At a press conference in the Italian city of Turin this week, Italdesign Giugiaro and the Volkswagen Group revealed plans for closer cooperation, with VW poised to acquire 90.1 percent of shares in the design firm for an undisclosed sum.

The remaining 9.9 percent will stay in the Giugiaro family, but as VW chairman Martin Winterkorn said in a statement: "Italdesign becomes a permanent member of the global Volkswagen family."

Speaking in Turin, Winterkorn said the acquisition meant VW was "participating in one of the most renowned design and development companies with one of the richest traditions in the automobile industry."

Italdesign was founded back in 1968 by Giorgetto Giugiaro and Aldo Mantovani and has notched up an impressive list of designs for clients including SEAT, Toyota, Suzuki, Alfa Romeo and BMW.

A winner called Golf

Volkswagen first worked with the Italian design group in the early 1970s and is credited with the development of the original Golf - one of VW's most successful models.

But that is not all. Italdesign has also been instrumental in shaping some of the other cars - including the Passat and the Scirocco - that have helped Volkswagen to its current position as Europe's biggest car manufacturer.

VW already owns Audi, Bentley, Lamborghini, Seat and Skoda and is in the process of finalizing the acquisition of Porsche. The Wolfsburg-based group is currently looking to expand its vehicle range in a bid to strip Toyota of its "world's largest car maker" title.

Volkswagen executives hope Italdesign will help them achieve that goal. Some 50 designers from the Turin-based company are already working with VW on the development of the new family model, Up!, which is due to be launched in 2011.

Roaring ahead

"A new era in the strategic partnership between our companies begins today," Winterkorn said in his statement, adding that the Volkswagen Group would be continuing its model initiative over the coming years and would benefit from the capacity and competence of Italdesign.

"The company will therefore be making an important contribution to our 2018 global growth strategy," he said.

Italdesign, which has an annual turnover of about 100 million euros (US$123 million) and is considered a pioneer in modern Italian car design, also welcomed the closer cooperation with VW.

"Becoming a part of the Volkswagen Group means re-evaluating ourselves and our strength," Giorgetto Giugiaro said in a statement. "Entering Volkswagen (opens up) a promising perspective for the company."

tkw/reuters/AFP/dpa
Editor: Sam Edmonds