Hungry Volkswagen adds Suzuki to its stable!

maruti suzuki a star

The tale of the hungry giant called Volkswagen continues! Days after acquiring majority stake in Porsche, Wolfsburg has announced the purchase of 19.9% of Suzuki for US$2.5 billion. The deal, which is billed as “a comprehensive partnership” will also see the Japanese manufacturer invest up to half of the sum received into buying VW shares. This cross buying arrangement sounds similar to the Renault-Nissan Alliance. Both companies will establish a cooperative relationship while respecting each other’s independence as a stand-alone entity, says VW.

“In terms of product portfolio, global distribution and manufacturing capacities, VW and Suzuki ideally complement each other. The strengths of each company make for a perfect fit in exploiting their respective advantages as well as rising to the challenge of the global market. Both parties are focused on achieving synergies in the areas of rapidly growing emerging markets as well as in the development and manufacturing of innovative and environmentally friendly compact cars,” the press statement reads.

Volkswagen Up! Lite

This partnership has real potential to upgrade the standard of motoring in developing markets. Think about it; Suzuki is a small car expert and VW is among the best in making efficient, frugal and clean drivetrains, and the merger of these qualities could bring about a revolution greater than the Tata Nano.

Conveniently, Suzuki is the market leader in India with its Maruti brand and VW is deep rooted and hugely successful in China, so both sides have something great to offer the other. We reckon that the fruits of this marriage will be really sweet – how about a Maruti up! or a next gen Swift Sport with a 1.4 TSI engine?

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Danny Tan

Danny Tan loves driving as much as he loves a certain herbal meat soup, and sweet engine music as much as drum beats. He has been in the auto industry since 2006, previously filling the pages of two motoring magazines before joining this website. Enjoys detailing the experience more than the technical details.

 

Comments

  • firdausyusof on Dec 10, 2009 at 2:34 am

    waaa, now the monster really hungry…..

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  • great news..hope we can have suzuki cars with VW engine soon!of coz with reasonable price..!!

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  • Gajen on Dec 10, 2009 at 2:47 am

    they should bring alto here….or they should make alto sport…give the i10 a fight

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  • Darius Drake on Dec 10, 2009 at 3:11 am

    With VW officially the world's largest carmaker (for now), they definitely would want to strengthen that position and hold on to it longer by buying up stakes in as many marques as possible while the opportunity is present.

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  • VW Kizashi 2.0 TSI for Malaysia, made in Tanjong Malim, price tag RM 140k. Ain't this brilliant?

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  • trav_da_man on Dec 10, 2009 at 3:20 am

    I have a feeling pretty soon proton will join the Volkswagen family.

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  • Alan Ng on Dec 10, 2009 at 3:25 am

    In the previous VW-Porsche post, VW bought over 49.9% of Porsche's shares for 3.9 billion euros. This means total value of Porsche is at 7.8 billion euros ~= USD11.5billion. 19.9% of Suzuki's shares are valued at USD2.5billion. This means total value of Suzuki stands at USD12.5billion. Who would have thought that Suzuki is worth more than Porsche. But of course, Porsche is well known for having the highest profit margin per car sold:)

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  • I have a feeling with the aquisition of Suzuki, VW will stop it's buying binge for now. They have all the pieces in place, everything from the ultra high end Bugatti, to the ultra low end Suzukis. I am looking forward to seeing some affordable CKD Suzuki's with TSI and/or DSG. They'll be the Skodas of Asia.

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  • littlefire on Dec 10, 2009 at 6:56 am

    I can imagine that Suzuki Swift Sport with 1.4 twincharge TSi engine + 7-speed DSG in it… Wah…

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  • CCC said,

    December 9, 2009 @ 7:14 pm

    'VW Kizashi 2.0 TSI for Malaysia, made in Tanjong Malim, price tag RM 140k. Ain’t this brilliant?'

    No, I would prefer to see it manufactured and build in Malaysia… ;)

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  • Sorry, I clicked the 'submit' button too fast..

    I meant not only build a CKD car, but completely manufactured in Malaysia, including the TSI engine… ;)

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  • looks like vw is really on a spree. they really have so much funds to buy into companies after companies eh.

    but it is a good deal considering both sides have good stuff to offer to each other.

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  • oh, this doesn't look too good…

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  • mystvearn on Dec 10, 2009 at 12:31 pm

    Reminds me of GM in 90s. The bigger they are, the harder they fall

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  • Chris R on Dec 10, 2009 at 2:21 pm

    What's the problem. They both have a record of providing good cars at an economical price. Now it GM were part of this deal… then I would be worried.

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  • Boink on Dec 10, 2009 at 7:21 pm

    another Giant rising, but i'd reckon the Germans would run shows way better then 'credit loving' Americans

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  • squawk on Dec 10, 2009 at 7:25 pm

    Now that VW has an Asian brand and presence in the key Asian markets, do they need to "talk" with any other carmakers here?

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  • Boink on Dec 10, 2009 at 7:26 pm

    China – largest population (conquered by VW's)

    India – 2nd largest population (conquered by Suzi's)

    Wow!! this is HUGE………..

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  • squawk on Dec 10, 2009 at 9:18 pm

    Don't forget they're also now in SEA's largest MPV market – Indonesia. T&H should be having sleepless nights now.

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  • squawk on Dec 10, 2009 at 9:19 pm

    And if they put their Amarok truck in Thailand…. :-)

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  • To those who think that VW is following the same path as GM, think again. GM's corporate culture was run by bean counters with a heavy emphasis on big cars and trucks and ceded way too much to the unions. VW is led by engineering people like Piech in the '90s and now Dr. Winterkorn. GM never had the engineering depth that VW possesses. Looking forward, I think there are now three major powers for the auto industry, VW, Toyota, and Hyundai/Kia. VW and Hyundai/Kia are on the ascendency, whereas Toyota may have peaked already.

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  • mingyuyu on Dec 10, 2009 at 9:46 pm

    VW rocks!!!

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  • Ralph on Dec 10, 2009 at 10:11 pm

    after VW nom-nom porsche, suzuki next…

    and after that they head south and nom-nom proton…

    and along with proton, VW also nom-nom lotus…

    its just the law of nature ^^

    they cannot nom-nom perodua tho…

    coz perodua is toyota's nom-nom…

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