Case Analysis of Maruti ± Suzuki. Abstract The case gives detailed insight into the disputes between Suzuki Motor and the Governmen t of India (GoI), joint venture partners in Maruti Udyog Limited (MUL), an automobile giant in India. Covering the expansion plan, appointment ofBhaskarudu as the managing director and the disinvestment of MUL, it describes in-depth the disputes between the partners. Maruti is a national company which has grown because of the support of the government. We can't hand it over to Suzuki on a platter."- Murasoli Maran, Industry Minister, India, 1997. "Suzuki feels they can no longer afford the disadvantage of government controlover Maruti's decision making. They feel they can do better on their own."A Government of India Source, 1997. A BITTER FIGHT In August 1997, the Government of India (GoI) appointed R.S.S.L.N. Bhaskarudu (Bhaskarudu ) as t he managing director (MD) of India's passenger car market leader Maruti Udyog Ltd. (MUL). The appointment was strongly opposed by Suzuki M otors Corporation (SMC) ofJapan, the GoI's 50% partner in MUL joint venture. In a press release following the appointment, Osamu Suzuki (Osamu), Presiden t of SMC, claimed that the appointmen t was illegal on the grounds five of the directors who comprised the majority of MUL's board strength of nine, had objected to the appointmen t. Suzuki even alleged that Bhaskarudu was incompetent and unsuitable for the MD post. The GoI argued that as per t he 1992 amendment in the GoI-SMC joint venture agreement, both the partners were entitled to nominate the MD for five years in turns, and there was no need for any consultation on it. Industry ministerMurasoli Maran (Maran) alleged that SMC was opposing the appointment ofBhaskarudu as it wanted Jagdish Khattar (Khattar), Executive Director (ED), MUL (reportedly a SMC loyalist) to become the MD. Following the disagreement over Bhaskurudu's appointment, a furious exchange of letters took place between SMC and the Industry ministry. SMC asked forBhaskurudu's resign ation claiming that the minutes of the meeting when Bhaskurudu was appoin ted, did not fully record its objections to the same. Managing Organization Conflicts USHA PRAVIN GANDHI COLLEGE OF MANAGEMENT 45 However, the GoI refused to remove Bhaskurudu and reportedly even started
