Volkswagen buys stake in Suzuki!

Volkswagen’s vociferous appetite to add brands to its stable has seen it buy a 19.9% stake in Suzuki, barely days after finalising a deal to buy 49.9% of Porsche. This latest US$2.5 billion deal is, what VW calls “a comprehensive partnership” where “both companies will establish a cooperative relationship while respecting each other’s independence as a stand-alone entity,” says Wolfsburg. Suzuki is set invest up to half of the sum received into buying VW shares in an arrangement that’s similar in spirit to the Renault-Nissan Alliance.

“In terms of product portfolio, global distribution and manufacturing capacities, VW and Suzuki ideally complement each other. The strengths of each company make for a perfect fit in exploiting their respective advantages as well as rising to the challenge of the global market. Both parties are focused on achieving synergies in the areas of rapidly growing emerging markets as well as in the development and manufacturing of innovative and environmentally friendly compact cars,” the official press statement reads.

Sounds like good news for markets like India, where Suzuki is a market leader with the Maruti brand. Imagine a inexpensive modern compact car based on the Volkswagen up! riding on Maruti’s extensive network – Mr. Ratan Tata might not sleep so well if something like that takes off!

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