machiavellian, scrounging, unfair business manner toward their employees and subcontractors made me. They grew ignorant , started thinking too much about themselves, flying too high and tried the same trick on VW, who proved to be a snack too big for them to swallow and got stuck in their throat.

It was not long ago I wrote in my previous post on Suzuki failure in India that Suzuki is only interested in gaining power and acquiring superb technology. I never thought the divorce would come so soon and their issue of , power and technology, would be revealed.
0

The Munya TimesSep. 13, 2011 - 06:18PM JST

"Of course not. I should have elaborate it instead of being biting toward them" I mean toward Suzuki.