[oxyzen]

There is always a give and take scenario.

I think suzuki wants to Deny VW, the K-series technology. The O-Suzuki speech was a cover up.

[vigneshnr]

At first, I'm surprised that Osamo san didn't find VW's technologies interesting. May be the DSGs & Turbos do not fit their traditional school Mantra - "Small" - "Low Maintenance" - "Efficient" etc.
In VW's mission of becoming world no.1, suzuki is a complementing portfolio as Suzuki has its own strong presence in asian markets esp the high growth Indian sub continent. Reliabilty of Suzuki has been built over decades & consumers from developing nations inherently seek the same.

And from this statement it seems Suzuki's aspirations are limited and unwilling to explore beyond what they have got. For a small player like suzuki who is volume hungry it matters to be amidst the masses - so they may fear experimenting around.

Finally, it is VW who bought Suzuki not the other way around . So VW's POV of Suzuki's technologies / portfolio is important.

Here is the statement from VW Chief - Martin Winterkorn about the "Differences" which may reflect VW & Suzuki's way of working

Volkswagen CEO admits to differences with Suzuki on JV - Times Of India

[rajess_in]

Originally Posted by aaggoswami

If I am not wrong, Suzuki is 9th largest car maker in the world by volumes. We just cant call is that small.

True, but their portfolio is limited as far as I see it. If volumes matter, then brands like LR, Volvo, etc. can never be regarded big.

The point is, there are always learnings in all level and in all area (not just engineering). Being an mature industry, Suzuki should have taken leverage from the venture.

If VWs' technology is not interesting / do not suit them, then I would say, they have very limited vision as far as their future vehicles are concerned and they are really content with their current market share.

But looking on the fact that they are struggling in other markets apart from small cars, they should have definitely used the oppurtunity to learn more about bigger cars and future technologies.

All technologies introduced in vehicles now, had been initiated a decade or so before. So if Suzuki wants to be a bigger player in 2020, they should start their work right now.

[mallumowgli]

If Suzuki is not finding anything interesting in the alliance, then why the marriage? I dont think the management would have thought, "lets first get the alliance in place, then talk about benefits"

Suzuki in no way can be considered a big manufacturer, even by volumes - their biggest market by volumes is India, where most numbers comes from Alto. Compared to VW, which is a giant by any standards, Suzukis are minnows - but they have good petrol engine technologies and, more importantly, better understanding of the small car market. Looking at a business perspective, both can gain a lot from each other - both in terms of technology and market reach.

There must be some other real motive for Suzuki's comment - something going on behind the scenes, perhaps

[vina]

Originally Posted by mallumowgli

If Suzuki is not finding anything interesting in the alliance, then why the marriage? I dont think the management would have thought, "lets first get the alliance in place, then talk about benefits"

Suzuki in no way can be considered a big manufacturer, even by volumes - their biggest market by volumes is India, where most numbers comes from Alto. Compared to VW, which is a giant by any standards, Suzukis are minnows - but they have good petrol engine technologies and, more importantly, better understanding of the small car market. Looking at a business perspective, both can gain a lot from each other - both in terms of technology and market reach.

There must be some other real motive for Suzuki's comment - something going on behind the scenes, perhaps

What marriage? VW wanted to give them $1Billion, so they took it. Why would they say no, who indeed would say no?

[DicKy]

Originally Posted by vina

What marriage? VW wanted to give them $1Billion, so they took it. Why would they say no, who indeed would say no?

That was a good one,
But can't understand what Maruti would benefit from? Other than diesel engines perhaps.
I's VW who have to gain from. Their cost structure is too much for the mass markets price sensitivity, also a rebadged VW would do wonders for them.
VW badge with Japanese reliability and low spare parts cost. Anyone???

[Nicky]

@ Dicky,
I am surely VW is planning for something BIG with 20% initial breach. I hope we know what they did with porsche and how!!!
Never know where these VW guys are playing their cards.

[vina]

Originally Posted by Nicky

@ Dicky,
I am surely VW is planning for something BIG with 20% initial breach. I hope we know what they did with porsche and how!!!
Never know where these VW guys are playing their cards.

you are forgetting that in the same deal Suzuki also picked up a double digit stake in VW - usually a protection against the kind of "something BIG" that you are insinuating.

[DicKy]

Originally Posted by Nicky

@ Dicky,
I am surely VW is planning for something BIG with 20% initial breach. I hope we know what they did with porsche and how!!!
Never know where these VW guys are playing their cards.

Originally Posted by vina

you are forgetting that in the same deal Suzuki also picked up a double digit stake in VW - usually a protection against the kind of "something BIG" that you are insinuating.

Same reason why i dislike VW group as a whole,they have turned companies like Lambo,Bentley fortunes overnight but still you can't disagree with the fact that they are corporate hunters, just hope that Suzuki doesn't fall for it.
Anyone saying that VE model is how business is done should look at Toyota. Bought only Dahiatsu and shares of Subaru, but that's after becoming numero uno. Even without Subaru and Daihatsu,Toyota will be the same.Same thing you can't say about VW.

[nipunkul]

Porsche look a large stake in VW, before the rising share price threatened their debt burden, and VW then acquired them whole-sole. So O doesnt realize that he cannot stop VW when they set themselves to the acquisition.

Currently IMHO, suzuki faces a big dilemma since they have massive volumes in India on the promise of Value, meaning inexpensive but reliable cars which you need to service every 2-3 months, which is where Suzuki makes the bottomline swell. If they choose to adopt VW tech, like their TDI's TSI's and DSG's, they run a dual risk:

1. The enthusiast community which hails the Multijet and upcoming MultiAir, will not be as impressed with less refined TDI's and sales could fall due to lower efficiency.

