AUTO INDUSTRY NEWS

Volkswagen, Suzuki partnership ends after four-year dispute

Volkswagen, Suzuki partnership ends after four-year dispute image

Text: Martin Aguilar / Photos: Inigo Roces | posted September 02, 2015 09:19

Partnership between VW, Suzuki deemed terminated

The six-year tie-up between Volkswagen and Suzuki has come to an end as an arbitral tribunal confirmed that the German automaker met contractual obligations.

As a review, the said partnership was announced in 2009 and the two automakers agreed to develop an environment friendly compact cars. However, Suzuki accused Volkswagen of withholding information in 2011. In addition, the partnership worsens as the Japanese automaker purchased diesel engines from Fiat to power its SX4 crossover.

In this regard, the arbitral tribunal ruled Volkswagen to sell its 19.9-percent stake in Suzuki. Furthermore, the court also stated that Suzuki breached its contractual obligations to Volkswagen and said that the German automaker has right to claim damages.

The arbitration court also confirmed that Suzuki committed an infringement of the agreement as the Japanese automaker failed to give Volkswagen a “last-call” rights for the delivery of diesel engines.