The German press says that Wiedeking faces his Götterdämmerung after his plan for Porsche to take control of Volkswagen, a company 15 times Porsche's size, was abandoned.
Laden with debts of 9 billion euros ($11.99 billion) from its acquisition of 51 percent of VW shares, Porsche Automobil Holding on Wednesday halted its original plan to seize control of VW, which is Europe's largest automaker, by raising its stake to 75 percent.
Instead the Porsche-Piech clan, which controls Porsche, wants to merge their Stuttgart-based sports car business with VW under a new holding company. Porsche would become the 10th brand in VW group alongside units such as Scania trucks, Skoda, Seat, Bentley and Lamborghini.
Winterkorn favorite
It's not clear who will run the new company. German press reports say VW group CEO Martin Winterkorn, 62, is favorite because Wiedeking has made too many enemies with his outspoken attacks on the way VW is run.
“Wiedeking has broken too much china,” said Stefan Bratzel, head of the Centre of Automotive Research at the University of Applied Sciences in Bergish-Gladbach, Germany.
Winterkorn also is a protege of VW Chairman Ferdinand Piech, who wants Wiedeking and Porsche's Chief Finance Officer Holger Haerter to be fired for amassing huge debts at Porsche, according to German media reports.
Wiedeking admits that a merger with VW is not what he hoped for. “It's not a marriage made in heaven, more a marriage of convenience,” Wiedeking told Porsche's 3,000 employees in Stuttgart on Thursday.
When Porsche first began building up its stake in VW in 2005, Wiedeking upset Wolfsburg's powerful trade unions by calling for “sacred cows” to be slaughtered.
He challenged VW's labor agreement that pays the company's German workers above the industry average and called for the abolition of the so-called VW Law. The law gives the north German state of Lower Saxony where VW is based a blocking minority on strategic decisions because it has a 20 percent stake in VW.
Wiedeking also upset Piech by criticizing as cars, which the VW patriarch had championed, such as the Bugatti Veyron and VW Phaeton.
Until the extent of Porsche's debts became clear in recent weeks, Wiedeking, 56, had seemed untouchable.
He was praised as one of the auto industry's brightest stars after turning Porsche from a bankruptcy candidate into the world's most profitable carmaker. His salary of 80 million euros last year made him Germany's highest paid boss.
Wiedeking loses key ally
Now some of Wiedeking's staunchest supporters are distancing themselves from him.
Porsche's labor boss Uwe Hueck was previously a key ally of Wiedeking's in challenging VW's trade union leaders and the VW Law. Hueck now says he wants a similar law at Porsche to protect its workers..
“I am concentrating on the workforce, the bosses are secondary,” Hueck said.
Porsche's workers are disillusioned. “Porsche is finished. We're VW now,” one worker told reporters at the factory gates.
Lower Saxony and VW labor leaders have threatened to block a VW-Porsche merger unless they win key concessions.
Lower Saxony Premier Christian Wulff insisted on maintaining the state's blocking minority stake, two seats on the supervisory board, and a veto on plant closures. He added that a merger was by no means a done deal.
VW's employee leaders said labor should continue to have a major say in how the new company is run.
Porsche will struggle to dictate terms of how the new company will look, analysts and bankers close to the deal say.
"Volkswagen and Lower Saxony are now in the driver's seat," Credit Suisse analyst Arndt Ellinghorst said on Thursday. "Porsche needs VW's cash, and VW doesn't need Porsche's debt."
No comments:
Post a Comment