Suzuki, Volkswagen ink alliance to create top auto group

Under their agreement, Volkswagen will acquire a 19.9 percent stake in the Japanese carmaker. Suzuki will sell its shares to Volkswagen for around 222.48 billion yen under a third-party allotment to be carried out from mid-January.
The Japanese carmaker is also expected to buy shares in Volkswagen by spending up to half of the money received from the German automaker.
"We want to be the world's No.1 automaker by 2018 and Suzuki's cooperation will accelerate the achievement of our goal," Volkswagen's Chairman Martin Winterkorn said at a press conference in Tokyo.
The tie-up between the two carmakers will create challenges to Toyota Motor Corp, world's largest automaker in terms of sales, and the deal is likely to trigger further realignment in the global auto industry.
Suzuki intends to rely on Volkswagen to develop eco-friendly vehicles such as gasoline-electric hybrids and electric cars, an area in which the Japanese company is lagging behind rivals, local analysts said.
The news of the Volkswagen-Suzuki deal followed reports earlier this month that similar negotiations were under way between French carmaker PSA Peugeot Citroen and Mitsubishi Motors Corp.
Peugeot is seeking to forge a capital tie-up with Mitsubishi and to cooperate with the Japanese company in developing eco-friendly cars and producing vehicles in emerging economies, according to media reports, Kazinform cites Xinhua. See www.chinaview.cn for full version.