#alliances

Hyundai and Kia are technically separate companies, with Hyundai owning less than 50% of its junior partner. But as the two major divisions of the Hyundai-Kia Motor Group, the two firms share resources and align their strategies through carefully-maintained relationships in the classic Korean chaebol (conglomerate) fashion. Hyundai has long been the senior partner in the relationship, getting the newest technologies and the most expensive new cars. But in both Korea and abroad, Kia is beginning to catch up with its big brother, raising questions about the future shape of its delicate relationship. Together, Hyundai and Kia enjoy a dominant position in Korea, earning 45.2% and 33.2% of the overall Korean market in 2010 (including commercial vehicles). But if you just look at sedans and SUVs, the Korea Herald reports that their 2010 market share numbers are much closer: 39.6% and 35/7% respectively, and converging

Hyundai Motor Group is focusing on the possibility that Kia will catch up with Hyundai within one year in terms of monthly market share ― for sales of sedans and sport utility vehicles ― domestically for the first time…

The gap for sales of sedans and SUVs have continued to narrow ― 22.9 percentage points in 2007, 17 percentage points in 2008, 15.4 percentage points in 2009 and 3.9 percentage points in 2010.

And this fresh-brewed sibling rivalry isn’t just about Korea: around the world, Kia is catching up. And this shifting relationship is shaking things up at the highest levels of the group’s leadership.

Spyker, the high-end sportscar firm formerly run by Saab “savior” Victor Muller, has been sold to North Street Capital, a US-based private equity firm, reports the FT [sub]. According to the FT,

North Street said in a draft announcement seen by the Financial Times and due to be released later on Wednesday that “the transaction is expected to strengthen [Spyker] in its efforts for new product development and stronger positioning in its factory auto racing team”. No changes in Spyker’s operations are planned. Terms were not disclosed.

Muller had planned to sell Spyker to Vladimir Antonov, Saab’s erstwhile knight in shining ( or not) armor but Antonov ran while he could, and now plans to build a modern interpretation of the Jensen Interceptor. Under the proposed sale to Antonov, Spyker was worth “€15m plus an “earn-out” worth up to €17m to be paid over six years,” but because the firm hasn’t produced a single car since 2009, it’s probably been sold for considerably less than that. The firm sold 36 units in 2009, and has never been profitable, losing about $300m last year (while trying to swallow Saab), and about $30m in 2009. In a 2009 interview with TTAC, Muller had targeted “2010 or 2011” as his goal for turning a profit with Spyker, but thanks to the distractions surrounding the Saab “rescue,” it seems safe to assume that goal is nowhere in sight. Which is probably why the FT reports that

A person familiar with the North Street deal said that Swedish Automobile’s talks with CPP had collapsed.

Anyway, best of luck to North Street. Meanwhile, if the financial nightmare part of this story doesn’t particularly interest you, you can always check out Jack Baruth’s review of the $270k Spyker C8 Aileron here.

Suzuki today sent a letter to Volkswagen, demanding a retraction of the allegation that Suzuki breached its contract with Volkswagen. Reuters calls the letter an escalation of “a war of words as it tries to break off equity ties with its estranged partner.” And the tone of the letter definitely sounds belligerent:

Reuters reports:

Opel, part of GM Europe, has long sought to free itself of the constraints imposed by GM, which aims to keep it as a regional brand.

“One proposal would be to give Opel shares to SAIC,” [Opel union boss] Klaus Franz told Reuters, adding this move would allow GM to receive in return t he 1 percent in the SAIC joint venture it is missing for a 50 percent stake.

“GM has never accepted that it owns 49 percent in the joint venture with SAIC and that the Chinese partners have 51 percent,” Franz said.

The joint venture builds Chevy, Buick and Cadillac vehicles in China.

“It would be a win-win situation for all and it would be a good way for us to enter the Chinese market,” Franz said.

Franz has long been a provocateur, but this one probably takes the cake. After all, SAIC and Opel together would almost be a better GM than GM… product development and booming China/India sales with none of the North American legacy costs. Don’t count on this happening, but it is an interesting sign of Opel’s renewed desire for independence from Mother GM.

Will they or won’t they? That’s currently the talk amongst Germany’s auto execs. “They” are Volkswagen and Suzuki. And “will” refers to taking over Suzuki against its will. Yesterday, Der Spiegel, reported that Volkswagen is no longer barred from taking over Suzuki if Suzuki cancels its contract. Der Spiegel, of course, heard that from an interested party that telegraphs to Hamamatsu. “Be careful what you wish for.” Nonetheless, the rumor mill is at high revs. Let’s investigate.

Interesting twist in the Volkswagen-Suzuki sopu opera (see, Japanese is easy!): Suzuki could be doing Volkswagen a favor by filing for divorce. This way, Volkswagen can swallow Suzuki whole.

Despite saber-rattling, legal threats and affirmations that Volkswagen does not intend to give up its share in Suzuki, Volkswagen started its climbdown. Ferdinand Piech himself signaled that Volkswagen can go it alone. At the Frankfurt Auto Show, Piech said that Volkswagen is “big enough.” His man Winterkorn quickly fell in step and told Reuters today: “”Suzuki was one option. But we can do it on our own.”

