TOKYO — In a deepening dispute, Suzuki Motor Corp. said Friday it sent a notice to Volkswagen AG alleging that it had breached terms of the car makers' alliance. Volkswagen rejected the allegations.
"Volkswagen always stuck to existing contracts," a company spokesman said, adding VW "did everything to ensure a successful partnership," and regrets Suzuki's step.
"We are keeping our options open, and after examining them we will decide on further proceedings," the spokesman said, adding that these may include legal measures, reported The Wall Street Journal.
The two car makers have found it hard to launch any joint operations since they formed the alliance in late 2009, and Suzuki last month asked VW to agree to dissolve the partnership—shortly after VW claimed Suzuki had infringed on the agreement in procuring engines from a third company.
A month later, there is no sign of a settlement, and Suzuki said Friday that Volkswagen hasn't yet agreed to discuss dissolution.
The Japanese company said it sent a notice to VW asking it to remedy "numerous breaches." Suzuki has been unable to gain access to VW's core technologies, Yasuhito Harayama, an executive vice president, said at a press conference.
"For Suzuki, this was the biggest goal of the alliance," he said. "But this hasn't materialized." He declined to specify other breaches.
Osamu Suzuki, the Japanese company's chairman and chief executive, said in a release, "If Volkswagen will not allow access, it must return Suzuki's shares."
For its part, Volkswagen entered the alliance with hopes of benefiting from Suzuki's expertise in the strategically important small-car segment. It acquired 19.89 percent of Suzuki at the end of 2009 for roughly €1.7 billion ($2.3 billion at current exchange rates), and Volkswagen Chief Financial Officer Hans-Dieter Poetsch has said his company has no intention of reducing or selling its stake.
Mr. Harayama said that if VW remains reluctant to discuss dissolving the alliance, Suzuki "may have to consider further action," though he declined to say whether that might mean legal action.
On Sept. 11, with their talks on alliance projects failing to proceed smoothly, Volkswagen sent a notice of infringement relating to Suzuki's procurement of diesel engines from Fiat SpA of Italy. Suzuki responded that the purchase didn't breach the agreement, and asked VW to retract the claim.
On the Tokyo stock market Friday, Suzuki shares briefly dropped as much as 4 percent but quickly regained most of that decline to finish the day down 0.2 percent at ¥1,656 ($21.52). In late-morning trading in Frankfurt, shares of Volkswagen were up 1 percent at €102.50 ($141.35).
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