Suzuki to abort VW partnership

Suzuki to abort VW partnership

September 13th, 2011 by Staff Report in Business Around the Region

The VW logo is seen on the front of one of dozens of new Passats made at the Chattanooga Volkswagen assembly plant parked outside the plant. These cars will be used as demos for testing, internal quality control and press test drives.

Suzuki Motor Corp. said Monday it will abort its alliance with Volkswagen AG following a nearly two-year marriage that never worked.

Even at what appeared to be the end of the union, the two companies seemed unable to agree as Volkswagen said it wanted the cooperation to continue.

Suzuki's board of directors decided to dissolve its partnership with the German automaker because of concerns that it would lose autonomy. Volkswagen owns a nearly 20 percent stake in Suzuki, while Suzuki holds about 1.5 percent of Volkswagen.

Suzuki said it would ask Volkswagen to unload its Suzuki shares, which it would then buy back with its own financing, and that it would do the same with its Volkswagen shares if the two reach agreement.

"We have no plans to sell our stake in Suzuki," Volkswagen spokesman Michael Brendel said in a telephone interview.

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