Ruling in arbitration proceedings: Cooperation between Volkswagen and Suzuki deemed terminated


• Arbitral tribunal confirms Volkswagen met contractual obligations and finds that
Suzuki has ordinary right to terminate agreement based on reasonable notice
• Volkswagen to dispose of its 19.9 percent stake in Suzuki and expects positive
effect on Company’s earnings and liquidity from transaction
• Arbitrators also find that Suzuki breached its contractual obligations to Volkswagen
under the agreement and that Volkswagen has right to claim damages



An arbitral tribunal in London has announced its ruling in the dispute between Suzuki Motor Corporation and Volkswagen Aktiengesellschaft. As a result, cooperation between the two parties is deemed terminated. The arbitrators confirmed that Volkswagen met its contractual obligations under the cooperation agreement and found that Suzuki has terminated the agreement upon reasonable notice. Volkswagen will therefore now dispose of its 19.9 percent stake in Suzuki and expects a positive effect on the Company’s earnings and liquidity from the transaction. The arbitral tribunal also confirmed that Suzuki breached its contractual obligations to Volkswagen under the agreement and that Volkswagen has the right to claim damages.

“We welcome the clarity created by this ruling. The tribunal rejected Suzuki’s claims of breach and found that Volkswagen met its contractual obligations under the cooperation agreement. Nevertheless, the arbitrators found that termination of the cooperation agreement by Suzuki on reasonable notice was valid, and that Volkswagen must dispose of the shares purchased. This decision is based on the principle that a contract may be terminated upon reasonable notice. Volkswagen expects a positive effect on the Company’s earnings and liquidity through the sale of the Suzuki shares”, the Group said on Sunday.

Furthermore, the arbitration court confirmed that Suzuki committed an infringement of the agreement. Suzuki broke off an ongoing cooperation project at the end of 2010/beginning of 2011 and failed to give Volkswagen last-call rights for the delivery of diesel engines. Volkswagen reserves the right to claim damages against Suzuki.

In December 2009, Volkswagen and Suzuki agreed to cooperate on the joint development of innovative and eco-friendly budget cars and on expanding their presence in dynamic emerging automotive markets. At the same time as this strategic cooperation was agreed, Volkswagen purchased a 19.9 percent stake in Suzuki. In return, Suzuki purchased approx. 1.5 percent of the ordinary shares in Volkswagen Aktiengesellschaft. In November 2011, Suzuki initiated arbitration proceedings in London.


La corte internazionale di Londra dopo ben quattro anni ha emesso la sentenza sulla contesa tra Vw e Suzuki: i tedeschi dovranno vendere le loro quote ma viene riconosciuto che Suzuki ha violato le regole dell'accordo e che Vw ha diritto ai danni.
Termina così un'alleanza che aveva molte potenzialità ma che e' naufragata miseramente.
Adesso Suzuki può cercarsi un nuovo alleato, FCA forse?

No, Toyota ha quote inferiori al 10% in Subaru, Mazda e Isuzu.

Suzuki plans to go it alone after 4-year dispute with VW ends
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August 31, 2015 11:14 CET
TOKYO (Bloomberg) -- Suzuki now plans to defend its hard-won independence after its failed cooperation with Volkswagen came to an end after a four-year dispute.

Arbitrators upheld Suzuki's request to terminate a 2009 agreement that failed to yield a single joint project with the German company. As a result, Volkswagen will sell its 19.9 percent Suzuki stake, which was valued at about 463 billion yen ($3.8 billion) based on the Aug. 28 closing price.

"The past six years have been a very valuable experience," Chairman Osamu Suzuki, who brokered the deal, told reporters in Tokyo on Sunday. "I came to realize there are companies different from us," and as a result, independence will be a "precondition" for future dealings.

Suzuki, a specialist in inexpensive cars, is smaller than global rivals like Volkswagen, which sells about four times as many vehicles. That puts pressure on the Japanese automaker to safeguard its dominance in India and control rising development costs for green-car technologies, while pursuing a goal to boost annual revenue to 3.7 trillion yen by March 2020.

Rather than pursue other partnerships, Suzuki should focus on its India operations and Maruti subsidiary, said Daniel Loeb from Third Point LLC.

"Any potential partner would be quite worried about what sort of partnership it would have with Suzuki after what happened with VW," said Ashvin Chotai, managing director of researcher Intelligence Automotive Asia. "The culture of Suzuki is not very conducive towards working in a joint venture."

Enough cash

Suzuki has enough cash on hand to purchase the shares held by Volkswagen and should avoid issuing equity or any convertible securities that would lead to dilution for existing shareholders, Loeb told reporters on a conference call. While he and his research team haven't contacted or met with Suzuki management, Third Point plans to continue holding the company's shares, which he called "extremely cheap."

The goal of the pact with VW was to cooperate on small, fuel-efficient cars for emerging economies, providing Suzuki with access to technology while giving VW a wider role in the Indian market through Suzuki's business there. Relations soured in 2011 after the Japanese company agreed to buy diesel engines from Fiat. As trust broke down, the companies accused each other of breaching the accord.

Marchionne's push

Fiat Chrysler Automobiles CEO Sergio Marchionne, who is prodding the auto industry to consolidate, has expressed interest in talking with Suzuki in the past. Fiat wasn't available to comment outside regular office hours on Sunday.

"Suzuki will certainly enter into partnerships, but to do that they don't have to get married," said Ferdinand Dudenhoeffer, director of the Center for Automotive Research at the University of Duisburg-Essen in Germany. "Scale isn't the secret to happiness."

