“According to the Wolfsburg grapevine, the Volkswagen Group is set to increase its 19.9 percent share in Suzuki by ten percent annually over the next four to five years,” says Automobile Magazine in Ann Arbor, Michigan. And they immediately ask: “What for?” Right.
First of all, my personal Wolfsburg grapevine comes up dry as far as the story is concerned. The grapevine says it had never heard of such a plan. Of course, the grapevine also says: “In these matters, we usually are the last to know. We usually read it in the paper.”
Automobile Magazine speculates that the rumored increase in shareholdings is for all kinds of things, such as a Japanese version of the Up! (or Lupo, as it will be called), or Suzuki’s SX4 as the underpinnings for small VeeDub Polo-based crossovers. Even Automobile Magazine can’t believe the last one: “Will VW spend the money to develop a brand-new body for four brands?” Especially not for crossovers that are not more than cars with added macho.
My take: Whatever exchange of DNA matter there may happen, it does not necessitate larger shareholdings. For ages, VW built the Volkswagen Sharan together with Ford’s Galaxy in a joint venture plant in Portugal. Their Routan, FWIW, is a badge-engineered Chrysler. All kinds of cooperations can and are being done without big share deals. Sure, a little share swap makes it feel more serious, but why overdo it?
The only reason for more shares would be more control: If Volkswagen would buy 10 percent annually of Suzuki over four to five years, that would give them a majority in Suzuki in three years. Osamu Suzuki may be “80, going on 56” as Reuters had it, but quite possibly he may also want to enjoy his golden years on a pile of gold. Suzuki would be part of the Volkswagen Group. The perfect Plan B for when VW can’t complete their Strategie 2018 under their own power. Last year, Toyota made 7,234,439 units, Volkswagen sold 6,290,000, and Suzuki 2,387,533. A combined Volkswagen/Suzuki would have sold 8,677,533 units in 2009, Strategie 2018 completed 9 years before plan. Suzuki would finally be somebody in China, Volkswagen would get somewhere in India. The perfect Axis for world domination. This time, without the Italians.
This time, without the Italians.
The SX4 was co-developed by Suzuki and Fiat and also sold in Europe as the Fiat Sedici.
Seems the Italians beat the Germans to it as far as Japanese mini-crossover collaborations are concerned.
I knew it, I knew it …. history repeats again ….
They also bought Lamborghini… which is Italian.
Edit: almost forgot… and Italdesign/Giugiaro
Volkswagen is one of the few automotive companies which has, by and large, been successful at acquiring other automotive companies and then making a go of it. Audi, Skoda and Bentley all came into the fold that way. Bringing Suzuki under the tent makes sense as well, and adds important missing puzzle pieces in Japan and India.
It is fascinating how VW has been able to pull off the acquisition thing multiple times, whilst BMW and Daimler have spectacularly bungled their every attempt to do so. BMW blew it with Rover and has pretty much blown it with Rolls as well. Daimler has Chrysler and Mitsubishi term sheets hanging on its wall of shame. VW, on the other hand, doesn’t seem to have a single acquisition train wreck. Amazing.
I wouldn’t call Seat a roaring success.
You beat me to it.
“I wouldn’t call Seat a roaring success.”
True. However, Seat was acquired shortly before Gorbachev* brought down the iron wall, which changed the basis for doing business in Europe. I doubt that VW would have acquired it, had it been up for sale after that event. Unlike BMW and Daimler, they did not acquire any more manufacturers based in high-cost places like UK or US. Instead, they were fastest on their feet with Skoda, which was clearly the best opportunity in the Eastern bloc. Everything else is far away, plus the Czech have a strong tradition of workmanship and engineering.
*sorry, but no, it wasn’t Reagan
It was Reagan’s (and to an extent Thatcher’s) hardline stance that pushed Gorby in the right direction. If spineless Carter had been re-elected in ’80 the eastern bloc would still be pulling around their Trabants with mules.
How dare you speak ill of Ronald Reagan! He is America’s greatest president and single-handedly destroyed the Soviet Union, saved America and reignited the sun when it stopped burning that one time in 1986.
“…and reignited the sun when it stopped burning that one time in 1986.”
So he’s responsible for global warming, too!
No, W is responsible for global warming. He was the prez that extended daylight savings time by a few weeks a year on each end. More daylight, more sun, more heat.
GW Bush, for global warming. Thanks for the laugh!
Seat is a problem child for sure. Even Babe Ruth struck out a lot of times. Name one auto company which has as good a batting average at acquisitions in modern times as VW does?
BTW, once upon a time, GM was brilliant at the acquisition game as well, but GM lost that plot over fifty years ago.
I’d say VW rather spectacularly bungled the attempt to acquire Rolls Royce. Bought the company, but failed to get the rights to the name. Had to pass it over to BMW, since the assets without the name weren’t worth squat.
Hmph, Suzuki scores a hit with the Kizashi and then VW shows up to drive their quality into the ground. If I was Suzuki I’d resist to my last breath.
Suzuki quality? What?
“Suzuki scores a hit with the Kizashi …. ”
Surely you jest!