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Volkswagen forced to sell stake in Suzuki

The six-year-long failed marriage between Volkswagen and Suzuki has finally come to an end. Almost. An arbitration panel in London issued its final verdict which, according to a VW press release, cleared Suzuki in terminating the agreement, so VW now needs to get rid of its 19.9-percent share. However, the tribunal's decision said VW performed all of its obligations and Suzuki didn't – the Japanese carmaker should have given VW last-call rights for a delivery of diesel engines, but failed to. The breach opens Suzuki up to damage claim, but so far VW only says it reserves the right to sue. Now that Suzuki has an outside investor to provide funds it meant to get from VW, perhaps both can get back to their reasons for being. The press release is below. 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 Wolfsburg, 30 August 2015 - 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.

Next Suzuki SX4 spotted again

Thanks to a sketch of the Suzuki S-Cross concept, we can already see the styling direction that the next-generation SX4 will take, and Suzuki is still hard at work on the production version of the car as evidenced by this latest batch of spy shots. These photos look almost identical to those captured back in July, but we see a little more detail at the rear of the car and get a better idea of the next SX4's proportions.
With the baggy camouflage lifted up at the rear of this prototype, we can see that the SX4 replacement has a very Mazda-chic look to it with downward-angled taillights that stretch into the liftgate. Aside from this, the big news is that we're finally getting a sense of the new SX4's size. Suzuki's press release attached to the Paris-bound S-Cross sketch said that the SX4 replacement would be growing to the compact segment rather than being a subcompact like the current car. Recent reports indicate that the next version of this car will be sized closer to the Grand Vitara, and in these pictures, you can definitely see how much the car has grown.
Still unknown is when we can expect to see the production version of the new SX4, or what will be inside it (available turbo power?), but hopefully Suzuki will not delay things like it did with the Kizashi and its numerous concepts.

American Suzuki gets $100M in financing to go out of business... buy more cars?

American Suzuki Motor Corporation (ASMC), which declared bankruptcy in early November, has been approved by the courts for up to $100 million in debtor-in-possession financing to enable it to shutter its US car business. ASMC had received a $45 million loan from the Japanese parent company, Suzuki Motor Corporation (SMC), last month in order to make repayment deals with its franchise dealers. At the same time, ASMC was awaiting final court approval of this larger loan.
Out of the newly approved funds, $50 million can be used for operations, and oddly, the other $50 million can be put toward purchases of new inventory from SMC. That's right, even as existing inventory was headed for a smooth exit with the help of incentives, customer demand for orphan Suzuki models is so strong - last month's sales were up 22 percent compared to 2011 - that ASMC plans to purchase 2,500 additional cars from SMC that were built after the bankruptcy announcement. Good news for the owners of those vehicles: the top 50 dealers, representing more than 98 percent of ASMC sales, will become parts and services centers.
The press release below has more information. Unlike its recent tenure here, the end of Suzuki cars in the US looks like it's going rather well.