Vw might take legal action against Suzuki

Article by Christian Andrei, on October 15, 2011

Legal actions are being considered by Volkswagen over a dispute with Suzuki Motor Corp. related to their partnership. Suzuki asserts that Volkswagen breached their contract and demands that in the next few weeks, the German-based automaker should provide access to its key technologies.

Suzuki said that if VW doesn’t give in to their demands, VW has to sell back Suzuki’s stake and leave the alliance. Suzuki alleges that Volkswagen violated a provision in the partnership pact by withholding hybrid technology it pledged to share.

In a statement, Suzuki's Chairman Osamu Suzuki said that the capital alliance was meant to facilitate Suzuki's access to the core technologies of Volkswagen. In response, Volkswagen said that it has been honoring its agreements with Suzuki.

VW spokesman Michael Brendel said that VW had done everything it could to uphold the partnership.

Suzuki wanted to end the alliance after VW said that it had breached a cooperation agreement by buying engines from Fiat. On Sept. 22, Chairman Suzuki said that VW's accusation had "significantly disparaged Suzuki's honor.”

Suzuki is also demanding that VW make a retraction. In January 2009, VW purchased a 19.9% interest in Suzuki for around 1.7 billion euros. Their partnership suffered problems after VW revealed months ago that it has the power to influence decisions at Suzuki. [source: Autonews]

Topics: vw, suzuki, partnership

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