Should it be Volkzuki or Suzuwagen?

Volkswagen and Suzuki have begun a bit of a love-in. Volkswagen CEO Martin Winterkorn probably explains it best, “Two of the world’s leading car makers are joining forces and preparing to meet the growing challenges that lie ahead. Together we can maximize our opportunities for growth. We are proud to be cooperating with such an esteemed and valued partner.”

In financial terms the partnership will see Volkswagen purchase 19.9% of Suzuki. In return, Suzuki will use up to half of the received funds to buy shares in Volkswagen. I’m sure that makes sense to greater financial minds than mine.

In production terms, well, nothing concrete is given away in the statement below, but expect the two companies to work together on producing cheap fuel efficient entry-level cars, with low CO2 emissions, for the developing world.

Two statements are available after the break, the first one from Suzuki, the second from Volkswagen.

VW and Suzuki Enter Comprehensive Partnership

Volkswagen AG (Wolfsburg, Germany “Volkswagen”) and Suzuki Motor Corporation (Hamamatsu, Japan “Suzuki”) have reached a common understanding to establish a comprehensive partnership. A framework agreement has been signed by representatives of both companies today.

In terms of global presence and product diversity, the partnership marks an important step towards the future for both Volkswagen and Suzuki. In terms of product portfolio, global distribution and manufacturing capacities, Volkswagen and Suzuki ideally complement each other. The companies plan a joint approach to the growing worldwide demand for more environmentally friendly vehicles. The management of Volkswagen and Suzuki have concluded that the complementary 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.

In the automotive industry, where globalization and diversification proceed in parallel, both companies will establish a cooperative relationship while respecting each other’s independence as a stand-alone entity. 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.

To support a smooth development of this relationship, Volkswagen will purchase 19.9% of Suzuki’s issued shares. The Closing of the transaction is subject to approval of the relevant authorities and is expected in January 2010. Suzuki intends to invest up to one half of the amount received from Volkswagen into shares of Volkswagen. Both companies will form a long-term strategic partnership based on this which will support their successful strategies in these challenging times.

“Two of the world’s leading car makers are joining forces and preparing to meet the growing challenges that lie ahead. Together we can maximize our opportunities for growth. We are proud to be cooperating with such an esteemed and valued partner”, Volkswagen CEO Martin Winterkorn said.

Mr. O. Suzuki spoke that “We were very much impressed about the enthusiasm of Volkswagen towards manufacture of splendid automobiles. The companies shall cooperate taking advantage of the strength of the other with the maximum consideration to the global environment. We will also continue to extend our utmost efforts for customer satisfaction.

As demand continues to rise for smaller cars and for powertrains with higher fuel efficiency and lower CO2 output, Volkswagen and Suzuki will offer a compelling solution for customers in emerging markets buying a car for the first time and also for customers in advanced economies seeking to lower their CO2 footprint while still enjoying the freedom of transport offered by an exciting range of cars.

Volkswagen and Suzuki Agreed to Establish a Comprehensive Partnership

• Important step towards the future for both companies

Volkswagen Aktiengesellschaft and Suzuki Motor Corporation have reached a common understanding to establish a close longterm strategic partnership. A framework agreement has been signed by representatives of both companies on 9 December.

In terms of global presence and product diversity, the partnership marks an important step towards the future for both Volkswagen and Suzuki. In terms of product portfolio, global distribution and manufacturing capacities, Volkswagen and Suzuki ideally complement each other. The companies plan a joint approach to the growing worldwide demand for more environmentally friendly vehicles. The management of Volkswagen and Suzuki have concluded that the complementary 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.

In the automotive industry, where globalization and diversification proceed in parallel, both companies will establish a cooperative relationship while respecting each other’s independence as a stand-alone entity. 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.

To support a smooth development of this relationship, Volkswagen will purchase 19.9% of Suzuki’s issued shares. The Closing of the transaction is subject to approval of the relevant authorities and is expected in January 2010. Suzuki intends to invest up to one half of the amount received from Volkswagen into shares of Volkswagen. Both companies will form a long-term strategic partnership based on this which will support their successful strategies in these challenging times.

As demand continues to rise for smaller cars and for powertrains with higher fuel efficiency and lower CO2 output, Volkswagen and Suzuki will offer a compelling solution for customers in emerging markets buying a car for the first time and also for customers in advanced economies seeking to lower their CO2 footprint while still enjoying the freedom of transport offered by an exciting range of cars.