Toyota Cuts Ties with Volkswagen in Japan

Volkswagen has already announced its enthusiastic plans to become the world's number one manufacturer in the next decade so its rivals have already started developing new market strategies to counteract its expansion. One of the first to react to VW's growth is Toyota, which recently decided to end a 17-year collaboration with the German manufacturer in Japan.

The reason is still an enigma for all of us but leftlanenews.com writes that Toyota and Volkswagen will cut ties in 2010. Although Toyota is clearly a strong player in Japan, the partnership helped Volkswagen grow in the country and become even the number one local importer.

Meanwhile, Volkswagen is looking to adopt a different path that could support its expansion plans even without a close collaboration with Toyota.

The German manufacturer recently purchased a 19.9 percent stake in Suzuki and, although the deal is still pending authorities' approval, rumors surrounding their projects have already started surfacing.

One of the first car to be released under the VW - Suzuki alliance is an affordable Indian model that will cost between $4,300 and $5,400, Reuters informed quoting a report by the Economic Times. Production will be handled by Maruti Suzuki, with the model to replace the Alto, a very successful car in the local market.

"At some point we will need a replacement for the Alto. That price range is the entry level for Indian customers today, so we can't leave that segment open," R.C. Bhargava, chairman of the Indian manufacturer, said in a statement. "Volkswagen will be greatly interested in a car below the price segment of the Up ... and that is something we will need to check in our future together with Suzuki," Fabian Mannecke, a Volkswagen spokesman, added.