Suzuki Will Teach VW Where The Little Cars Come From

Bertel Schmitt
by Bertel Schmitt

When Volkswagen bought a 19.9 percent share in Suzuki, everybody in the know knew that a much bigger trade was going down. A trade of subcontinents. Suzuki owns nearly half of the market in India, where Volkswagen is a relative nobody. Suzuki is dabbling in China, where Volkswagen rules the roost.

So here comes the first real step: Maruti Suzuki India will help Volkswagen AG develop a new small car priced at less than $8,600, reports Bloomberg. Volkswagen knows how to make small cars alright. What they forgot is how to design cheap small cars.

In return for a refresh or corporate memory, Volkswagen will teach Maruti Suzuki how to build the small peppy diesel engines Volkswagen does so well. If Suzuki won’t learn fast enough, they can directly source engines from Wolfsburg.

Suzuki Chairman Osamu Suzuki will come to India later this month. The two companies will make at least three major announcements about joint product development, contract manufacturing and other collaborations. A small and cheap high volume car would be an immense help for Volkswagen in breaking into emerging markets.

Bertel Schmitt
Bertel Schmitt

Bertel Schmitt comes back to journalism after taking a 35 year break in advertising and marketing. He ran and owned advertising agencies in Duesseldorf, Germany, and New York City. Volkswagen A.G. was Bertel's most important corporate account. Schmitt's advertising and marketing career touched many corners of the industry with a special focus on automotive products and services. Since 2004, he lives in Japan and China with his wife <a href="http://www.tomokoandbertel.com"> Tomoko </a>. Bertel Schmitt is a founding board member of the <a href="http://www.offshoresuperseries.com"> Offshore Super Series </a>, an American offshore powerboat racing organization. He is co-owner of the racing team Typhoon.

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