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Head-to-head: Winterkorn and Piech

Volkswagen chairman Piech quits after feud with his CEO

on April 28 2015 | in Highlights, Industry news, Latest news | by | with Comments Off

First, Ferdinand Piech, the chairman of pretty much everything at the Volkswagen Group, criticised the company’s chief executive officer Martin Winterkorn, saying he was “at a distance” from him. Next, the workers at VW appealed to senior management to end the boardroom power struggle.

Ferdinand Piech, former chairman of the VW board

Ferdinand Piech, former chairman of the VW board

At no stage did Piech reveal why he was attacking his former close confidant and ruling him out as a potential successor. The feud (above, Winterkorn faces off with Piech) continued through the middle of April even after other board members backed Winterkorn. It ended this week with Piech resigning from all posts at VW.

VW’s steering committee had voted five-to-one for Winterkorn. Even Piech’s own cousin, Wolfgang Porsche, backed Winterkorn. Piech was unexpectedly isolated. His wife, Ursula, also a board member (controversially appointed three years ago), cast the only supporting vote. She resigned, too.

The 78-year-old grandson of Ferdinand Porsche, inventor of the VW Beetle, had previously seen off other executives who crossed him, including his own hand-picked successor as CEO, Bernd Pischetsrieder, and former Porsche boss Wendelin Wiedeking. Pischetsrieder went on to head BMW.

“We deeply regret the developments of the last few days,” said Wolfgang Porsche, Piech’s cousin and chairman of the holding company that owns the majority of VW voting shares. “We thank Ferdinand Piech for his decades of extraordinary and highly successful service.”

Spare seat: Ursula and Ferdinand Piech, Wolfgang Porsche, Martin Winterkorn

Spare seat: Ursula and Ferdinand Piech, Wolfgang Porsche, Martin Winterkorn

Piech’s departure ends the reign of an executive who transformed the VW Group into a global powerhouse. He became CEO in 1993 and soon moved to acquire Porsche, Lamborghini, Britain’s Bentley, Czech brand Skoda, Ducati motorcycles, as well as MAN and Scania heavy trucks.

Piech was a meticulous and daring engineer. In the late 1960s, he pushed forward development of the Porsche 917, a project that could have triggered the carmaker’s collapse if it failed. The vehicle ended up being one of the most successful race cars of the 1970s.

After joining Audi in the mid-1970s, he spearheaded the brand’s quattro four-wheel drive technology and use of lightweight aluminum components, laying the foundations for Audi to become the world’s second-largest luxury-car brand.

  • See ‘$500,000 for early rally car salutes 35 years of Audi Quattro’

Piech, whose term as chairman of VW’s supervisory board was due to expire in April 2017, is also a shareholder in VW and still can exercise influence through his stake as well as through the family holding structure, which has rules in place to prevent a public sale of stock.

The Piech and Porsche families own 50.7 per cent of VW through Porsche Automobil Holding SE. The German state of Lower Saxony has 20 per cent. Qatar Holding has 17 per cent, leaving only 12.3 in other hands.

“We assume that Mr. Piech doesn’t want to damage Volkswagen with his stake as it’s his life’s work,” Deputy Chairman Berthold Huber, an official with the IG Metall union, told reporters. He’s taking over Piech’s responsibilities on the board until a successor has been found. The smart money is on Winterkorn being appointed within the next 10 days.

 

 

 

 

 

 

 

 

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