By on August 5, 2015

2013 Volkswagen Jetta Hybrid, Exterior, Front 3/4, Picture Courtesy of Alex L. Dykes

In a detailed report on the failed alliance between Suzuki and Volkswagen, Automotive News reports that the Japanese automaker wanted to re-badge and sell Volkswagen Jetta Hybrids in the U.S. before the company eventually decided to close up its local sales arm.

The report, which came out on Monday, is a play-by-play of what happened from the time Suzuki CEO Osamu Suzuki and Volkswagen AG CEO Martin Winterkorn first shook hands in 2009, to when Suzuki announced it was cutting its losses, up to today as the automakers struggle over VW’s 19.9-percent ownership of the Japanese automaker.

The original agreement, which would open the door for Suzuki to use advantaged Volkswagen powertrain technology while also giving VW a view into Suzuki’s Indian success, is said to have not been respected by Volkswagen.

From Automotive News:

“The alliance is meaningless,” Harayama told his interlocutor, according to internal Suzuki documents chronicling the demise of the alliance that were obtained by Automotive News.

“Our engineers have lost the desire to cooperate with VW.”

A tipping point, Harayama added, came during an earlier top management meeting. The Suzuki side presented VW CEO Martin Winterkorn a list of complaints. But the tactic backfired.

According to Suzuki’s version of events, instead of contemplating Suzuki’s suggestions for mending relations, the ticked-off German surprised the Japanese by pounding the table in irritation.

“With this, we understood that it is impossible to work with top management to resolve the front-line problems,” Harayama told an off-guard Wittig, who insisted he hadn’t come to the meeting to negotiate with Harayama. “We want a ‘yes’ or ‘no’ answer about whether we will hold joint discussions,” Harayama demanded before excusing himself to catch his flight home.

The conclusion of the failed alliance won’t be known until a decision is made by the ICC International Court of Arbitration. However, there are some interesting tidbits to take away from the report, such as Suzuki’s want for Volkswagen cars to badge as their own.

At one point in the negotiations, Suzuki hoped VW would supply its Jetta Hybrid sedan and other vehicles through Suzuki’s North American sales network, the documents revealed. Tweaking its own cars to meet American specifications increased Suzuki’s development man-hours by half.

“It is becoming difficult for Suzuki, a company focused on compact cars, to bring together a North American product line sufficient to continue operating a N. American sales network,” Suzuki said in one document before the tie-up that outlined the items it wanted incorporated into a VW agreement. “The development cost burden is heavy.”

If you have a chance (and a subscription to Automotive News), the report is worth a read. However, you might want to read Matt Hardigree’s take on reading business stories immediately after.

 

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6 Comments on “Suzuki Wanted to Sell Re-badged Jetta Hybrid in the US...”


  • avatar
    DeeDub

    …first shoot hands in 2009…

    Spellcheck is not an editor.

  • avatar
    MRF 95 T-Bird

    They should have just offered a new Swift, Kizashi and revised SUV/CUV’s.

    • 0 avatar
      Demetri

      Still miffed we didn’t get the Swift. The Swift Sport is supposed to be like a Japanese MINI.

      https://en.wikipedia.org/wiki/Suzuki_Swift#/media/File:Suzuki_Swift_Sport_%28FZ_NZ%29_%E2%80%93_Frontansicht,_3._September_2012,_D%C3%BCsseldorf.jpg

    • 0 avatar
      MRF 95 T-Bird

      The Swift 3dr sport is quite attractive especially compared to penalty boxes Versa and Yaris. They could have stayed here in the states as a Scion like entry level value brand or old Subaru “Inexpensive and built to stay that way”.

  • avatar
    ciscokidinsf

    Hmm, Poor Suzuki, every partnership they try ends up like shit:

    The GM-Suzuki partnership had good days (Geo Metro and Tracker) but when GM forced Suzuki to sell Daewoo Crap under its own name, it was too much. You can even see the long term data on the cars – Suzuki made – good – Daewoo made = utter crap. That’s why I dont trust the Cruze just yet.

    Now VW just left them hanging. VW was being their usual germanic selves and Suzuki needed faster moves and had less time to spare. Suzuki is a bit like Honda (one-country hit wonder) and you can totally see that they needed VW a lot more than VW needed Suzuki.

    The Kizashi and the Jetta are very similar in size and dimensions, I even remember the early discussions on the VW-Suzuki partnership on perhaps launching the Kizashi with the 2.5 5 cyl or V6 engines from VW. Not a damn thing happened.

    Suzuki makes great small cars and small CUVs but they really have outdated engines and no tech. The Kizashi is their flagship car, its great at driving, but it fails in other ways. I love my Kizashi but the 4 cyl 2.4L is thirsty and old and the electronics are state of the art for 2005. A kizashi with some VW bits would have been awesome.

    But now… if Suzuki is now solo again, Who’s next? I’ve heard Sergio will merge FCA with whoever looks at him in the eyes…

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