Bosnian auto supplier Prevent is preparing to file a €2bn claim for damages against Volkswagen (VW) with a German court after VW canceled all contracts with the supplier at the end of March with only a day's notice, Suddeutsche Zeitung reported on April 23.
The tense relations between the two companies are not new. In 2016, Prevent stopped delivering components to VW, forcing it to halt operations of six of its ten German factories.
Suddeutsche Zeitung quoted Prevent’s spokesperson as saying that the claim will be filed once it is prepared. VW has said that will contest the claim. The German company claims it had informed Prevent properly of the decision to cancel the contracts.
Neither Prevent nor VW had responded to inquiries from bne IntelliNews as of going to press.
Back in 2016, the owner of Prevent — Nijaz Hastor, one of Bosnia's richest men — shut down his companies' output of seat covers and iron transmission cases after VW cancelled an order. VW was forced to interrupt production at six of its 10 German factories that build Golfs, Passats, engines, transmissions and chassis units, highlighting the importance of the Bosnian manufacturer.
Prevent employs over 13,000 people at 36 locations worldwide. In Bosnia, the company has 6,500 employees at 15 sites, and it is the country’s largest exporter. Besides car parts, its product range includes yacht interiors, protective clothing and fashion textiles. Its clients include Volkswagen Group, BMW, Citroen, Peugeot, Ford and Opel.
Earlier in April, the company announced that it had signed a new deal with BMW to produce car upholstery and that it will also expand its existing contracts with BMW, which has ordered additional quantities of the agreed products. The two companies are long-standing business partners. Prevent produces more than 1mn components annually for BMW vehicles.
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