That should be signals enough for everybody at Volkswagen to put the Suzuki saga behind themselves and to concentrate on other pressing business, such as the messy Porsche merger.

Back in Tokyo, The Nikkei [sub] wrote what seems to be Suzuki’s version of the story.

Volkswagen will almost certainly finish the year as the second-largest automaker by volume… and if it wants to take the top spot, it will do so on sales, not acquisitions. Having gobbled an extraordinary number of acquisitions over the past several decades, including Bentley, Lamborghini, Bugatti, Italdesign and Karmann, VW’s monstrous appetite appears to be waning. And no wonder: the latest mouthful, a partnership with Suzuki, has gone sour and recent lustful glances at Alfa have drawn sassy rebukes from Fiat’s Sergio Marchionne. Accordingly, VW’s Chairman Ferdinand Piech tells Bloomberg [via AN [sub]] that no more acquisitions are planned and that

We’re big enough

Of course, this is also coming from the company that’s been struggling to swallow Porsche for the last several years. Once that deal is complete, we’ll check back on Herr Piech’s appetite. Because in an industry built on scale, you never know when hunger will strike…

Dieter Zetsche and Carlos Ghosn had their intimate luncheon with selected members of the Fourth Estate today. It took place in the not so fancy, but highly convenient Maritim Hotel, which has a prized asset: A private entrance to the Frankfurt Motor Show. It, and the Marriott across the street, are the hottest properties in Frankfurt during Motor Show days. The TTAC-dispatched fly-on-the-wall reports from the luncheon:

Daimler and Nissan may announce some serious platform sharing, t.b.a. either today or tomorrow on the sidelines of the Frankfurt Motor Show. Bloomberg has heard that Daimler “is considering sharing its small-car platform with Nissan Motor Co.’s Infiniti brand.”

„It is like being married and getting a divorce. Instead of criticizing each other, it is better to go through it with a smile,” Suzuki’s patriarch chairman Osamu Suzuki told reporters at a hurriedly arranged press conference in Tokyo today. And a divorce it is: Suzuki announced it will terminate its relationship with Volkswagen after a nearly 2 year unhappy and childless marriage.

In a news release, Suzuki announced that “its board of directors has officially determined today dissolution of the comprehensive partnership and the cross-shareholding relationship with Volkswagen AG. “ Here is a short version of the long list of reasons given in the divorce papers (known as the “green form” in Japanese matrimonial matters):

Dow Jones cites a report in Der Spiegel Magazine which claims that GM Vice Chairman for Corporate Strategy Steve Girsky

has made enquiries at BMW to start discussions on “far-reaching joint projects.”

According to Dow Jones, the Spiegel article does not cite any specific source for its information, and TTAC has not yet been able to find the original article online. According to Dow Jones, GM is

primarily interesting in gasoline and diesel engines… General Motors is at an advanced stage in developing a fuel cell and could offer co-operation in that field… The technology behind GM’s Opel Ampera electric vehicle would also be of interest to BMW, according to the report.

GM has not yet responded to TTAC’s request for comment. A similar r umor was floated by Handelsblatt around this time last year, but BMW was quick to quash it. Are things different this time, or is GM still struggling with unrequited desire? We’ll let you know as soon as possible…

In the long simmering conflict between Suzuki and Volkswagen, the gloves are coming off and we are having a bit of domestic violence. Volkswagen just said in an emailed statement:

“The review of the partnership with Suzuki Motor Corp announced by Volkswagen Aktiengesellschaft has brought its first results. Volkswagen stated in Wolfsburg on Sunday that the company is serving notice of an infringement by Suzuki of the cooperation agreement concluded in December 2009.

GM tightened its ties with Volt battery cell provider LG this week, announcing a deal to jointly develop next-generation electric vehicles. GM, along with the other Detroit-based OEMs, have been seeking closer ties with their suppliers, and as the JoongAng Daily reports, this deal helps LG at a time when the Korean conglomerate has been struggling

Two of LG’s pillars – LG Electronics and LG Display – are floundering. LG missed the boat on smartphones and persistently-low prices of display panels have plagued LG Display.

LG officials are hoping the EV project will give it momentum.

And though it’s no surprise that GM wants to move into the pure-EV market, its gamble on the extended-electric Volt has backed it into something of rhetorical corner.

Today’s announcement of a memorandum of understanding between Ford and Toyota, uniting the two firms’ pickup truck hybrid drivetrain efforts, took quite a few industry-watchers by surprise this morning. As the industry leader in hybrid technology, Toyota has limited past hybrid cooperation to licensing its drivetrain wholesale to Nissan and a patent-sharing agreement with Ford. Moreover, the last big alliance aimed at developing hybrid technology for full-sized pickups, the Two-Mode V8 hybrids developed jointly by GM, Chrysler, Mercedes and BMW, have been a huge flop on the market, with the German partners walking away from the technology after using it in only a single application each (X5/X6, and ML Hybrid). Though Toyota and Ford have worked together to prevent a messy patent war over hybrid technology, there was little to suggest that they would take the cooperation any further, let alone join forces to hybridize full-size pickups. But if you’re looking to the marketplace to explain the Ford-Toyota tie-up, you’re looking in the wrong place: this is all about the freshly-announced CAFE standard and its generous credit system.