2. With TDI, TSI and DSG, these are expensive, so the Value proposition is threatened, but more importantly, these need service once in a year, and MSIL cant hope to increase service costs 4-5 folds and have the same loyal value loving clients, which means the bottomline will be hit at least during the transition of customer segment.

Now VW will gain advertising that their tech runs India and all that, but Suzuki's market positioning will be destabilized in the ABC segments . Suzuki has never been able to sell an expensive car in India, and even with VW tech, their badge will never stand the heat in C+, D, D+ segments.

[girishglg]

There must be a game plan under MS belt not to work with VW. It may be just current market forces which may determine this decision. Given that MS plants the National Diesel heart (read 1.3) in all its capable buggies, the recent news that Fiat has excess capacity to churn out more of these in their MH plant. It may be pure economics to stick with that for the time being.

If and when VW plans to bring a more capable motor into our land, and produce it over here itself then MS may shift their loyalties. Till then its 1.3 siblings all the way. Interesting time ahead.

[askicode]

Just came across this recent news
http://economictimes.indiatimes.com/news/news-by-industry/auto/automobiles/suzuki-signals-rift-with-volkswagen-over-multi-billion-dollar-partnership/articleshow/9268931.cms?curpg=1

Looks like all is not well with Suzuki & Volkswagen. I was very surprised at first after reading it and then as I pondered I did realise there were always visible signs. Its actually quite surprising that after more than 1.5 years there seems to be no synergies at all between the two. If you look at the SX4 diesel, it was launched with 1.3 Fiat Diesel engine when actually it could have been quite easy to source the same from VW.

Last month, Suzuki announced a deal to buy 1.6-litre diesel engines from Italy's Fiat for a car to be built in Hungary, a deal that both Suzuki and Harayama said proved the automaker could do without Volkswagen.

I remember we had earlier threads on this wherein we were wondering how Suzuki models would be positioned with VW lineup http://www.team-bhp.com/forum/indian...randed-vw.html

Looks like a courtship gone sour. Not too sure whether either group benefited at all with this JV.

[RemingtonSteele]

Suzuki signals rift with Volkswagen over partnership
11:09am IST 18thJuly

HAMAMATSU, Japan (Reuters) - Relations between Suzuki Motor Corp and Volkswagen AG's have soured, with an executive at the Japanese automaker saying on Monday the two needed to go back to the drawing board on their multi-billion-dollar partnership.

VW's purchase of a near-20 percent stake in Suzuki for $2.5 billion in December 2009 was welcomed by investors who expected Volkswagen to gain an inside track into Suzuki's leading small-car technology, while Suzuki would have access to Volkswagen's hybrid and other advanced technologies that it would not be able to afford on its own.

More than 18 months on, however, no progress has been made, a fact Suzuki Executive Vice President Yasuhito Harayama blamed on Volkswagen's notion it could wield influence over Suzuki's management.
"It was made very clear when we tied up with Volkswagen that we did not want to become consolidated, and that we would remain independent," Executive Vice President Yasuhito Harayama, in charge of relations with Volkswagen, told reporters in an interview with Suzuki's four new executive vice presidents on Monday.

"We feel we need to return to the starting point, including over the ownership ratio," said Harayama, a former bureaucrat at Japan's economy and trade ministry hired by Suzuki two years ago. "The understanding that we are independent companies, and equal partners, is the absolute prerequisite in pursuing any specific cooperation."

Numerous reports since late last year have suggested Volkswagen was looking to bring Suzuki, Japan's No.4 automaker, under its control.
Harayama also said Volkswagen had classified Suzuki in its annual report as a company consolidated under the equity-accounted method over which it could have "great influence".

Suzuki Chief Executive Osamu Suzuki had insisted at the time of the deal on being equal partners, limiting Volkswagen's stake to 19.9 percent. Suzuki has been gradually buying shares in the German automaker as part of the cross-shareholding agreement.

NO PROJECT WITH VW NOW
Harayama's remarks echoed the views expressed by CEO Suzuki in a recent blog, published on the Nikkei newspaper's online site.
"The two companies' sizes differ vastly in size, so maybe with the passage of time they get the misguided notion that they have brought Suzuki under the VW umbrella," the outspoken 81-year-old CEO wrote in the blog, published on July 1.

Having perused Volkswagen's technologies, the automaker "found nothing that it wanted right away", Suzuki also said the blog. In a back-handed compliment, Suzuki goes on to say he was "relieved" that Volkswagen had reportedly made progress in developing a low-cost car without Suzuki's help for South America and India.

Volkswagen, Europe's largest automaker, has ambitious plans to overtake Japanese rival Toyota Motor as the world's No.1 player by 2018.
Harayama stressed there were other automakers who were willing to work with Suzuki on an equal footing, and that Suzuki would continue to pursue operational tie-ups with a broad range of companies while holding back on any projects with Volkswagen until the two can reaffirm their initial understanding.
"Right now, there is no specific joint development project going on with Volkswagen," Harayama said.

Last month, Suzuki announced a deal to buy 1.6-litre diesel engines from Italy's Fiat for a car to be built in Hungary -- a deal that both Suzuki and Harayama said proved the automaker could do without Volkswagen.
After an initial spike, Suzuki shares have lost ground since the Volkswagen deal, falling as much as a quarter to current levels around 1,827 yen and underperforming the broader market. Japanese markets were closed on Monday.

Source: Business News - Indian Stock Market, Stock Market News, Business & Finance, Market Statistics | Reuters India

[vina]

This was probably imminent: you can see a full tbhp debate raging here:

http://www.team-bhp.com/forum/indian...-vw-india.html

[vina]

There is a new development : check this thread out:

http://www.team-bhp.com/forum/indian...rtnership.html