Volkswagen’s Japanese division – Volkswagen Group Japan (VGJ) – is terminating the contract it signed in 1991 with Toyota Motor Corp. (TMC) for the distribution of VW vehicles in Japan. From the end of 2010 Volkswagen dealers currently under the Toyota distributorship (called DUO) will move to a new direct dealer contracts with VGJ.
The move, initiated by parent company Volkswagen AG, comes as part of its review and rationalisation of global sales structures following the economic crisis according to the company.
As part of this, the German carmaker requested a move to direct contracts with all dealers in Japan without a distributor, which has been agreed by TMC.
Volkswagen has had a so-called “2-channel system” in Japan since 1992: what it calls the “DUO channel” and the “Volkswagen channel”. DUO operations began in 1992 and have grown to include 134 dealerships run by 88 companies.
“Ending the distributor contract with TMC means that the DUO channel dealers will be, as the Volkswagen channel dealers already have been, directly served by VGJ in the function of a distributor,” explained VGJ spokeswoman Dorothea Gasztner.
Since 1990, VGJ has operated an import centre in Toyohashi (Aichi Prefecture), where Volkswagen cars sold in Japan are unloaded, undergo pre-delivery inspection and are shipped to all destinations in the country.
VGJ currently has 250 dealerships in Japan, making it the largest importer network.
So far, the DUO dealers have had contracts with TMC (Toyota), and TMC has had a contract with VGJ,” continued Gasztner. “Under the new structure, the dealership companies will conclude contracts directly with VGJ (as the Volkswagen channel dealerships already have been doing).”
In 2008, out of 45,522 Volkswagen cars sold in Japan, DUO dealers sold 21,774 units, thus contributing to making Volkswagen the number one import brand for nine consecutive years.
Meanwhile, Volkswagen has signed a framework agreement with another Japanese carmaker – Suzuki Motor Corp – that includes long-term strategic partnership on areas including global distribution.
“In terms of product portfolio, global distribution and manufacturing capacities, Volkswagen and Suzuki ideally complement each other,” said VW in an official statement. “The companies plan a joint approach to the growing worldwide demand for more environmentally friendly vehicles.”