It is now becoming apparent how Volkswagen's partnership with Japanese automaker Suzuki and it's plans to become the world's largest automaker are intertwined. Outlined in a VW employee newsletter is an interview with VW board member Detlef Wittig, who says that the German automaker will rebadge Suzuki models as Volkswagens. The vehicles could then be sold in emerging markets, helping VW twofold.
First, it's likely that Volkswagen could sell a VW-badged Suzuki at a slight premium, allowing for better profits. Plus, it brings into play VW's larger plan to utilize another automaker's success in the small car market to its advantage. (Volkswagen, we should point out, has had a tough time making a success in the small car market and expects to face even larger challenges in building mini cars, as VW production costs tend to be quite high).
Suzuki may even take over all future mini-car projects, using its expertise in the area. This, after all, is one of the main reasons VW purchased a 20 percent stake in Suzuki last year. Currently VW is looking to produce a line of Up! small cars (shown above) and plans to introduce an entire lineup of even smaller vehicles, with Suzuki's help, after that. "Where VW's portfolio ends, Suzuki's begins," said Wittig.
So what does Suzuki get out of this? Well, according to a report by Car & Driver, the Japanese automaker is expected to get access to VW's new hybrid technology, even delivering a hybrid SX4 in the near future.
More: Report: Volkswagen to Sell Rebadged Suzukis as VWs in Emerging Markets