Suzuki Motors have announced that they have terminated their partnership with Volkswagen. Volkswagen bought 19.9% stake in Suzuki Motors in Dec 2009 for a price of $2.5 billion. Suzuki has stated they will buy all their shares back from Volkswagen by Nov 2012. But, Mr Eric Felber, Volkswagen spokesperson, said that his company will not be selling their stake in Volkswagen, which might create a major issue in the auto industry.
Mr Osamu Suzuki, CEO & Chairman, Suzuki Motors said, “Today, Suzuki terminated the partnership with VW. Suzuki will be seeking the return of its shares from VW in arbitration. I am disappointed that we have to take this action but VW’s actions have left us no choice. I am disappointed that having shaken the hand of Dr. Winterkorn (VW Chairman) in agreeing to this partnership, he has not honored his commitment to grant Suzuki access to what was originally agreed.”
Volkswagen and Suzuki started having problems when Volkswagen in their annual report said that they will be influencing operations and financial policies at Suzuki Motors significantly.