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Tata Motors Ltd and Volkswagen group firm Skoda Auto’s joint innings in India has ended even before it could begin.
On Wednesday, the companies said that they have ceased discussions on a potential alliance but will be open to talks on future collaborations.
The companies added that they have performed a technical feasibility and commercial evaluation of a potential collaboration and, based on intense and constructive discussions, jointly concluded that the envisioned areas of the partnership may not yield the desired synergies as originally assessed.
“The strategic benefits for both parties are below the threshold levels,” Guenter Butschek, chief executive and managing director at Tata Motors said in a statement.
Both companies have concluded that at present, neither the technical nor the economic synergies are achievable to the extent desired by both parties, said a spokesperson at Skoda Auto. “As a result, a planned strategic alliance will no longer be pursued for the time being,” the spokesperson added. Butschek said Tata Motors will, however, “remain positive of exploring future opportunities” with the Volkswagen group, given the “relationship of mutual respect that it witnessed during the phase of its cooperation discussions”.
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