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Volkswagen and Suzuki’s recent engagement has hit its first rock. The two companies went into partnership in 2009 when VW took a 20% stake in Suzuki Auto, along with an announcement the two would cooperate in several areas, including engines. But now one of them says the other has reneged on the agreement by sleeping with a third party.
In June 2011 Suzuki decided to order diesel engines from VW’s Italian rival Fiat, despite said agreement with VW to share such equipment where possible.
VW has now issued a statement which in part, reads: “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.”
Discussions could prove impossible at this stage since it appears the two don’t even talk anymore. Osamu Suzuki, the Japanese partner’s chairman told Bloomberg last week that the companies are barely on speaking terms.
Suzuki, a major player in Asia’s second-fasted growing economy, India, is important to VW as it seeks to become the world’s biggest automaker within the next 7 years. Last year it delivered 2.64 million cars globally, 1.13 million of them in India. VW on the other hand, only sold 53 300 cars within the Indian borders.
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