Volkswagen to Acquire 20 Percent Stake in Suzuki

Volkswagen AG plans to take up a 20 percent stake in Suzuki Corp making it a win-win situation for both the companies. Suzuki Corp. requires a development partner in fiercely growing but competitive markets and VW needs Suzuki’s small car expertise.

Volkswagen intends to become world’s largest car manufacturer by 2018. It already rules the markets like China and Brazil even if it trails Volkswagen already owns premium brands like Audi, Porsche, Skoda, and Seat and dominates the segment.

On the other hand, Suzuki is currently being led by 80-year old CEO Osamu Suzuki who has been looking for his successor since past two years ever since his son-in-law passed away who he had been grooming for the top job. Suzuki holds enviable expertise in small cars and is a market leader in India with over 50 percent share in the country. Suzuki has been reluctant to come under any carmakers' control but with the changing scenario automakers are realigning themselves to survive tough market conditions, chronic over-capacity and a bad industry downturn.

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