Volkswagen and Suzuki entered a partnership in 2009 with high hopes. They each had something to offer, and everyone was thrilled.
But it failed. Big time.
The saga’s latest couple episodes provide a look inside what went so terribly wrong between the two.
Suzuki CEO Osamu Suzuki called out VW publicly a couple months ago, ripping the Germans apart in a blog post on Nikkei.com.
And now, Suzuki has released a formal complaint against VW, saying that it has breached their deal, escalating the quarrel even more.
So what screwed everything up?
Suzuki rattled off a list of serious gripes in that blog post, but there’s one that stands out (translation via thetruthaboutcars.com):
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.
Whatever VW did, it made the Suzuki execs feel like they were getting stepped on, and hard enough for the CEO to bring the drama out into the public.
On the other side, VW chairman Martin Winterkorn allegedly told German magazine Der Spiegel that “the Japanese still need some training in proper cooperation.”
But here’s the thing: “proper cooperation” means two different things in Japan and Germany. It appears that Suzuki expected total independence, and VW wanted to impose its will because of the $2.5 billion investment it made in the Japanese automaker.
So what’s the next step? They’re likely not beyond making amends quite yet, and that would be the best solution. But after the recent war of words, things are looking pretty dire.
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