Suzuki Motor Corporation (Hamamatsu, Japan “Suzuki”) and Volkswagen AG (Wolfsburg, Germany “Volkswagen”) have reached a common understanding to establish a comprehensive partnership. A framework agreement has been signed by representatives of both companies.

In terms of global presence and product diversity, the partnership marks an important step towards the future for both Suzuki and Volkswagen. In terms of product portfolio, global distribution and manufacturing capacities, Suzuki and Volkswagen ideally complement each other. The companies plan a joint approach to the growing worldwide demand for more environmentally friendly vehicles. The management of Suzuki and Volkswagen has concluded that the complementary strengths of each company make for a perfect fit in exploiting their respective advantages as well as rising to the challenge of the global market.

In the automotive industry, where globalization and diversification proceed in parallel, both companies will establish a cooperative relationship while respecting each other’s independence as a stand-alone entity. Both parties are focused on achieving synergies in the areas of rapidly growing emerging markets as well as in the development and manufacturing of innovative and environmentally friendly compact cars.

To support a smooth development of this relationship, Volkswagen will purchase 19.9% of Suzuki’s issued shares. The Closing of the transaction is subject to approval of the relevant authorities and is expected in January 2010. Suzuki intends to invest up to one half of the amount received from Volkswagen into shares of Volkswagen. Both companies will form a long-term strategic partnership based on this which will support their successful strategies in these challenging times.

As demand continues to rise for smaller cars and for power trains with higher fuel efficiency and lower CO2 output, Suzuki and Volkswagen will offer a compelling solution for customers in emerging markets buying a car for the first time and also for customers in advanced economies seeking to lower their CO2 footprint while still enjoying the freedom of transport offered by an exciting range of cars.