High-flying Porsche CEO Wendelin Wiedeking has been shown the door after a long and very public tussle with VW Chairman and Porsche family scion Ferdinand Piech.
Wiedeking, who was Germany's highest-paid executive with with equivalent of $110 million in earnings last year, had for the last four years been trying to buy up the much larger Volkswagen. Porsche currently holds more than 50 percent of the company.
But that crusade put loaded Porsche with about $13 billion of debt. Then the hunter became the hunted. Piech went on the offensive and suggested that instead Volkswagen should purchase Porsche.
Not surpisingly, Wiedeking and his CFO Holger Harter were not expected to stay on working for Piech. Surely, there's a lesson to be learned here, no?
At any rate, Porsche is now expected to become the 10th brand within the VW family of brands which also includes former quasi-competitors such as Audi and Lamborghini.Volkswagen CEO, Martin Winterkorn was quoted in the New York Times saying, "Like Audi already today, Porsche can develop independently under the roof of Volkswagen and keep its identity." Time will tell.Wiedeking, 56, was a hero around Porsche in the 1990s when he dragged to small-volume sports car maker into the modern age of efficient production and fattened the bottom line with the company's unexpected Cayenne sport-ute.
Don't cry for Wiedeking just yet, though: He'll walk away from Porsche with a roughly $71 million severance package. The Times reports that Wiedeking announced he'll put about $35 million into a charitable trust that would promote "socially fair development" at Porsche facilities, whatever that might mean. Of more potential interest to us is his intention to give about $715,000 to each of "three organizations that look after infirm journalists." Wait...what?
On a related note: Wende -- can we call you Wende? -- we always thought you were great.
alman08 says:
09:53 AM, 07/23/09
they're firing the wrong guy... he brought all the goodness to Porsche.
santiagofdz says:
03:12 PM, 07/23/09
+1 on alman's comment. I would have liked to see what he could have done with VW.
rsuryase says:
06:02 PM, 07/23/09
He made a mistake and must be shown the door. Tiny Porsche trying to take over huge VW?
magbarn says:
06:05 AM, 07/24/09
"Like Audi already today, Porsche can develop independently under the roof of Volkswagen and keep its identity."
Audi Independent?! Yeah right, I can't wait to see what's going to happen to Porsche over the years now that they're going to be under the curse of platform sharing and all it's negatives.
tryan says:
09:16 AM, 07/24/09
Don't forget, there are two Porsches...Porsche SE and Porsche AG, I explained the difference and the logic behind this exact scenario in the following blog post back in April:
http://blogs.edmunds.com/straightline/2009/04/could-vw-swallow-up-porsche.html#comments
Keep in mind that the Porsche and Pieche families still have a controlling (50%+) interest in the NEW Volkswagen AG (which includes Porsche). This move is all about politics and family positioning.