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Volkswagen Takes 19.9% Stake In Suzuki

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Volkswagen has previously professed a desire to become the largest carmaker in the world, and of late, it's been looking like a realistic goal. With the recent acquisition of Porsche and the topsy-turvy market that is 2009, Volkswagen has already beaten Toyota in total global output. Today VW officially added even more to its global empire with the acquisition of 19.9 percent of Suzuki.

VW also recently nabbed the Car of the Year award in Europe for the Polo small car, which will be headed to the U.S. soon, so getting a stake in Suzuki could position VW to help further expand its small-car reach. Suzuki is undeniably successful in the small-car arena with its Kei cars in Japan and similar small vehicles in India. Neverthelses, the 2010 Kizashi, which may be the company's best car ever, is a borderline compact/midsize sedan. Read up on the Kizashi with our review here.

The acquisition of a 19.9 percent interest in Suzuki opens the door to materials and parts sharing between the two companies, enabling VW to make small cars more cheaply and Suzuki to improving the quality and variety of its offerings, while potentially lowering the CO2 footprint of both carmakers.

Taken in light of VW's plans for expanding its global presence and market share, the partnership with Suzuki makes a lot of sense, as smaller cars will sell more quickly and more numerously in rapidly emerging Asian and Southern Hemisphere markets.

[VW & Suzuki]

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Comments (8)
  1. I can see it now, the next gen SX4 powered by a 1.8L inline 4 VW engine.
     
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  2. I'm not sure what VW would get out of the deal. They already have cheap brands, already have a line of small cars, and already has a presence in China. VW is quickly becoming the new GM. Too many brands under one roof that compete with each other for the same customers.
     
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  3. i cant stop myself from not saying this. today i saw 20 – 30 ARMY HUMMERS refueling at petronas near LDP. theyre f**kin awesome and theyre are brand new~!! woohoo are they ours or thais? or s’pores? gone tax money gone~!
     
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  4. ginko Suzuki is able to produce small cars cheaper then VW
     
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  5. "I'm not sure what VW would get out of the deal."
    By gaining ownership of Suzuki, VW becomes a JDM manufacturer and gains better access to that market - both from a manufacturing standpoint but also their dealer network. In addition, VW gains immediate access to existing technology for sub 1-liter engines from Suzuki's Kei cars and Motorcycles - engines which will be more widely used as smaller cars become more accepted worldwide.
    The benefit of partnering with Suzuki specifically rather than say Honda is that Suzuki is accustomed to being a minority player - they'll accept the corporate cultural differences and demands from Wolfsburg in their stride rather than putting up a fight like a major player who has been accustomed to their autonomy might.
    Meanwhile, Suzuki gains access to huge portfolio of existing quality platforms and deep pockets from the parent company to aid in their expansion efforts.
     
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  6. I agree with the under one liter car thing, but don't forget that VW is now trying to get into the truck market and Suzuki has more experience designing and building light trucks.
     
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  7. Forgot that Suzuki also has some India marlet share and all automakers want to expand there, as they are gonna boom like China's auto market did.
     
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  8. That isn't exactly how Volkswagen sees it, though. The company wants to overtake Toyota as the number one automaker worldwide by 2018 and would love to see Suzuki count towards that goal. This is the good progress of company.
     
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