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Porsche Claims Control of VW

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It's a case of Wolfsburg vs. Stuttgart over in Germany, where privately held automaker Porsche claims "de facto" control over the world's third-largest auto company, VW AG, having gained control of 35.1 percent of voting rights in the German conglomerate.

VW, its union workers, and its second-largest shareholder, the German State of Lower Saxony (in which Wolfsburg is located), aren't having it. Detroit News reports that Lower Saxony's premier, Christian Wulff, is threatening to raise his government's stake in VW by almost 5 percent, bringing it to a solid 25 percent and allowing the government veto power on the supervisory board. But can Wulff make a convincing case that the $6 billion needed to purchase that stake is a worthwhile expenditure? It sounds like he, Wagoner (GM), and Mulally (Ford) are in a similar boat, though the American CEOs have a lot more to lose.

Porsche CEO Wendelin Wiedeking stated that the maker of exclusive sportscars (and SUVs that share a platform, notably, with the VW Touareg) intends to continue increasing its shares of VW until it surpasses 50 percent. The two firms have shared a relationship since their inception, with the very first "People's Car," or Beetle, having been designed by famed engineer Ferdinand Porsche. In modern times, Porsche's grandson, Ferdinand Piëch, was formerly CEO of Volkswagen and is currently the chair of VW's supervisory board.

There are reports of infighting among members of the founding families of the companies. Sounds like Family Feud on a higher plateau, and presents issues that GM, Ford, and America could only dream of having right now. With VW and Porsche both producing outstanding vehicles, the American consumer shouldn't be too concerned either way. Unless Porsche adds an additional turbo to the 2.0T and slaps a $100,000-plus sticker at the top of the monroney.--Colin Mathews, photo by Basheertome

 
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