The manufacturer may instead focus on targeted development projects in areas such as fuel cells and autonomous driving, said Takaki Nakanishi, an auto analyst at Jefferies Group LLC.

Even in winding down the relationship, the two companies were at odds. Suzuki said that VW has to sell the stake back to them or a party of the Japanese company's choosing, while VW said the buyer of the stake hasn't been decided yet. The German company, which has hired a bank for the sale, said it's still analyzing the ruling and will determine later who the buyer will be.

VW divorce

Suzuki also faces the prospect of having to pay damages after arbitrators ruled the Japanese company breached the agreement. The amount of any penalties would be addressed in a further stage of the arbitration proceedings, Suzuki said. The company has "turned misfortunes into opportunities" before and will take time to review its strategic options, said Osamu Suzuki. The one thing that's clear is that the company won't be working with Volkswagen again. "You don't remarry someone who you've divorced," Osamu Suzuki said.


Suzuki si dichiara pronta a joint ventures ma rifiuta categoricamente un ingresso in forze nel suo azionariato di un altro costruttore.
Senza il veto tedesco Suzuki può cercarsi un alleato per singoli progetti, ad esempio sono a zero a riguardo dei motori ibridi ed elettrici nonché avrebbero piacere ad utilizzare piattaforme medie e grandi di concorrenti.
L'expertise di Suzuki può far gola a molti, oltre a FCA anche Nissan e Ford starebbero dando un'occhiata.

TOKYO (Reuters) -- Suzuki says it will buy back the 19.9 percent stake held by top shareholder Volkswagen Group after an international arbitration court last month ordered the German automaker to sell its holding.

The Japanese automaker said it would repurchase on Thursday as many as 122.77 million shares at today's closing price of 3,842.50 yen, for up to 471.74 billion yen ($3.9 billion).

Suzuki did not say what it planned to do with the stock.

Rather than pursue other partnerships, Suzuki has been urged to focus on its dominant India operations and Maruti subsidiary by Daniel Loeb, whose hedge fund Third Point holds a stake in the automaker.

Loeb has urged the company to cancel the shares that it repurchases and focus on improving value for existing shareholders.

Suzuki and Volkswagen agreed to tie up in December 2009, pledging to cooperate on technology and on expanding in emerging economies, but the alliance soon faltered. Suzuki filed for arbitration in November 2011.

Bloomberg contributed to this report

Suzuki ha ricomprato le azioni in mano a Vw, l'alleanza e' stata un disastro ma almeno è stata un bel guadagno finanziario per i tedeschi che si troveranno 3,9 miliardi di dollari in tasca.

Secondo fonti di stampa nipponiche Toyota e Suzuki sarebbero pronte a creare un'alleanza.

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March 20, 2019 11:05 AMUPDATED 3 HOURS AGO

Toyota will build compact wagon for Suzuki in UK

NICK GIBBS   

 TWEET SHAREMORE

Suzuki will get a version of the Toyota Corolla wagon, shown.

LONDON -- Toyota will supply Suzuki in Europe with a station wagon that will be built at Toyota's UK factory and an SUV imported from Japan.

Toyota build a Suzuki version of its Corolla hybrid wagon at its factory in Burnaston, England, starting in 2020. Toyota's engine factory in Deeside, Wales, will produce engines for the wagon.

The additional work gives the factories an element of security as Toyota and other automakers reconsider investments in the UK due to the possibility of tariffs between Britain and the EU following Brexit.

The Suzuki model will be similar enough to the Toyota Corolla wagon that no new investment or jobs will be added, a Toyota spokesman told Automotive News Europe.

"The volumes will be confirmed nearer the time and are expected to be within the existing production capacity of the plants," Toyota said, adding that it still hoped the UK and EU will agree a tariff-free Brexit.

"We have consistently said that in order to ensure the competitiveness of our UK operations, we need tariff-free and smooth access to the EU and common standards. A no-deal Brexit would make it very difficult for our operations to be competitive," Toyota said.

Toyota employs more than 3,200 people at the two plants. The company recently invested 240 million pounds to upgrade the Burnaston plant to produce the new Corolla hatchback and wagon.

Suzuki SUV

Suzuki will also sell a version of Toyota’s RAV4 hybrid in Europe sourced from Japan.

The two models will help Suzuki to lower its CO2 emissions in Europe to comply with tougher reduction targets coming into force starting in 2020.

Suzuki lacks electrified models of its own and has recently had to restrict supply of its popular Jimny small SUV because it feared the gasoline car would increase its CO2 emissions average.

Currently Suzuki has the sixth lowest average CO2 emissions among automakers selling in Europe at 114.2 grams per km in 2018, according to figures released by JATO Dynamics in March.

Toyota engine plant in Poland will build Suzuki gasoline engines. The engines have been created specifically for smaller cars and were designed with Toyota input.

India tie-up

Toyota will also supply hybrid technology to Suzuki for vehicles sold in India.

The two automakers will co-develop a compact minivan for India to be built by Toyota and supplied to Suzuki.

Toyota will also build a Suzuki-developed compact SUV called the Vitara Brezza from 2022 at Toyota’s Kirloskar plant in India.

Suzuki will supply Indian-built vehicles for Toyota to sell in Africa.

The moves deepen the tie-up announced by Toyota and Suzuki announced in 2017

L'alleanza Toyota-Suzuki si amplia di parecchio: Suzuki lancerà una compatta sw ibrida su pianale Corolla. In più Suzuki rimarchiera' la Rav 4. In India ci sarà uno scambio di modelli con Suzuki che produrrà un mini suv per Toyota.