Terminated partnership with Volkswagen; will seek tie-up mediation: Suzuki Chairman

TOKYO: Suzuki Motor Corp said on Friday it plans to buy back up to 20 per cent of its own shares by Nov. 16 next year, contingent on Volkswagen releasing them, marking the latest move in a spat between the two automakers.

Suzuki Chairman, Osamu Suzuki said that the company has terminated its partnership with Volkswagen. "There is no basis for a partnership with Volkswagen", he said.

According to Osamu, Suzuki will also seek the Volkswagen tie-up mediation in the international court.

Suzuki has been seeking a breakup of their two-year-old alliance because it is unhappy with what it says is the German automaker's failure to treat it as an equal partner. In September served VW with a notice of breach of contract, accusing its top shareholder of withholding hybrid technology.

If Volkswagen does not release the shares to Suzuki or to a third party specified by Suzuki, the Japanese carmaker said it will seek mediation.

VW bought a 19.9 per cent stake in Suzuki in 2009 for about 1.7 billion euros ($2.3 billion) to bolster its presence in the Indian market for small cars.

For Suzuki the tie-up was supposed to give access to technology it could not afford to develop on its own, but the partnership has failed to deliver any meaningful cooperation.

Suzuki will hold a media briefing on the matter at 5 p.m. (0800 GMT).

After Suzuki's statement, Volkswagen said it would hold onto the stake.